Georgia Property and Casualty

Policy Provisions and Contract Law. What is a binder?

a temporary oral or written agreement issued by an agent or insurer that provides temporary coverage until a policy becomes effective.

Types of Property Policies. Commercial Lines: How does the protective safeguards endorsements modify the policy?

adds a policy condition requiring the insured to maintain protective safeguards.

Types of Property Policies. Inland Marine and Others: How does the mobile-home endorsement change the homeowners policy?

alters the homeowners policy to cover a mobile home and other structures on land owned or leased by the resident of the mobile home.

Insurance Terms and Related Concepts. What is proximate cause?

an act or event considered a natural and reasonably foreseeable cause of the damage to property or injures a plaintiff.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: What is the definition of an under insured motorist?

an individual who owns or operates a vehicle, but whose liability insurance coverage's does not meet the state's financial responsibility limits.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: Give an example of a nonowned auto.

any private passenger auto, pickup, van, or trailer operated, but not owned, by the named insured or a family member; for example, a rental car.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: Define a newly acquired auto.

any vehicle acquired by the insured during the policy period. Please review the definitions above for the types of newly acquired autos.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: What types of vehicles are covered under a personal auto policy?

any vehicle listed on the declaration page; newly acquired vehicles for 30 days; trailers owned by the insured; and temporary substitute vehicles.

Types of Property Policies. Personal Lines: Under HO-6, where may business property be stored?

cover a structure that contains business property solely owned by an insured or a tenant of the dwelling, provided that the business property does not include gaseous or liquid fuel, other than fuel in a permanently installed fuel tank of a vehicle or craft parked or stored in the structure.

Types of Property Policies. Personal Lines: What is covered under the HO-5 comprehensive form?

covers both the dwelling and other structures on an open peril basis.

Types of Property Policies. Personal Lines: What is the purpose of a homeowners policy?

designed to cover dwellings primarily used as private homes.

Policy Provisions and Contract Law. What is included in the conditions section of a policy?

details what perils are not insured against and what persons are not insured.

Types of Property Policies. Personal Lines: What type of coverage does the HO-4 tenant broad form provide?

ensures personal property for the same perils as found in the broad form (HO-2)

Types of Property Policies. Inland Marine and Others: When does the federal emergency flood insurance program go into effect and end?

goes into effect when a community applies for the program and ends when all NFIP criteria have been met and the regular program can begin.

Insurance Terms and Related Concepts. How are indirect and direct loss related?

Direct losses can cause indirect losses.

Types of Casualty Policies, Bonds, and Related Terms. Workers Compensation, Crime and Other Coverage's: What are the two forms of commercial crime insurance?

Discovery forms and Loss Sustained form.

Types of Property Policies. Commercial Lines: What is excluded from business liability coverage?

Expected or intended Injury, contractual liability, and liquor liability; for a complete list, please review text.

Types of Casualty Policies, Bonds, and Related Terms. Workers Compensation, Crime and Other Coverage's: What are the 2 main parts of workers compensation insurance?

Part I is workers compensation, and Part II is employers liability.

Insurance Terms and Related Concepts. What are the 3 types of hazards?

Physical, moral and morale.

Types of Property Policies. Commercial Lines: What parts make up a commercial policy?

Policy cover, common policy declarations, interline endorsements, line(s) of insurance declaration page(s), line(s) of insurance coverage form(s), common policy conditions, line(s) of insurance conditions, causes of loss forms, and endorsements.

Insurance Terms and Related Concepts. If a product is unsafe, what kind of liability applies to the manufacturer?

Strict liability.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: What symbols are used in the business auto coverage form?

Symbols 1-9 and 19 are used in the business auto coverage form.

Types of Property Policies. Personal Lines: What coverage forms are available under the homeowners program?

The 6 coverage forms available under the homeowners program are HO-2 broad form, HO-3 special forms, HO-4 contents broad form, HO-5 comprehensive form, HO-6 condominium unit owners, and HO-8 modified coverage form.

