Personal Auto Policy, Commercial Auto Policies, Workers Compensation, HO policies, Other Coverages needed to rework:, Bonds:, NFIP, Property and Casualty Exam, Property & Casualty - Insurance Regulations, Insurance License - Liberty Mutual

additional coverages: loss assessment

$1,000 for share of loss assessment during policy period against residence premises by a corporation or association of property owners - assessment must be made as result of direct loss to property that is owned by all members, as long as it is the type that would be covered by insured's policy if owned by named insured - damage to association property must be caused by peril against - does not include earthquake or land shock waves after volcanic eruption

Joan has $5,000 Med Pay under her PAP. Joan gets injured in an auto accident and reports a $2,000 injury claim to her carrier two years later. How much would be paid?

$2,000 (no deductible)

maximum coverage permitted under regular NFIP program is:

$250,000 for a single-family home

mutual insurance must carry:

$3,000,000 life $1,000,000 health

additional coverages: fire department service charge

$500 for liability assumed by agreement for fire department charges to protect insured property - deductible does not apply - limit is an additional amount of insurance

additional coverages: credit cards, electronic funds transfer card, access device, forgery, counterfeit

$500 to cover legal obligation due to theft or unauthorized use of credit card, electronic funds transfer card, loss caused by forgery of check, loss through acceptance of counterfeit money - no deductible applies - limit is considered additional insurance

additional coverages section 2 HO: loss assessment coverage

- $1,000 per occurrence for insured's share of loss assessment charged against them as owner or tenant of residence premises (during policy period) (by corporation or association of property owners)

additional coverages section 2 HO: damage to property of others

- $1,000 per occurrence on replacement cost basis for damage insured causes to others property - not applicable to extent of loss for intentional damage, unless under age of 13 to property owned or property rented to tenant or from business of insured

additional coverages: landlord furnishings (except in HO4)

- $2,500 for insured's appliances, carpeting, and other furnishings in each apartment on residence premises that is regularly rented or held rental to others - covered causes of loss are limited to coverage C perils, excluding theft - not an additional amount of insurance

Laws in CT:

- $25,000 each person - $50,000 all persons BI - $25,000 PD - bond of $50,000 - cash deposit $50,000 for proof of financial responsibility other than insurance with 25/50/25

death benefit:

- $4,000 paid to surviving dependent for funeral expenses - if worker dies due to job-related injuries or disease, money is paid to totally dependent survivors - sole surviving dependent is spouse: benefit paid until death or remarriage - amount of benefit is equal to 75% of worker's after tax income

additional coverages: grave-markers

- $5,000 for grave markers, including mausoleums, for loss caused by peril insured against - on or off premises - does not increase limits of liability that apply for damaged covered property

homeowners policies may be used for:

- 1-4 family owner-occupied residences - no more than 2 families or 2 roomers or boarders per unit - various ownership types to include installments sale contracts, life estates, dwellings under construction, townhomes, duplexes - insuring tenant of non-owned dwelling (renter's form) - residential condo or cooperative unit (under condo form) - seasonal dwellings - secondary residences

eligibility in CT:

- 18 y/o - not committed any act that is ground for denial, suspension, revocation - pay required fees - have successfully passed the required state exam

CT disability rules:

- 3 days for disability benefits to kick in - if disability lasts for more than 3 days, on 4th day benefits will kick in and will cover the first 3 days as well - worker is entitled to 75% of spendable after tax income - minimum payable is 20% of state average weekly wage (SAWW) - maximum benefit is 100% of SAWW - disabilities (TTD, PTD, PPD) are subject to social security offset + benefits offset by social security drawn TTD - duration of disability PTD - duration of disability PPD - 52o weeks maximum

Gen. section - 3 workers compensation law:

- 3A states = states in which employer has employees - no coverage amounts listed in policy or on information page for statutory benefits - policy will pay whatever is in place in applicable state where injury occurs - employers should have each state where they have employees under 3A

section 2 HO: exclusions coverage F - medical payments

- BI injury resulting from nuclear hazard - BI injury to residence employee if it occurs off an insured location and does not arise in the course of employment - BI to any person eligible to receive benefits under workers comp or any other similar law

section 2 HO: exclusions E F = expected or intended injury

- BI or PD which is expected or intended by insured even if it is of a different kind or degree than initially expected, or is sustained by different person, entity, property than initially expected or intended

U.S. Longshore and Harbor Workers Compensation Act

- Designed to provide compensation and medical benefits to land-based employees while working on navigable water - (LHWCA) - situs satus tests - injury must occur on navigable waters or on wharf, pier, dock, or similar facility used in loading, unloading, building, repairing vessels - individual must have been engaged in maritime employment when injured - may be added to workers comp. for an endorsement - medical benefits - compensation for lost wages - rehabilitation services for injuries or disease related to employment - survivor benefits: provided in work-related injury causes of employee death

section 1 HO - conditions:

- HO policy separates conditions of insured and insurer by section insured's duties after loss: - provide insurer or agent with prompt notice of loss - notify police if a loss is by theft - notify credit card company if loss is covered - protect property from further damage - make reasonable and necessary repairs - keep records of any repair expenses - cooperate with insurer in investigation - allow insurer to inspect property at anytime - submit examination under oath if insurer requests - within 60 days, send sign, sworn proof of loss that includes time and events leading to loss, inventory, any changes in title or occupancy, receipts, bills, other insurance on property, interests of all insureds, estimates for repair

catastrophe coverage:

- a form of reinsurance that provides coverage for losses resulting from an accident of natural disaster involving more than one insured - typically must exceed a specified amount and number of insured's and or locations - umbrella or excess - written around $1,000,000

covered injuries:

- accidents arising out of and in course of employment or occupational disease - does NOT include disease in any form, except when results naturally and unavoidably from either foregoing causes - coverage does not apply to injuries from employee's voluntary participation in employer-sponsored, off-duty rec. activities that are not part of employee's duties - injuries are covered only when direct casual relationship to job or when workplace is the only possible place that disease could have been contracted - important factor is: what insurer was doing, not where the person was at that time ex. bob slips and falls on his way into office - may be able to hold employer liable if he can prove negligence, injury would probably not be considered work-related and would not be covered by workers comp. ex. on way to work accident: only covered if employer provided vehicle - could this have happened to the general public? or just to employee? - disqualify injury from coverage: = willful misconduct = attempt to injure another = intoxication = willful failure or refusal to use safety appliance or perform duty required by statute = willful breach of any reasonable rule or regulation adopted by employer = use of nonprescribed controlled substance

what is not covered in flood?

- accounts - bills - lawns - trees - aircraft - vehicles - fences - retaining walls - property prone to flood damage - underground structures and equipment - newly constructed buildings in, on, or over water - structures primarily considered containers

exclusions for commercial crime:

- acts committed by insured, insured's partners, or members = loss resulting from acts committed by above or by managers, directors, employees, reps. - acts of employees, managers, trustees, representatives - confidential info - government action - indirect losses = expenses incurred while establishing amount of loss - legal fees, costs, expenses - nuclear hazards - pollution - war/military action

temporary license purpose:

- adequate time for sale of insurance business owned by the producer - recovery or return of producer to business - provide training and licensing to a new personnel to operate the producer's business

anyone pretending to be a officer, director, agent, or other insurance employee who is embezzling funds faces:

- aforementioned fines = prior fines - jail time - if amount of embezzlement was less than $5,000, prison time would be reduced to 1 year

penalties and fines:

- after a hearing, a commissioner may impost a fine up to $5,000 per violation for a producer that unknowingly engaged in an unfair method of compensation or an unfair to deceptive practice. - aggregate level cannot exceed $50,000 - if producer knowingly and willingly committed acts, the penalty will be $25,000, with a maximum amount of $250,000 in 6 month - commissioner may suspend or revoke a person's license and/or order restitution of any sims to have been obtained in violent of the unfair trade practices provisions - producer who violates a cease and desist order = $50,000 per violation - licensee who negotiates, continues, or renews insurance contracts in any unauthorized company and neglects to file requires affidavits and statements may be fine up to $4,000, jail for 6 months, or both (also applies to licensee who negotiates such contracts with a suspended license

coverage D - loss of use:

