what are the four elements of an insurance contract?
agreement-offer and acceptance
consideration
competent parties
legal purpose
what does representation mean and how does it differ from a warranty?
representations are statements believed to be true to the best of ones knowledge. a warranty is an absolutely true statement upon which the validity of the insurance policy depends
what is a binder?
temporary oral or written agreement issued by an agent or insurer that provides temporary coverage until a policy becomes effective
what information is included in a policys declarations?
declarations include the basic underwriting information (such as insureds name, address, amount of coverage and premiums, and a description of insureds locations) and any supplemental representations by the insured
what are additional or supplementary payments?
the additional coverage portion of a policy provides an additional amount of coverage for specific loss expense, at no additional premium
what is included in the conditions section of a policy?
the conditions section of a policy includes the general rules or procedures that the insurer and insured agree to follow under the terms of the policy
what is the term used to describe printed addendums to a contract that are used to change the policys original terms, conditions, or coverages?
endorsements
what does the exclusions section of a policy specify?
what perils are not insured against and what persons are not insured
when is an appraisal needed? how is it requested?
if there is a disagreement between the insured and the insurer on the value of any property loss, either party can make a written demand for an appraisal.. each party will select a competent appraiser who will then select an umpire if they are unable to a
what is proof of loss?
sworn statement that must usually be furnished by the insured to an insurer before any loss under a policy can be paid
what is the difference between cancellation and nonrenewal?
cancellation is the termination of an insurance policy by either party to the contract prior to the expiration date shown in the policy.
nonrenewal is the termination of an insurance policy at its expiration date by not offering a continuation of the exis
what is the purpose of the Fair Credit Reporting Act?
established procedures that consumer-reporting agencies must follow in order to ensure that records are confidential, accurate, relevant, and properly used. it also protects consumers against the circulation of inaccurate or obsolete information.