Types of Property Policies. Commercial Lines: What are interline endorsements?

Those that apply, or could apply, to more than one coverage part.

Insurance Terms and Related Concepts. What does indemnify mean?

To "restore" an insured to the same financial status as before the loss.

Types of Property Policies. Commercial Lines: What businesses qualify for coverage under a business owners policy?

Small to medium size businesses.

Types of Casualty Policies, Bonds, and Related Terms. Commercial General Liability (CGL): Name the 3 types of legal entities.

Sole proprietor, partnerships, and corporations.

Types of Property Policies. Commercial Lines: What is covered in a building and personal property policy?

Buildings, business personal property, and property of others on the insured's premisis.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: Explain the 2 parts of the Garage coverage form liability section.

"Garage Operations- Covered Autos" protects the insured from losses resulting from the ownership or use of covered autos. "Garage Operations- Other than Covered Autos" protects against loss that is a direct result from the insured's garage operations.

Policy Provisions and Contract Law. What is proof of loss?

A sworn statement that must usually be furnished by the insured to an insurer before any loss under a policy can be paid.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: What are the 4 ways that a motor vehicle can be classified as uninsured?

A vehicle may be categorized as uninsured if (1) there is no liability bond or insurance for the vehicle; (2) the bond or insurance is less than that required by the financial responsibility laws of the state in which the accident occurred; (3) the accident was hit-and-run, and the driver cannot be identified; or (4) the bonding company or insurance company denies coverage or is insolvent.

Policy Provisions and Contract Law. What are the four elements of an insurance contract?

Agreement- offer and acceptance, consideration, competent parties, and legal purpose.

Types of Property Policies. Inland Marine and Others: What is a commercial floater?

An inland marine policy designed to cover movable commercial property, wherever it may be located.

Types of Property Policies. Inland Marine and Others: What is a personal floater?

An inland marine policy designed to cover movable personal property.

Insurance Terms and Related Concepts. What is the difference between vacancy and unoccupancy?

An insured structure in which no people have been living or working and no property has been stored for the specified period of time constitutes vacancy. Unoccupancy refers to an insured structure in which no people have been living or working within the required period of the time, but some property is stored.

Types of Property Policies. Personal Lines: What are the three dwelling policy forms?

Basic, Broad, and Special.

Insurance Terms and Related Concepts. What type of insurance provides coverage for multiple classes of property at one location?

Blanket insurance is a single property insurance policy provides coverage for multiple classes of property at one location, or for one or more classes of property at multiple locations.

Insurance Terms and Related Concepts. Compare bodily injury liability and personal injury liability.

Bodily injury liability is physical injury, while personal injury liability includes injury to the character of another person.

Types of Casualty Policies, Bonds, and Related Terms. Commercial General Liability (CGL): What is the difference between personal injury and advertising injury?

Both personal injuries and advertising injuries are nonphysical, but advertising injuries occur when the insured inadvertently injures another person during the course of advertising a product or service.

Insurance Terms and Related Concepts. What is the difference between an accident and an occurrence?

Both result in injury to persons or damage to property that is neither intended nor expected; however, an accident is a sudden, unplanned and unexpected event, and an occurrence includes those losses caused by continuous or repeated exposure to certain conditions.

Types of Property Policies. Commercial Lines: What coverage's are provided by a business liability coverage form?

Business liability coverage covers bodily injury, property damage, personal injury, advertising injury, and medical expenses.

Policy Provisions and Contract Law. 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 existing policy or a replacement policy.

Types of Casualty Policies, Bonds, and Related Terms. Workers Compensation, Crime and Other Coverage's: How are compulsory laws different from elective laws?

Compulsory laws require employers to provide workers compensation coverage for employees. Elective laws do not.

Types of Property Policies. Inland Marine and Others: What policy has the same structure as a Mobile Homeowners Policy?

Homeowners Policy.

