Insurance - Chapter 2: Policy Provisions and Contract Law

All of the following are conditions commonly found in the insurance policy EXCEPT

Insuring agreement

Who is responsible for filling out a notice of claim form?

Insured

Which part of an insurance policy covers claims-related expenses, reasonable expenses incurred by an insured to protect damaged property from further loss, or defense expenses?

Additional coverage

The ABC Corporation has $100,000 of coverage on its building through insurance Company A, and $50,000 of identical coverage on the same building through insurance Company B. Assuming coinsurance is not an issue, when a $24,000 loss occurs and the pro rata method is used, how much will each insurer pay?

Company A will pay $16,000; Company B will pay $8,000

What insurance policy provision defines how the policy will respond if there is more than one insurance policy written on the same risk?

Other insurance

All of the following are considered parts of the policy structure EXCEPT

Provisions

An insurance contract must contain all of the following to be considered legally binding EXCEPT

Beneficiary's consent

Which of the following is NOT an essential element of an insurance contract?

Counteroffer

The part of a property policy that shows the amount of insurance, premium, and policy term is the

Declarations

Which of the following provisions requires that the insured protects the damaged property from further damage, cooperates with insurer in settling the loss, and submits to the insurer signed proof of loss within a specified period of time?

Duties after loss

An insured has four separate but identical policies written by different insurers to cover her $100,000 building. Each policy is for $100,000, and each has the pro rata liability other insurance clause. In the event of a total loss to the building, what would each insurer pay?

Each policy will pay $25,00 of the loss

What type of information would be found in a policy's insuring agreement?

Renewal Dates

Which of the following would qualify as a competent party in an insurance contract?

The applicant has a prior felony conviction

The pro rata liability clause is designed to protect the principle of

indemnity