If there is a total loss to a building, the insurance company must pay the face amount of the policy or rebuild the property.
Valued Policy Law
Actual Cash Value or Replacement Cost are considered ________ _________ _________.
loss settlement valuations
Condition that increases the likelihood of a loss.
Hazard
If the company adopts a revision broadening coverage without additional premium, all insureds have the benefit of the revision right away.
Liberalization
the chance of financial loss is considered _____________.
risk
When the company and the insured cannot agree on the amount of a claims settlement, this condition details which process?
the appraisal condition
Insurance is an ______ ________ it is meant to make the insured whole again, but not profit.
Indemnity contract
A binder is considered __________ _____________.
temporary insurance
Methods for defining the amount of insurance that applies when covering multiple buildings are called _________________.
specific vs. blanket insurance
When the insured transfers his rights to his insurance party to collect from an at-fault party on his behalf.
subrogation
Responsibilities of the insured such as give prompt notice, report thefts to the police, protect against further loss __________________.
Is an exampled of Insureds Duties after a Loss
Section that details the percentage of insurance the customer must carry in relationship to the value of the property in order to get full claim payment.
example of coinsurance clause
Interest of the bank or mortgage company in a property.
example of lender interest
One who is legally liable must have the status of an insured under this policy.
Insured under a Liability Policy
An insurance policy has conditions that both parties must meet.
example of conditional contract
Insured has a substantial economic interest in the property
example of insurable interests
Cause of the loss
example of perils
Primary, Excess, Prorate are examples of
other insurance
Single limits, Split limits, Aggregate limits are examples of
liability limits
Failure to act as a prudent person would under similar circumstances.
This is an example of legal liability
The Unbroken connection between an occurrence and damage that grows out of it is ___________ ____________.
Proximate Cause
A condition preventing the customer from dumping damaged property on the insurance company.
Abandonment Clause
A condition of the policy limiting coverage to a geographical area.
Policy Territory
Insurance covers persons against economic loss arising from things they own.
Personal Contract
Physical harm to tangible property is considered:
Direct Loss
The insured cannot negotiate terms. It's a "take it or leave it" contract, therefore it is called ________________________.
a Contract of Adhesion
Insureds may not transfer their policy to another person. _______________ is not allowed.
Assignment
Economic Loss which happens as a consequence of Direct Loss is called ____________________.
Indirect Loss
The portion of the loss paid by the insured (1)
Insurance applies to each insured separately as if other insured did not exist (2)
Specific period of time the policy is in force (3)
1. Deductibles
2. Severability
3. Policy Period