Insurance Terms and Related Concepts. What type of policies may include the insurance to value provision?

Homeowners policies.

Types of Property Policies. Personal Lines: What does fair rental value include?

If property under Coverage A, B, or C becomes damaged or destroyed and unfit for normal use, the policy will pay the fair rental value of the described premises under Coverage D- Fair Rental Value, or part of it used as rental property.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: When is under insured motorist coverage applicable?

If the at-fault motorist has insurance, but the limits are not sufficient to cover the bodily injury.

Policy Provisions and Contract Law. 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 a competent appraiser who will then select an umpire if they are unable to agree on a fair value.

Types of Property Policies. Inland Marine and Others: How can coverage for the perils of a earthquake be added?

It can be added by endorsement to most property policies or coverage can be written in a Difference in Conditions Policy.

Types of Casualty Policies, Bonds, and Related Terms. Workers Compensation, Crime and Other Coverage's: Where must the loss occur in order for money or securities to be covered under the inside the premises- theft of money and securities coverage?

Inside the premises or banking premises.

Policy Provisions and Contract Law. What is the purpose of the Fair Credit Reporting Act?

It 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.

Insurance Terms and Related Concepts. In which of the two types of damage - property damage and bodily injury - is it more difficult to determine the monetary value of the loss and why?

It is more difficult to determine the loss monetarily with bodily injury, since it may lead to claims by the injured party not only for medical expenses and lost wages, but also for disfigurement, pain and suffering , mental anguish, and loss of consortium.

Types of Property Policies. Commercial Lines: What coverage is provided by the hired and non owned auto liability endorsements?

It provides coverage for liability arising out of the use or maintenance of a hired or non owned auto.

Types of Casualty Policies, Bonds, and Related Terms. Commercial General Liability (CGL): What does Coverage C- Medical Payments provide?

It provides for necessary medical or funeral expenses for third parties injured because of the insured's business operations.

Types of Casualty Policies, Bonds, and Related Terms. Commercial General Liability (CGL): What does Coverage A of the commercial general liability policy provide coverage for?

It provides protection for injury or death suffered by third parties and protection for damage to property of others.

Types of Property Policies. Commercial Lines: What coverage's does the extra expenses coverage form provide?

It reimburses the insured for extra expenses the insured incurs to keep a business operational after a loss.

Types of Property Policies. Personal Lines: What type of coverage is provided with all HO forms?

Liability coverage is included in all the homeowners policy forms.

Types of Property Policies. Personal Lines: What are extended covered perils?

On a basic policy, extended covered perils include windstorm or hail, explosion , smoke, aircraft and vehicles, riot or civil commotion, volcanic eruption, and vandalism and malicious mischief.

Types of Property Policies. Commercial Lines: What are the advantages of prepackaging?

Property and liability coverage is packaged; options most frequently needed are included or available for a small additional premium; and the rates for the entire package are extremely favorable.

Types of Property Policies. Commercial Lines: What do utility services include?

Provides coverage for direct damage caused by utility service disruption stemming from a covered peril.

Types of Property Policies. Personal Lines: What homeowners form provides protection for losses from named perils?

The HO-2 broad form provides protection for losses from named perils.

Types of Property Policies. Personal Lines: When replacement coverage cost is not reasonable, what type of HO coverage is applicable?

The HO-8 modified homeowners form is intended for use when the replacement cost coverage is not practical.

Policy Provisions and Contract Law. 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.

Types of Property Policies. Personal Lines: What are the eligibility requirements for a dwelling property policy?

The dwelling policy can insure just the dwelling, only its contents, or both.

Types of Property Policies. Commercial Lines: Who has the responsibility for payment of premium in a commercial package policy?

The first named insured is responsible for paying the premiums.

Types of Property Policies. Personal Lines: When does worldwide personal property coverage apply? What is not covered?