- all HO policies contain loss of use coverage which is a combination coverage D (fair rental value) and coverage E (additional living expenses) in the DP property policy - if a loss covered under the policy makes part of the residence premise not fit to live in the insurer will cover loss of rent and additional living expenses for shortest time required - if insured permanently relocates, additional living expenses will be paid only for shortest time required to settle elsewhere - if loss of use results in order from civil authority, additional living expense and fair rental value are limited to a maximum of 2 weeks - expiration of policy will not impact the payment of this indirect coverage

loss payment: HO

- all losses will be paid within 60 days of receiving proof of loss after one of the following = agreement has been reached as to amount of loss = there is final judgement = there is a filing of an appraisal award with insurer

volcanic eruption period: HO

- all volcanic eruptions that occur within 72 hours are one event or one occurance

special provisions: business pursuits

- allows insured to extend section 2 liability coverage to certain business pursuits that occur AWAY from premises - covers activities of insured - will NOT cover liability of a business owned by an insured

additional coverages: ordinance or law

- allows insureds to use up to 10% limit of liability of coverage A (limit for buildings, additions, alterations) for increased cost incurred due to enforcement of any ordinance or law that requires: = construction = demolition = renovation of part of a covered building damaged by a peril insured against = demolition and reconstruction of undamaged part of a covered building if must be demolished due to damage to another part of covered building by peril insured against - ordinance or law does not cover: = loss in value to any covered building or other structure due to requirements of any ordinance or law = costs to comply with any ordinance or law that required insured to test for, clean up, or otherwise respond to pollutants on any covered building

occupational disease:

- any disease unique to occupation - any disease that can be contracted to employee due to excess hazards of employment - relating injury to workplace is easier than disease - if disease is ordinary to general life, will not be covered

Unlawful Insurance Fraud

- any person engaged in business of insurance, willfully with intent to deceive, make oral or written statements that are false or omit facts - includes information and statements made on an application for insurance, renewal of a policy, claims for payment or benefits, premiums paid, financial condition of insurer

directors and officers liability:

- applies to officers/directors of corporations or non-profits if there is a suit claiming they managed the business w/o proper regard for rights of others - protects directors and officers (past and present) for any claims for losses arising from wrongful acts while in official capacity - misstatements - neglect - breach of duty - this liability coverage only pays what corporation would under law, to reimburse individual director or officer - policy generally will NOT pay for FINES, PENALTIES, PUNITIVE DAMAGES

additional coverages: collapse

- applies to property under coverage A/B with respect to additional coverage - additional coverage does not limit liability - collapse: abrupt falling down or caving in of a building or part of building and leads to building being unoccupied - building or any part of a building that is in danger of falling down or caving in is not considered to be covered - covered if one of the following occurred: = perils insured against = decay that is hidden from view, unless the presence of such decay is known = insect or vermin damage that is hidden from view, unless presence of such is known = weight of contents, equipment, animals, or people = weight of rain collecting on roof = use of defective materials or methods in construction, remodeling or renovation if collapse occurs during the course of work - loss to awnings, fences, patios, decks, pavement, swimming pools, underground pipes, flues, drains, cesspool, septic tank, foundation, or retaining walls is not included under the definition, unless the loss is direct result of collapse of building or part of building

premium discounts:

- applies when an insured owes a total standards premium greater than $5,000

insurance commissioner:

- appointed by governor of CT - cannot be a director, officer, agent or insurance company

section 2 HO: exclusions coverage E F = watercraft liability

- arising from use of watercraft is not covered in following instances: - watercraft is operated in race or speed contest (coverage is granted for sailboat and if vessel is used in predicting log race) (accuracy of arrival is more important than speed of arrival) - rented to others - used to carry persons or cargo for a fee - used for any business purposes however, this exclusion does not apply to watercraft that meets the following: - is stored - is sailing vessel that is under 26 feet in overall length, or 26 feet or more if not owned or rented by an insured - is a watercraft that is powered by an inboard-outboard engine including those that power a water jet pump, and if it is 50hp or less, but only when borrowed or rented by in insured = if watercraft is over 50hp, coverage applies only if borrowed by insured - if one or more outboard engines or motors are 25hp or less, but if more than 25hp coverage applies if borrowed or rented by insured = coverage for over 25hp will also apply when newly acquired by insured within certain timeframes and if insurer is notified

All authorized insurers selling auto insurance must participate in:

- auto assigned risk plan

prohibited information in a report:

- bankruptcies more than 10 years old - civil suits - records of arrest - convictions of crimes - any other negative information that is more than 7 years old

General Provisions:

- bankruptcy: does not relive insurer to obligation - policy changes: term and conditions may not waived by endorsement - fraud: coverage is not provided to an insured making fraudulent statement - legal action against insurer: legal action cannot be made against the insurer until policy provisions have been complied - subrogation rights: insurer has right to recover payments - policy period and territory: US, US territories, Puerto Rico, Canada - termination: rights and duties of insured and insurer to cancel or non-renew coverage - assignment: insured cannot transfer rights or interest in the policy without written consent of insurer - two or more policies: insurer's liability is the highest limit of insurance if multiple policies cover same loss

Coverage B - other structures:

- basic amount of insurance equal to 10% of coverage A is included for other structures (but a policy can be written with higher limits) - HO forms add coverage for grave-markers and mausoleums property covered: - other structures on residence premise that are separated from dwelling by a clear space, or connected by only fence, utility line, or similar connection - other structures rented to anyone, other than a tenant of dwelling, but only when used as a private garage - structures used to store business property of the insured or tenant of dwelling, as long as gaseous or liquid fuel is stored in a fuel tank of a vehicle or craft stores in the structure property not covered: - land including land where other structures are located - structures rented or held for rental to anyone other than a tenant of the dwelling when not used as a private garage - other structures that are used to conduct any business

definitions of HO:

- bodily injury: bodily harm, sickness, disease, including required care, loss of services, and death - insured: = named insured = relatives of named insured who reside with named insured = nonrelative residents in care of named insured or resident relatives under age of 21 = full-time students under age of 24 who are relatives of the named insured and who were residents prior to attending school (if full-time student is a nonrelative, coverage is provided only until age of 21) = section 2 - liability: any person legally responsible for insured's animals, watercraft, or certain types of motorized vehicles - insured location: = residence premises = part of other premises used by named insured as a residence, and described in dec. or newly acquired during policy period = premise not owned by insured, but is where insured is living temporarily (motel) = vacant land owned or rented by insured (excluding farmland) = land owned or rented by insured where a residential dwelling (1-4 family) is being constructed = individual or family cemetery plots or burial vaults of the insured = any part of premise occasionally rented to an insured, except for business purposes(insured rents hall for daughter's wedding reception) - residence premises: = one family dwelling where insured lives = the 2-,3-,4- family dwelling where insured resides in at least one of the family units = part of any other building where insured resides, shown as residence premises in dec. == resident premise also includes: ---- other structures and grounds at that location - property damage: = physical injury, destruction, or loss of use of tangible property - residence employee: = employees of insured whose duties are related to maintenance or use of their home, including doing similar duties elsewhere

perils insured against: broad form

- broad form perils insured against for damage to property in HO 2 HO4 HO6: - broad form in dwelling and HO forms of coverage A,B,C,D) = fire or lightning = windstorm or hail = explosion = riot or civil commotion = aircraft = vehicles = smoke = vandalism or malicious mischief = theft = falling objects = weight of ice sleet snow = accidental discharge or overflow of water or steam = sudden and accidental tearing apart, cracking, burning, or bulging = freezing = electrical damage = volcanic action

navigation and territorial definitions:

- broadest policies cover watercraft while operated on inland body of water within US, Canada, coastal waters in same area of 10-25 miles - most restrictive policies: specific bodies of water and within narrow parameter around that area - many policies provide no coverage for offshore waters - gulf of Mexico

replacement costs: HO

- buildings/other structures if covered for at least 80% of their replacement cost - insurer has option of paying the least of the limit of liability, replacement with like kind and quality, or necessary to repair or replace the damaged building - if building is rebuilt at another premise: insurer obligated to pay no more than cost relating with building at original premise - insurer pays no more than ACV until actual repairs or replacement is complete - if cost to repair or replace damaged property is less than 5% of total amount of insurance, or less than $2,500, insurer will settle the loss without requirement that the property actually be repaired or replaced

Mobile Equipment:

- bulldozer - farm machinery - forklifts - other vehicles principally used off public roads - vehicles that travel on crawler treads - vehicles that provide mobility to cranes, shovels, loaders, road construction equipment - vehicles that are not self-propelled that provide mobility to compressors, pumps, spraying or welding equipment, or to cherry pickers and similar devices used to raise and lower workers DOES NOT INCLUDE: -

if after hearing for unfair trade practices, commissioner may:

- cease and desist from engaging in method of competition, act, or practice, and/or impose penalties for violation

special provisions: personal property replacement cost

- changes ACV settlement on personal property, household appliances, carpeting, awnings, outdoor equipment to a replacement cost basis - certain properties will not benefit such as fine arts, antiques, memorabilia, articles that are not in good working order, items that are stores and have become outdated or obsolete

consent to settle a loss provision:

- claim is filed under professional liability policy or errors and omissions policy, insurer cannot settle claim by offering to pay claimant without consent of insured

What can be insured on CAP:

- commercial vehicles, trucks of all sizes/shapes, truck-tractor units, semi-trailers, service commercial trailers - public vehicles = cabs, livery (transporting people), rental cars - private passenger types; station wagons, jeeps, pickup trucks, panel vans, utility trailers designed to be pulled by private passenger autos - other types: ambulances, farm machinery designed for use on public roads, antique autos, fire trucks, police cars, construction equipment used on public roads (cherry pickers, snow removal equipment), special or mobile equipment

hearings:

- commissioner can issue a statement of charges and hold a hearing for any purpose deemed necessary - hearing must be held within 30 days after the notice is served, unless the parties agree to postpone

rules concerning temporary licenses:

- commissioner may limit authority of temps. in any way to protect insureds and public - commissioner may require temporary license to have suitable sponsor who is a producer or insurer/who assumes responsibility for all acts of temp - commissioner may revoke temp if interest to insured's and public are endangered - temp may not continue after owner or personal rep. disposes of business

to be eligible for flood programs:

- community with minimum floodplain management guidelines - 2 solid walls - roof - above ground - NOT entirely over water

benefit for dependent children:

- compensation until age of 18 - child will continue to receive compensation up to attainment of age 22 if he/she is unmarried and a full-time student - benefits are subject to social security offset

fair credit reporting act:

- consumer reporting agencies must follow in order to ensure that records are confidential, accurate, relevant, and properly used - protects consumers against circulation of inaccurate or obsolete personal or financial information - acceptability of a risk is determined by checking the individual risk against many factors directly related to the risk's potential for loss

Motor Carrier Act of 1980

- contract carriers (haul of goods under contract), common carriers (haul goods for fee), freight forwarders $750,000 non-hazardous property for carriers in interstate commerce $1m oil, hazardous waste, by-hire or private (haul own goods) $5m specific hazardous = explosives, gas, radioactive material, for-hire, private carriers = interstate and intrastate carriers

completion bonds:

- contractor is required to borrow money to complete a construction project, lender will require a completion bond - bond guarantees that money borrowed will be used to fund the construction project and that the project will be completed free of any other obligations

criminal prosecution of producer report contains:

- copy of initial complaint filed - order resulting from hearing - any other relevant legal documents

what a report of administrative action to commissioner contains:

- copy of order - consent to order - other relevant legal documents

Trailer Interchange Coverage:

- cover loss or damage to non-owned trailer in the insured's care, custody, control if insured is legally liable for damage - trailer = trailer and semitrailer - comprehensive - specified - collision exclusions: - nuclear hazard - war or military action - loss of use - wear tear - freezing - mech breakdown - road damage to tires ACV damaged or stolen property cost to repair or replace w like kind limit of insurance shown in dec.

HO3 open or special form in relation to coverages:

- coverage A or B - damage to dwelling and other structures is covered unless it is excluded - coverage C losses in HO3 are covered for broad form perils

Gen. section - 5 locations:

- coverage applies to all locations listed in information page and in 3A unless states listed in 3A have other insurance or self-insured in place - in all states, medical payments are unlimited - no dollar limits or time limits set out to pay for necessary medical and surgical expenses, except possibly for certain types of care - benefits: disability income payments for injured employee's loss of wages = benefits begin after initial waiting period = benefits paid retroactive to beginning of disability if disability lasts for more than period defined in policy = benefits are expressed as a certain percentage of injured worker's wages, subject to weekly maximums and minimums for temporary disability and permanent total disability = total disability refers to an individual's total inability to work

Personal Auto Coverage Includes:

- coverage for radios and tape decks if they are permanently installed in dash

additional coverages: reasonable repairs

- coverage is provided to cover expenses incurred by insured to make reasonable repairs to protect property from further damage following loss by a covered peril

homeowners 6 coverage forms:

- coverages - perils - additional coverages - exclusions - conditions - homeowners also includes: personal liability coverage

additional coverages: trees, shrubs, other plants

- covered if loss or damage is caused by fire, lightning, explosion, riot or civil commotion, aircraft, vehicle not owned or operated by a resident of the premise, vandalism, malicious mischief, or theft - additional amount of insurance and limited to a max of $500 per tree, shrub, or plant - maximum 5% of amount of coverage on the dwelling - HO4 HO6 - maximum per loss is 10% coverage C

loss settlement:

- covered property losses will be settled as follows for HO2 HO3 HO4 HO5: = ACV: - personal property - awnings, carpeting, household appliances, outdoor antennas, equipment - structures that are not buildings - grave-markers and mausoleums - buildings or other structures (if applicable) that are at the time of loss are not insured to 80% of replacement value - insurer will have option of paying greater of ACV or application of coinsurance formula - if insured decides to not make a claim on replacement cost basis, the insured may notify insurer within 180 days after loss

Garage Form Coverage: (basics)

- covers businesses that regularly have autos of others in their care, custody, control - businesses that sell, service, repair, park, store vehicles that are not eligible for coverage under ISO forms - specialized coverage is needed - same basic coverage found in business auto coverage form risks covered: - franchised and non-franchised auto dealers - truck, truck-tractor, commercial trailer dealers - motorcycle, recreational vehicle, mobile home dealers - automotive repair shops - service stations - car washes - storage garages - public parking facilities Section 1 - covered autos section 2 - liability section 3 - garage-keepers liability section 4 - physical damage coverage section 5 - garage conditions section 6 - definitions (last section) garage operations: ownership, maintenance, use of locations for garage business, adjoining roads, ownership, maintenance or use of covered autos and all necessary or incidental operations products: goods or services made or sold by insured in garage business - includes failure to provide warnings or instructions work performed by insured: work someone performed on insured's behalf, providing of or failure

Motor Carrier Coverage Form:

- covers businesses that transport owned or non-owned property

Commercial Auto Coverage Form:

- covers commercial auto exposures; truckers, garages, motor carriers

Fiduciary Liability

- covers individuals who administer pension or employee benefit - fiduciary responsibility to manage funds in the best interests of the plan participants - losses associated with errors & omissions, negligence, poor management of plans will be covered with professional liability - if premiums for fiduciary liability insurance are paid by fund, by law policy must allow for subrogation against individual trustees involved in loss

Full Glass Coverage:

- covers your car's glass for breakage of safety glass with NO DEDUCTIBLE for an EXTRA PREMIUM

section 2 HO: exclusions coverage E - personal liability

- damage to property owned by insured - damage to property of others in care, custody, control of insured - BI to any person eligible for workers comp or similar benefits - BI injury to named insured or any relative minor residing in household - liability for any assessment charged against the insured as a member of an association, corporation, community of property owners - contractual liability (excluding contracts related to ownership, maintenance or use of the insured premises) - BI or PD damage in which an insured is also an insured under nuclear energy policy

supplemental payments:

- defense costs - expenses incurred at insurer's request - premiums for certain bonds - litigation costs - interest on judgement required by law until the insurer offers a settlement - all expenses the insurer incurs - other insurance clause: insurer will pay equal shares in event there is another insurance, including self-insurance that responds to loss

Gen. section - 4 state:

- defines a state, which is any state in US, and district of Columbia

experience modification factor:

- developed by rating bureau - calculations relate an employer's losses, payroll, premiums, all segregated due to classifications of operations

Declarations forms in CAP:

- different declarations page in each of the 5 commercial auto coverage forms - declarations contain named insured, coverage provided, limits of insurance, premium, list of all applicable endorsements - (nuclear liability on broad form) must be attached to commercial auto coverage part

coverage trigger for discovery and loss sustained

- discovery = covered taking place at any time discovered during policy period or extended reporting period = loss must be reported within 60 days of policy cancellation = loss must be reported within 1 year of policy cancellation = extended reporting period terminates upon replacement of coverage - loss sustained = policy will pay for a loss that was discovered during policy and an extended reporting period = also applies if loss occurred under prior policy in whole or in part, based on what insurer provided coverage and what coverage limits were selected = for a loss to be paid from prior policy period = insurance policy in place at time of loss must be effected when current policy canceled (no lapse in coverage) - most insurer will pay is lesser of limit of insurance in the prior policy or limit available on this policy as of its effective date - extended reporting period to discover in loss sustained = reported within 1 year of cancellation, extended reporting period terminates upon replacement of coverage in whole or in part

section 2 HO: exclusions E F = business liability

- does not apply to business exposures - coverage is granted for rental of an insured on an occasional basis - but only if used as residence - coverage for partial rental of residence, but only if portion rented is intended to house no more than 2 roomers or boarders, or certain business exposures such as office, school, studio, or private garage - self employed insureds under 21 are covered for full-time or part-time business with no employees other exclusions that apply to both coverages: - aircraft liability - hovercraft liability - professional services - insured premise which is not an insured location - war - communicable disease - sexual molestation, corporal punishment, physical or mental abuse - controlled substance

section 2 HO: exclusions coverage E F = motor vehicle liability

- does not apply to motor vehicle liability that arises from vehicles registered for public roads, unregistered that should have been registered, motor vehicles used in race/competition, rented to others, used to carry cargo or persons for a fee, or used in business besides golf cart not covered unless it meets the following: - dead storage on an insured location - used solely to service residence premise - used to assist handicapped if it is not designed to do so and is parked at insured's premise - designed for off public road use and not owned by insured or owned by insured but at time of occurrence vehicle is on premise that meets certain criteria in insured location definition - motorized golf cart meeting certain speed criteria, not altered from factory specifications, and used for golf and leisure activities at a golfing facility, and in private residential community where golf carts are legal

Gen. section - 2 who is insured:

- employer named on information page is the insured - partnership - partner is insured but only in capacity as an employer of partnership's employees

special provisions: limited fungi, wet or dry rot, bacteria coverage

- endorsement that may be used to add special limits for losses caused by fungi, dry and wet rot, and bacteria - endorsement applies to both property and liability losses

secondary injury fund:

- established to encourage employers to hire physically-impaired workers - second injury fund helps pay SOME of benefits for second injury - paid for by assessments on workers comp. insurers and self-insurers - employer or insurer must notify fund of intention to transfer liability within 3 years after date of injury, or 90 days after completion of payments for first 104 weeks of disability - notice accompanied by $2,000 notification fee - if claim is accepted, $1,500 will be refunded - if claim is denied, notice will be provided within 90 days - following hearing, commissioner may issue permanent vocational disability - 1-5 years and may extend 1-5 years - no employer is permitted to make more than one application within 12 months for reimbursement fund related to employee disabled

special provisions: earthquake

- excluded from all property policies, but usually can be purchased separately for an additional premium - can be purchased under dwelling, other structures, personal property - rates are determined on type of construction that determines vulnerability to earthquake loss - frame buildings are less susceptible to severe damage than masonry veneer buildings - lower rates of coverage - 72 hour period = one occurrence - deductible under earthquake coverage is stated as percent of loss; however it cannot be less than specified dollar amount (ex. $500 in HO'11 ISO form) == deductible applies separately to buildings, other structures, personal property, and loss of use - masonry veneer structures are not covered by an endorsement issued for frame dwelling = separate endorsement is available for this type of construction

HO6 condominium unit owners:

- expands coverage to include parts of the building such as alterations and appliances that the insured is required to insure due to condo association agreement - designed to cover owner-occupants of a condo included: - alterations, appliances, fixtures and improvements that are a part of the building contained within the residence premises - items of real property that pertain exclusively to residence premises - property that is the insured's insurance responsibility under a corporation or association of property owners agreement - structures owned solely by the insured, other than residence premises at the location of the residence premises - structures that contain business property solely owned by an insured and 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 does not cover: - loss of use or expense due to cancellation of a lease or agreement - land, including land on which residence premises, real property, or structures are located - structures rented or held for rental to any person that is not a tenant of the dwelling, unless used solely as a private garage - structures from which any business is conducted - structures used to store business property Coverage D: loss of use: - total limit of liability for the coverages in: = additional living expenses = fair rental value = civil authority prohibits use

additional coverages for section 2 HO: claims expense

- expenses incurred and costs taxed against insured in any suit the insurer defends, premiums on bonds required in a suit, reasonable expenses incurred by insured including up to $250 per day for loss of income, and interest on entire judgement that accrues after judgement has been entered and before insurer pays it

employment practices liability:

- exposures employers face in relation to employees being an employer - claims are not covered by commercial general liability for employers liability part of workers comp. - liability/protection for: = refusal to employ = termination of person's employment = demotion = failure to promote = negative evaluation = reassignment = discipline = defamation = humiliation based on discrimination = work-related sexual harassment = verbal, physical, mental, emotional abuse in relation to: race, color, national origin, gender, marital status, age, sexual orientation, physical or mental condition, any other protected class or characteristic established by federal/state/local laws

other states insurance:

- extends insured's coverage for new or incidental operations in other states (excluding monopolistic states) on automatic and temporary basis, subject to certain conditions and time limits - temporary or new operation must be listed on 3C - 3C describes all states other than monopolistic states - offers insured greatest protection for incidental or new exposures - if state is not listed, no coverage applies - when the work began is a critical part = if it is after effective date of policy and insured has made no other arrangements for coverage (self-insured) then coverage applies as if state were listed on 3A - mandatory coverage - if work is underway on effective date, coverage will only apply if insurer is notified within 30 days

additional unfair claims settlement practices:

- failing to maintain complaint handling procedures - false or fraudulent statements on or relative to applications for wanting; fee, commission, money, or benefits from insurer - coercing debtors to contract with certain insurer, disapproval of policy = payment of separate charge or usage or disposal of disclosing information to advantage of mortgagee, vendor, or lender - refusing to insure or limiting amount of coverage: physical disability, mental or nervous condition, intellectual disability, blindness, or partial blindness, exposure to diethylstilbestrol thru female parent, applicant being victim of family violence, genetic information - failure to pay claims within 60 days from paper formatted proof of loss or 20 days following electronically formatted proof of loss - failing to pay an amount equal to the settlement amount for any auto claim declared to be a constructive total loss

CT insurance companies must report what to the commissioner:

- failure on the part of an insurance producer to remit premiums for policies or endorsements issued within 30 days following date of account of producer with the company, its state agent, or managing general agent - check issued by producer to company or residual market is returned for insufficient funds and remains outstanding for 15 days - if investigation rises and reports concerning failure to remit premiums to proper company or agency, commissioner holds hearing and then suspends, or revokes license