The insured may elect to apply up to 10% of the personal property limit to pay for losses to personal property away from the premises. There is no coverage for rowboats or canoes, or for property of guests and servants if away form the insured premises.

Types of Property Policies. Personal Lines: If more than one person has an insurable interest in the property, is the insurer liable for more than the insured's interest in the loss or damaged property?

The insurer will not be liable for more than the insured's interest in the loss or damaged property.

Types of Casualty Policies, Bonds, and Related Terms. Commercial General Liability (CGL): What is the difference between per occurrence limit and aggregate limit?

The per occurrence limit is the maximum amount payable per occurrence or accident. The general aggregate limit is the most the insurer will pay for all losses that occur during a policy period.

Types of Property Policies. Personal Lines: What type of coverage is expanded upon from HO-2 to HO-3?

The peril of vehicles insured for the personal property is expanded from what is covered in the broad form (HO-2).

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: How is insured defined for the Garage coverage form?

The person named in the declarations; people who operate a covered auto; people liable for the conduct of the insured; or an employee of the insured.

Types of Property Policies. Commercial Lines: What coverage's are included in the equipment breakdown coverage form?

The policy covers loss to property owned by the insured; loss or damage to property of others in the insured's care; up to $25,000 for expediting expenses and 90 days automatic coverage for newly acquired locations.

Types of Property Policies. Personal Lines: Define insured and insured location.

The policy defines the insured as the named insured and residents of the premises who are relatives or under age 21 and in the care of the insured. The insured location is the residence premises or any other premises at the same location, or part of it used by the insured as a home and described in the declarations; a premises not owned by the insured, but where the insured is temporarily living; vacant land owned or rented by the insured, excluding farmland; land owned or rented by the insured where a residential dwelling is being constructed; individual or family cemetery plots or burial vaults; and any part of premises occasionally rented to an insured, except for business purposes.

Types of Property Policies. Commercial Lines: What coverage limitations are in the Business owners Property Coverage form?

The policy will not pay for loss or damage to the water heating equipment, mysterious disappearance or property transferred to others based on unauthorized instructions. The Policy will not pay for damage to fragile items. If loss or damage is caused by theft, there are limits to amounts of coverage.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: What coverage is provided in the liability section of the business auto coverage form?

The policy will pay for injury or property damage to third parties.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: How much will a physical damage policy pay for transportation expenses due to a theft of a covered auto?

The policy will pay up to $20 per day up to a maximum of $600 for transportation expenses incurred by the insured because of theft of a covered auto and loss of use expenses the insured is legally obligated to pay because of theft of a non owned vehicle.

Types of Property Policies. Personal Lines: What perils are insured against in a special form policy?

The special form is an open peril form. All perils are insured against except those specifically excluded.

Types of Property Policies. Commercial Lines: What is the purpose of business income insurance?

To cover the loss of business income that occurs when a business must suspend operations because of a direct loss.

Types of Casualty Policies, Bonds, and Related Terms. Workers Compensation, Crime and Other Coverage's: What is the purpose of OSHA?

To set minimum standards for work safety.

Types of Property Policies. Commercial Lines: How much coverage is available on outdoor property under a building and personal property coverage form?

Up to $1,000 for fences, and radio and television antennas, or $250 for trees, shrubs and plants.

Types of Property Policies. Inland Marine and Others: What is a WYO insurance company, and how is it used?

WYO stands for write your own insurance company. The private insurers that participate in a WYO program write and service policies on a no risk-bearing basis through a special arrangement with the Federal Insurance Administration. They retain part of the flood insurance premium to pay for commissions and administrative costs. The remaining premiums, plus investment, are used to cover losses.

Insurance Terms and Related Concepts. What is a certificate of insurance?

Written evidence showing that an insurance policy has been issued.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: What losses are excluded from coverage in the liability section of the personal auto policy?

include intentional injury or damage; bodily injury to an employee during the course of employment; and use of a vehicle as a public or livery conveyance. Please review text for a complete list.

Policy Provisions and Contract Law. What information is included in a policy's declarations?

include the basic underwriting information (such as the insured's name, address, amount of coverage and premiums, and a description of insured locations), and any supplemental representations by the insured.

Types of Property Policies. Personal Lines: Is liability coverage provided with all HO forms?

included in all the homeowners policy forms.

Types of Property Policies. Commercial Lines: What services are covered by the medical expenses of a business liability coverage form?

includes ambulance services, X-ray services, and first aid when the accident occurred.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: What coverage's are available in the physical damage section of the Personal Auto Policy?

includes both collision and other than collision coverage.

Types of Property Policies. Personal Lines: What additional coverage's are included with the liability section of the HO policy?

includes claims expense, first aid to others, damage to the property of others, and loss assessment coverage.

Types of Casualty Policies, Bonds, and Related Terms. Workers Compensation, Crime and Other Coverage's: Who would want professional liability coverage, and why?

is beneficial to individuals who provide professional services to others for a fee. It protects them against legal liability that can result from negligence, errors and omissions, and the rendering or failure to render professional service.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: What does the liability section of the Personal Auto Policy protect the insured against?

protects the insured against loss arising from legal liability when an automobile that the insured owns, operates or maintains is involved in an accident.

Insurance Terms and Related Concepts. Explain the actual cash value method of valuation.

reinforces the principle of indemnity because it recognizes the reduction of value of property as it ages and becomes subject to wear and tear and obsolescence.

Types of Casualty Policies, Bonds, and Related Terms. Automotive: Personal Auto and Business Auto: Describe the duties of an insured motorist that is involved in an accident.

required to promptly notify the insurer of the loss, cooperate with the insurer, forward any legal papers received, submit to a physical exam or to examination under oath when requested, allow the insurer access to medical records, submit a proof of loss, notify the police of a hit-and-run accident or if a vehicle is stolen, protect the property from further loss, and allow the insurer to inspect and appraise the damaged property.

Policy Provisions and Contract Law. What does representation mean and how does it differ from a warranty?

statements believed to be true to the best of one's knowledge. A warranty is an absolutely true statement upon which the validity of the insurance policy depends.

Insurance Terms and Related Concepts. Define subrogation.

the acquisition by an insurer of an insured's rights against any third party for indemnification of loss or other payment, to the extent that the insurer pays the loss.

Insurance Terms and Related Concepts. When absolute liability is involved, does the injured party need to prove negligence?

the injured party does not need to prove negligence.

Types of Property Policies. Personal Lines: What must an insured do if a loss occurs?

the insured is required to provide the insurer with prompt notice of the loss; notify the police if a loss is caused by theft; notify the credit card or fund transfer card company if the loss is covered under the credit card and fund transfer card coverage; protect the property from further damage, and keep records of any repair expenses; prepare an inventory of damaged and undamaged property; allow the insurer to inspect the property as often as reasonably necessary; if requested, submit to an examination under oath and within 60 days of the insurer's request; and send a signed, sworn proof of loss.

Types of Casualty Policies, Bonds, and Related Terms. Workers Compensation, Crime and Other Coverage's: Who are the parties to a bond?

the principal (or obligor), the obligee (or insured), and the guarantor (or surety).

Insurance Terms and Related Concepts. What is risk?

the uncertainty or chance of a loss occurring.

Policy Provisions and Contract Law. What is the purpose of the Terrorism Risk Insurance Act (TRIA)?

to create a temporary federal program that would share the risk of loss from future terrorist attacks with the insurance industry.

Insurance Terms and Related Concepts. What is insurance?

transfers the risk of loss from an individual or business entity to an insurance company, which in turn spreads the costs of unexpected losses to many individuals.

Types of Property Policies. Personal Lines: What is the purpose of Coverage D- Loss of use?

will pay for either additional living expenses related to maintaining the normal standard of living of the household or fair rental value if the premises become uninhabitable due to a covered loss.