Jones Act:

- federal act that cover's ships crews with same remedy available to railroad workers - anyone who spends more than 30% of his/her time on a vessel in navigation = seamen - seamen may sue employer for injuries sustained through employer's fault or negligence - act applies to navigable waters used for international or interstate commerce employer who does not qualify for Jones act: - one who works as a contract employee who moves back and forth between multiple vessels not under common ownership = covered under longshore or maritime law, and not under jones act

nonresident producer must do what when moving from home state to a new state:

- file change of address to Department of Insurance no later than 30 days after the change of legal residence occurs - nonresident that moves to CT does not need to submit any applications, or pay fees

WYO

- flood insurance thru NFIP is written as "write your own" policy - private insurers that take part in WYO, write and service policies on no-risk bearing facts thru special arrangement with (FIA) Federal Insurance Admin. - retain part of flood insurance premium to pay for commissions and admin costs - remaining premiums + investment = used to cover losses - if premium is insufficient to cover losses, insurers will be reimbursed for excess costs by NFIP - NFIP and WYO coverage is identical - any licensed property and casualty producer may place business with NFIP

HO3 form exclusions:

- freezing of plumbing, heating, air conditioning, sprinkler system unless heat is maintained or water is shut off and systems are drained (if building is protected by auto fire protected sprinkler system, insured must maintain water supply and heat in building for coverages to apply) - freezing, thawing, pressure or weight of water or ice whether wind driven or not applies to fences, pavement, patios, swimming pools, footings, foundations, retaining walls, piers, wharfs, docks - theft in or to a dwelling under construction - damage by wind, hail, ice, snow, or sleet to antennas, masts, towers, lawns, trees, shrubs, plants - vandalism and malicious mischief if dwelling has been vacant for more than 60 days - mold, fungus, wet rot unless hidden from view and caused by accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning, sprinkler system, storm drain or water, steam or sewer pipe off premise - constant or repeated seepage or leakage of water or steam over weeks, months, or years - wear and tear, mechanical breakdown, smog, rust, mold, wet or dry rot - smoke from agricultural smudging or industrial operations - discharge, dispersal, seepage, migration, release or escape of pollutants unless caused by coverage C (broad form peril) - settling, shrinking, bulging or expansion to include cracking that results from pavement, patios, footings, foundations, walls, floors, roofs, ceilings - damage done by birds, vermin, rodents, insects, or animals owned by insured - weather conditions to extent they contribute to an excluded cause of loss, acts, decisions, failure to act - faulty planning, design, materials (applies to coverage A B)

applicants for a producer's license must show what 3 things to a commissioner:

- good moral character - financially responsible - trustworthy and competent

Contract bonds:

- guarantee that jobs will be completed by the contractor according to contract specifications - guarantee performance of written contract

Auto Medical on PAP:

- helps pay medical expenses related to injuries sustained by you or your passenger - does not matter who is at fault - optional coverage - not a supplemental payment - no-fault - at-fault driver's injuries are covered by medical

special provisions: home business

- home business endorsement allows for a wider range of coverages than standard homeowners policy that includes property and liability coverage, and liability coverage normally found in commercial insurance policy - expands coverage, but provides smaller level of coverage than that found in a BOP

special provisions: home day care

- home day care coverage endorsement can be attached to policy to cover liability exposure - coverage includes loss or damage due to: = sexual molestation = corporal punishment = physical or mental abuse = draft and saddle animals - including vehicles used with such animals, motor vehicles, aircraft, or watercraft - premium is based on number of children kept in the home

additional coverages: building additions/alterations (except HO4)

- if insured makes or acquires improvements to residence made at his/her expense, the policy will provide an additional limit of insurance = 10% coverage C

special provisions: scheduled personal property

- if insured requires higher limits for certain types of property, scheduled personal property endorsement may be used to mark individual items on a blanket basis - open peril or special form - endorsement provides scheduling of 9 different classes: - jewelry - furs - cameras - musical instruments - silverware - golfer's equipment - fine arts (including porcelains, glassware) - postage stamps - rare and current coins - newly acquired jewelry, furs, cameras, musical instruments are covered up to lesser of: 25% amount of insurance for that class $10,000 - new property reported within 30 days - insured be required to pay additional premium moving forward - for coverage to apply to art - report provided within 90 days insured perils: endorsement insures against direct physical loss to property caused by: = wear and tear = insects or vermin = war = nuclear hazard = if fine arts = breakage caused by fire, lightning, windstorm, earthquake, flood, explosions, malicious damage, theft = if postage stamps = fading, creasing, denting, scratching, transfer of colors, disappearance additional benefits and features of scheduled property endorsement: - coverage C limits no longer apply for property scheduled on this endorsement - insured locations; scheduled personal property endorsement covers eligible property worldwide - fine arts and antiques - covered on an other than ACV basis - special limits of liability no longer apply to items or classes or property scheduled - no deductible will apply to a covered property loss

mortgage holders clause:

- if insurer denies claim, denial will not apply to mortgage if mortgagee has notified insurer of any change in ownership or occupancy, pays premiums due, submits signed proof of loss within 60 days - if insurer decides to cancel or non-renew - provide mortgage holder with 10 days notice

administrative action of producer:

- if occurs in other jurisdiction, commissioner must be notified within 30 days after final disposition

other insurance and service agreement:

- if other insurance applies to same loss, insurer is liable only for portion of loss that limit of insurance bears to total amount of all insurance on property (pro-rata or proportionate share) - if a service agreement is in place for covered property, policy will pay on an excess basis

loss payable clause:

- if the dec. states loss payee for certain listed insured personal property, the loss payee will be considered an insured under policy in regards to applicable covered property - if policy is cancelled, or non-renewed the loss payee must be notified in writing other conditions: - insurable interest and limits of liability - pair or set clause - suit against insurer - insurer option to repair or replace - nuclear hazard clause - recovered property - policy period - concealment or fraud

violent crime control and law enforcement act of 1994

- illegal for any individual convicted of a crime involving dishonesty, breach of trust, or a violation to work in business affecting interstate commerce - without receiving a letter of written consent from insurance regulatory official - 1033 waiver - consent of the official must specify that it is granted for the purpose of 18 USC 1033 - anyone convicted of a felony involving dishonesty or breach of trust, who also engages in insurance will be fined, jail time of 5 years, or both

selected endorsements: permitted incidental occupancies

- incidental businesses = office, studio - are permitted for eligibility, a separate permitted incidental occupancies endorsement must be attached to cover other structures used for business activity, remove special limit of liability for business property and personal liability and medical payments coverage - limitations are eliminated only for business described in endorsement

all coverage forms:

- include a deductible of $250 which applies to all coverages unless noted in the property

special provisions: personal injury

- including injuries that result from false arrest, libel, slander, defamation of character, invasion of privacy, may be added by endorsement

conditions of workers comp.:

- inspection: inspect at any time - long-term policy: policy period is longer than 1 year and 16 days, all policy provisions will apply as though a new policy was issued on annual anniversary date - transfer of rights/assignments: not transferrable unless insurer's written consent - cancellation: insurer must provide insured with 10 days written notice for any type of cancellation (insured can also cancel the policy with written notice to insurer) - sole representative: first named insured will act on behalf of all insureds under policy

NFIP 3 main components:

- insurance - floodplain management - floodplain mapping - 20,000 communities across US + territories participate in NFIP by adopting and enforcing floodplain management ordinances - in exchange = NFIP federally backs flood insurance to homeowners, renters, business owners in these areas

participation/dividend plans:

- insurance companies or some state workers comp funds are allowed to write participating policies (safety groups) - insured is eligible for dividends (partial premium refund) if experience during policy term falls within guidelines made by insurer at inception of policy term - dividends are not guaranteed - to be eligible = insured must meet associated underwriting requirements

Dwelling policy forms:

- insure residential structures and contents - up to $250,000 building coverage - $100,000 for personal property - eligible places; = single family structures = 1-4 family structures = condominium units = manufacturer mobile/trailer home = townhouses/rowhouses = timeshares

Supplemental Payments Exclusions:

- insured's loss of earnings except for when insured is attending a hearing or trial at insurer's request - insured's injuries are not covered

appraisal: HO

- insurer and insured can seek out an appraiser on either side to determine the cost

boatowners 2:

- insuring agreements for watercraft liability, medical payments, uninsured boaters - general conditions in both 1 and 2 - watercraft liability - medical payments - uninsured boaters - protection up to specified limits for claims against covered person for damages of BI and PD - insurer agrees to defend insured - insurer can make settlement - coverage for defense = payable in addition to policy limits exclusions: - BI or PD that is expected or intended - liability of anyone using without permission - BI for persons eligible for workers comp. - damage to owned or rented property in care, custody, control of insured - liability of persons selling, repairing, storing, moving watercraft - racing - speed tests - war - nuclear hazards - claim-related expenses are similar to personal auto policy - medical payments pays for accidents occurring while injured party is in, upon, or out of insured boat - some policies include medical payments for water-skiing - uninsured boaters coverage: stipulated ex. $10,000 apply for accidents with uninsured watercraft, increased limits are additional for extra premium

umbrella policy does not cover:

- intentional injury or damage - personal injury arising out of publication of material if done knowing it is false - bodily injury or property damage from ownership, maintenance, use, loading, unloading of rec vehicle - loss from use of motor vehicle w/o reasonable belief that person is entitled to do so - bodily injury or property damage from act or omission of insured as an officer, or member of board director of corp. - uninsured motorist (can be reinstated as endorsement) - underinsured motorist (can be reinstated as endorsement)

Federal Motor Carrier Safety Administration

- interstate truckers

temporary insurance producers:

- issued under special circumstances - expire after 180 days

what is not considered a flood:

- landslides - backup of sewers - windblown rain - snow - sleet - flooding in control by insured will not be covered

Insured Contract:

- lease premises - sidetrack agreement made with railroad when track is used by an insured - easement or license agreement (except within 50 feet of a railroad - indemnification of a municipality unless work is done for a municipality - part of a contract in which tort (imposed in absence of contract) liability of another is assumed for - rental agreements for 'autos' but not for damage to the auto ** any insured contract does not include agreements for demolition near railroads, autos rented with a driver or certain agreements made by carriers for hire

exclusions to employer's liability coverage:

- liability assumed under contract - punitive or exemplary damages - employees knowingly violated law - injury intentionally by insured - injuries that occur outside US, possessions, or Canada (injuries to resident temporarily outside these areas) - damaged caused by employment practices or policies of insured = defamation, harassment, humiliation, discrimination, termination - employees who are subject to federal workers comp. or employers liability laws (coverage is available by endorsement) - fines or penalties imposed because of violation of state or federal laws - damages payable under migrant and seasonal agricultural worker protection act

special provisions: watercraft

- liability protection for bodily injury or property damage caused by ownership/use of watercraft - (excluding when used to carry persons for a fee or when rented to others)

section 2 HO: conditions (property and liability)

- liberalization clause: if insurer adopts any changes that broaden coverage in policy, those changes will automatically apply to the policy at no additional premium and will apply automatically - implementation date falls within 60 days prior to or during policy period stated in dec. waiver or change policy provisions: any waiver or change of policy provisions must be in writing by the insurer cancellation and non-renewal: - insured may cancel at any time by retuning policy to insurer or providing insurer with notice in writing - if insurer cancels coverage coverage = provide insured with 10 day advance in writing = for nonpayment = all other cancellations = insurer to insured within 30 days - insurer can only cancel after it has been in force for 60 days for 2 reasons: ==material misrepresentation - prevented the insurer from issuing policy == substantial change in risk since policy was issued assignment: insured may not assign policy to any other person without written consent of insurer subrogation: insured may waive all rights of recovery against any other person, this has to be done in writing prior to a loss = if rights are not waived - insurer may require assignment of rights of recovery for losses to extent payment is made by insurer - if assignment is sought, insured must sign and deliver all related papers and cooperate with insurer - condition does not apply to additional coverage damage to property of others and coverage F - medical payments death: if named insured or spouse dies - deceased's legal representative will be considered an insured under policy but only in regards to property of deceased = definition of insured is broadened to include insured who is member of deceased's household but only while residing at residence premise - to person in care of insured's property but only until appointment of legal representative

employee theft in commercial:

- losses resulting from theft of money, securities, and other property - ONLY INSURING AGREEMENT THAT NEGATES EXCLUSION FOR EMPLOYEES, MANAGERS, TRUSTEES, DIRECTORS - coverage extension: only applies to employees temp. outside coverage territory for 90 days - coverage is automatically cancelled if employee committed any dishonest acts before, during, after any employment - exclusions: loss proven thru inventory shortage or accounting profit and loss, loss from trading, loss from fraud signing, issuing, cancelling, failing to cancel warehouse receipt

FELA Railroad:

- lost earnings - medical expenses if paid out of pocket by injured employee - payment for employee's reduced ability to earn a wage due to injuries - compensation for pain and suffering - all actions for FELA must commence within 3 years from day action began

Flood Disaster Protection Act of 1973

- mandated flood insurance for: = flood-prone areas as condition for receiving loans thru fed. gov. = property owners who do not purchase flood insurance within 1 year after is becomes available will not be eligible for full disaster fund relief (amount of disaster relief will be reduced by amount of insurance that could have been purchased)

Assigned Risk Plan:

- method of insurance for those who have been rejected in normal market to obtain coverage

continuing education:

- minimum of 24 hours every 2 years - 3 of those hours for ethics - 6 hours completed for each line of authority - PC or PL producers must complete one-time 3 hour course on Federal Flood requirements - credit hours may not be carried over to the next 2 year period - instructors receive same credit hours as students - no scheduled time to complete within year, except for military reasons - 30 days notice prior to nonrenewal date

twisting:

- misrepresentation or incomplete or fraudulent comparison of insurance policies that persuades an insured/owner to his/her detriment, cancel, lapse, switch policies, take out policy with another insurer - prohibited - $5,000, jail 30 days, or both

HO8 modified homeowners:

- most limited coverage - use when replacement cost coverage is not practical - written on a market-value basis for the property - used to insure houses with replacement cost more than current market value, or those built with irreplaceable materials (historic home) - modified basic form - used when writing 80% of the dwelling replacement cost or actual cash value that could cause a moral hazard restrictions: - theft coverage = theft is covered for ACV of what was stolen, with limits for certain classes of property - separate limits for theft of certain property (silverware, guns) are not included - basic limit of $1,000 that applies to theft losses worldwide coverage: coverage for personal property while away from premises is limited to larger of 10% of personal property limit or $1,000 debris removal: not considered an additional amount of insurance and is included in total policy limit trees, plants, shrubs: maximum limit for any one tree, plant, shrub is only $250 property of guests or residence employees: property may be covered online while on insured premises

Coverage C - personal property:

- most notable coverage change from dwelling property policy - coverage C was optional in dwelling, but now is mandatory in ALL HO forms - HO2 HO3 HO5 HO8 automatically include a limit of insurance equal to 50% coverage A limit (may be increased or decreased but not below 40% for 1-2 family residences) - HO4-HO6 = amount of insurance is selected by insured with coverage minimums varying by state - personal property coverage in HO is broader than dwelling - HO8 = treated separately as it retains elements of the dwelling form when covering personal property special limits: - $200 money, bank notes, bullion, gold, silver, platinum, coins, other metals - $1,500 for securities, deeds, evidences of debt, letters of credit, notes other than bank notes, manuscripts, passports, tickets, stamps - $1,500 watercraft and trailers, furnishings, equipment, outboard motors - $1,500 other trailers - $1,500 theft of jewelry, watches, furs, precious and semiprecious stones - $2,500 theft of firearms - $2,500 theft of silverware, silver-plated ware, goldware, gold-plated ware, pewterware, including flatware, hollowware, tea sets, trays, trophies - $2,500 for property on premises used for business purposes - $1,500 for property away from premises used for business purposes - $1,500 for loss of portable electronic equipment that produces, receives, or transmits audio, visual, or data signals while in a motor vehicle - $250 for loss of antennas, wires, or any media used with electronic equipment in a motor vehicle limited property at other residences: - personal property located at another residence of insured is covered for larger of $!,000 or 10% of coverage C limit = this limitation does not apply if property is moved because the residence premise is being repaired, renovated, or rebuilt - when property is moved to a newly acquired residence for 30 days, the limit shown on dec. will apply on a proportional basis to each residence - coverage will not extend beyond expiration date of policy

in order for an insurance company to obtain certificates of authority:

- must comply with minimum capital and surplus requirements

personal umbrella policy:

- named insured - family member - person using auto or rec. vehicle (all-terrain, dune buggy, golf cart, snowmobile, motorized land vehicle for rec use off public roads) that is owned by insured and covered under policy - any person using temporary substitute for these rec autos is also insured - person/organization respect to legal responsibility in acts or omissions of insured or family members while using rec vehicle - owner or lessor of auto or rec auto loaned or hired by insured is NOT insured - person or organization legally responsible for animals owned by insured or family member (person using or having custody of animals in course of business or without consent of insured are NOT insured

Medical Payments Coverage:

- necessary medical and funeral expenses caused in an accident sustained by insured - does not cover lost wages - rendered within 3 years of accident - payments available from liability or uninsured motorist coverage reduce the amount of medical payments coverage

Coverage F - medical payments to others HO

- necessary medical expenses incurred within 3 years (36 months) of an accident causing bodily injury - medical expenses = medical, surgical, x-ray, dental, ambulance, funeral services - coverage applies IF person is injured on residence premise with insured's permission to be there OR if a person is injured by an insured off residence premise and injury: = arises from residence premise or ways of adjoining premise = caused by activities of an insured = is caused by residence employee of an insured during course of their employment = is caused by an animal owned or in care of insured - does not apply to insured or regular residents of the insured's household, except residence employees

Liquor Liability

- need for a dram shot, liquor, or package store - protection action brought on against insured for selling liquor who is in an accident = covers bodily injury and property damage - manufacturing, distributing, selling, serving, or furnishing alcoholic beverages

in a covered loss

- no deductible to access umbrella or excess limits

criminal prosecution reports:

- no later than 30 days after pretrial should a producer report to the commissioner

surplus lines:

- non-admitted insurance: any PC placed thru surplus lines broker with non-admitted insurer eligible to accept this type of insurance - insurance that is hard to place - insurance that is not readily available thru authorized insurer - excess or surplus insurers - unregulated - only sold thru licensed excess and surplus lines brokers rules: = after diligent effort, insurance cannot be written through authorized carrier = purpose of writing insurance thru excess or surplus must not be to obtain better price or better terms - coverage must be written thru state-licensed excess or surplus lines broker - NAIC publishes lists of excess and surplus line insurers that are acceptable

Your duties if injury occurs:

- notify insurer at once - provide immediate medical care required by law - provide names and addresses of injured worker and any witnesses - promptly send any notices or other legal papers - cooperate with insurer - do not make any voluntary payments or assume any obligations

difference between commercial umbrella vs. excess:

- once a liability claim is filed for recovery for injury or damage, primary policy pays up to limits, after which umbrella policy will apply - if there is no primary underlying, excess policy will apply after insured paid self-insured retention

flood definition:

- overflow of inland or tidal waters - unusual and rapid accumulation or runoff of surface waters from any source - mudflow (river of liquid and flowing mud on surfaces of normally dry land) - collapse - collapse or subsidence of land along shore of late, or similar body of water as result of; erosion, undermining from waves, currents, exceeding anticipated cyclical levels

Transportation Expenses:

- paid if loss is caused by collision or other-than-collision - applies to owned autos - 24-hour waiting period for expense for losses other than theft - 48-hour waiting period for expense payments resulting from theft

additional coverage for section 2 HO: first aid to others

- pay expenses insured incurs to render first aid for BI to third parties (insurer will not pay for personal BI to insured, only to third parties)

additional coverages: glass or safety glazing material

- pay for breakage of glass or safety glazing material which is part of a covered building, storm door, or storm window - coverage is provided for same property if the loss is due to earth movement - covered property is also protected from fragments or splinters of broken glass or safety glazing material - no coverage is provided if dwelling has been vacant for more than 60 days (does not apply to loss due to earth movement)

Physical Damage Coverage:

- pays for direct and accidental loss to your vehicle - collision coverage - other than collision coverage - coverage D = damage to an insured's car and is OPTIONAL = 2 parts: collision & other than collision - written on ACV basis and HAS DEDUCTIBLE - other than collision = comprehensive coverage - collision = colliding with another object, rollover, upset - other than collision or comprehensive coverage = hitting animals, birds, potholes, etc. - towing and labor pays on a PER EVENT/PER OCCURENCE BASUS - flood damage is covered on PAP, but not on property policies - owner's PAP is always primary policy; driver's PAP if different is always excess

Rental Reimbursement:

- pays toward expense of renting a vehicle if you have a loss covered by either collision or comprehensive coverage if your car is disabled

nonresident producers conditions:

- person is currently licensed as a resident and in good standing in home state - person has submitted proper request for licensure + fees - person has submitted to the Commissioner the application for licensure - home state awards nonresident producer licenses to residents of this state, on same basis (states reciprocity)

Personal Auto Liability Exclusions:

- personal property (in transit) - injury to your employee's - auto business - commercial use -intentional acts - someone using vehicle without permission - taxi or livery - a non-owned vehicle that is used on a regular basis (friend using car to get to class regularly, gets into accident = not covered) - no coverage in Mexico - no coverage for an insured's property in transport - auto medical does not cover injured pedestrians - motorcycles - dump trucks - (WILL COVER = small pickup trucks even if used for farming/ranching) - farm implementation driven on highway - other than collision exclusions: wear and tear, freezing, mechanical breakdown - no coverage for autos used as taxis or livery, CARPOOLS ARE COVERED) - intentional injury or damage - use of auto without permission - use of commercial-type vehicle in business - damage to property being transport - wear and tear - radioactive contamination - nuclear weapons - war - insurrection - rebellion - revolution - electronic equipment for reproduction of sound = radios, stereos, tape decks, compact disk players and accessories - electronic equipment that transmits audio, visual or data signals, including citizen band radios, telephones, two-way mobile radios, scanning monitor receivers, television monitor receivers, video cassette recorders, audio cassette recorders, personal computers and accessories = does NOT include above when FULLY INSTALLED IN DASH OR CONSOLE - loss due to confiscation or destruction by government/civil authorities - camper body, trailer, motor home not shown in dec. - awnings - cabanas - equipment designed to create additional living space - non-owned vehicles used w/o reasonable belief that insured is entitled to do so - radar detection equipment - radar detection equipment - custom furnishings or equipment in any pickup, van, special carpeting and installation, furniture, bars, facilities for cooking or sleeping, height extending roofs, custom murals, paintings, other decals

boatowners 1:

- physical damage includes perils insured against, exclusions, conditions - motors described in dec. including remote controls and batteries - permanently attached equipment - trailer if for boat transport - equipment and accessories manufactured for marine use - cover equipment to use of vessel subject to dollar limit - open-peril (insurer will pay for direct and accidental loss) - exclusions: war, nuclear hazard, wear and tear, gradual deterioration, inherent vice, latent defect, mechanical breakdown, faulty manufacture, damage caused by repairing or restoration, service or maintenance operation unless fire results, while carrying persons or property for a fee, while boat is rented, race or speed contests additional coverages: - reasonable repairs - does not increase policy limit - recovery - stranding or sinking, ocean marine provision entitled salvage, does not increase limits of liability - automatic coverage - replacements for boat, motor, trailer listed in dec. if insured lets insurer know within 45 days and pays any additional premium

selected endorsements: special provisions

- policy used in CT for owner-occupied dwellings and personal property of renters is homeowners policy program (HO 91) - written by insurance services office (ISO) in 1991 - changes compared to rest of US = HO0106 special provisions CT - coverage D - loss of use - HO91 allowed insured the choice of collecting either additional living expense OR fair rental value == changes language to refer to "any increase in living expense incurred by you so that your household can maintain its normal standard living' - other coverage section = item has been added that modifies exclusion based on building ordinance or law = coverage allows the insured to use up to 10% of coverage A (if building owner) or 10% coverage C (if there is no coverage A) to apply increase in cost of construction due to building ordinances - cancellation and non-renewal provision: 30 days notice for cancellation of a policy that has been in effect for more than 60 days. if non-renewal = 60 days advance notice

Premiums:

- premium section includes: how premiums are determined, what requirements are for insured record retention, what rights insurer has in auditing insured's books and records - premiums are determined by CLASSIFICATION: = not industry specific in most cases but instead for job types (inside sales, outside sales, clerical executive, etc.) - each classification will have corresponding rates associated - higher the hazard, higher the rate - rates are determined by insurer and require approval by state insurance departments

true umbrella policy:

- primary or underlying coverage policy does not cover the loss, umbrella will

Duties After Loss:

- prompt notification of loss - cooperation with insurer - forwarding legal papers - submitting physical or other examinations under oath - allowing insurer to access medical records - notification of policy of hit-and-run or theft - protection of property to inspect from further loss - allowing insurer to inspect and appraise

HO3 special form

- protection for dwelling and other structures on an open peril basis - personal property is covered only for broad perils - vehicle damage to fences, driveways, or walks is covered even if it is caused by a resident - not covered: = all property, losses, and perils not covered due to limitations on insuring agreement and general exclusions = damage caused by freezing while dwelling is vacant, unoccupied, or being constructed unless insured takes reasonable care to maintain heat in the premises or to shut off and drain water supply = theft in or to a dwelling or structure under construction = vandalism and malicious mischief if the dwelling has been vacant for a certain period of time (more than 60 days in most states) = gradual, preventable, or expected losses such as wear and tear, latent defect, contamination, bulging, expansion of foundations, pavements, walls, or floors = faulty, inadequate or defective planning, zoning, surveying, design = losses caused by weather conditions to extent that they contribute to causes found in general exclusions (flood, power failure, etc.) - acts, decisions, or failure to act

Liability Coverage:

- protection for when YOU are at fault in an auto accident = coverage for injuries to other people = coverage for damage caused to someone else's property

employer's liability insurance:

- protects insured from situations not covered under a state's workers comp. law - basic limits: = $100,000 for bodily injury per accident = $100,000 per employee for disease = $500,000 policy limit for disease - can purchase higher limits for additional premium - some states these limits do not apply - besides basic coverage, supplemental coverage is also provided - coverage for employer's liability associated with BI by accident or occupational disease, includes death if triggered by: = injury arises from employment by insured = occurs in state or territory listed in 3A of info page = occurs during policy period = if suit is brought in USA or its territories, possessions or Canada

Uninsured Motorist:

- protects you if you are involved in an accident with someone who breaks the law by not carrying their own auto liability insurance - additional protection: Underinsured motorist coverage: provides coverage for when the other driver has insurance coverage, but not enough = minimum amount required for UM is $25,000BI and $50,000PD - covers hit and run auto accidents - covers insurers who are bankrupt - covers people who do not carry state limits or have any insurance - UIM coverage = insured's UIM limits - driver's BI limits

additional coverages: property removed

- provided for any cause of loss for up to 30 days while covered property is being removed due to endangerment by covered peril

Coverage A: Dwelling

- provided in all forms except HO4 - building equipment or outdoor equipment used for servicing the residence is no longer included in coverage A - contents coverage is in all HO forms, these items are in coverage C - condo HO6 combines both coverage A and coverage B in this section property covered: - dwelling on described premises listed in dec. and all attached structures - any materials or supplies located on or next to residence used to construct, alter, repair dwelling or other structures on premise - HO6 policies - include alterations, appliances, fixtures a part of building, items of real property, property which is insured's responsibility to insure as part of agreement, structures owned solely by insured other than residence premise property not covered: - land, including land on which the residence premise or other real property is located - HO6 also includes items that would normally be listed as not covered in coverage B, such as other structures held for rental to a person not a tenant of dwelling unless used as private garage, structures from which business is owned by insured or tenant of dwelling

Personal Collision Coverage:

- provides coverage for damage to your own car both collision and other-collision - loss settled based on current value of your vehicle - almost always a deductible if you need to repair or replace your car - direct and accidental loss to covered or non-owned auto

job classifications: payroll and rates:

- rated by applying bureau job classification rate to each $100 on payroll - salaries, wages, commissions, bonuses, noncash compensation, vacation pay, sick lease pay

consultants may not:

- receive commissions or compensation from any insurer or producer in connection of his/her consulting business - $250 - $2,500 fee

Coverage E - personal liability HO

- responds if a claim is made or a suit is brought against insured for damages due to BI or PD - this coverage will: = pay up to policy limits of liability for damages when an insured is legally liable = provide defense at insurer's expense by counsel of insurer's choice, even if suit is groundless, false, fraudulent - insurer can investigate and settle any claim or suit that they think is appropriate - insurers duty- to settle and defend ends when policy limit of liability for occurrence has been exhausted by payment of judgement or settlement - $100,000 basic limit of liability is included - insured may purchase higher limits for an additional premium

Coastal Barrier Resource System/Other Protected Area

- restrictions may apply if areas are defined by CMBRS or other protected are for flood insurance

HO5 form exclusions:

- same exclusions as HO3 and additional: = breakage of eyeglasses, glassware, statues, bric-a-brac, porcelains, similar fragile articles unless breakage occurs as a result of named perils listed in HO5 exclusion section = dampness, extreme temperature changes unless direct loss is caused by rain, sleet, snow, hail = refinishing, renovating, repairing property other than watches, jewelry, furs = collision (other than with land vehicle), sinking, swamping, stranding of watercraft to include trailers, furnishings, equipment, outboard engines = governmental seizure, confiscation, destruction = acts ore decisions, failure to act or decide of any person, group, organization or governmental body

duties of commissioner:

- see all laws regarding insurance companies and health care centers are faithfully executed - administer and enforce provisions in insurance code - recommend general assembly changes which in his/her opinion should be made in the laws relating to insurance - adopt further regulations - develop a program of periodic review to ensure compliance by Insurance Department w minimum standards established in NAIC - establish program to reduce costs, and increase efficiency thru electronic methods (transport documents, policy forms, rate filings)

monopolistic state funds:

- some states require employers to purchase workers comp. insurance from state-operated entity

Gen. section - 1. Policy

- summarizes all components of policy - information page = declarations page - all endorsements - any schedules constituting policy - terms may not be changed unless amended by endorsement - contract is between employer stated in information page, and insurer

guarantor or surety:

- surety or bonding company financial backing for guarantee = bond penalty - if principal, or obligor defaults on obligation, surety will pay amount specifies in the bond to obligee or insured as damages

requirements to obtain and retain license:

- surplus funds bear reasonable relationship to its liabilities based upon; type, volume, nature of business transacted - risk-based capital related to total adjusted capital must be adequate for types of business transacted

Commissioner must decide that temporary license is necessary for servicing of business:

- surviving spouse or court appointed personal representative (death or physically disabled) - member or employee of business entity = insurance producer = upon death of an individual designated in the business entity application or license - designee of a licensed insurance producer entering US armed forces - any other circumstances where Commissioner deems that public interest would be best served

Other-than-collision:

- theft - vandalism - impact with animals or birds - explosion - falling objects - windstorm - glass breakage - usually a deductible

Common Endorsements:

- towing and labor costs = $25 - extended non-owned coverage for named individual = provides coverage for non-owned autos, autos carrying property or persons for a fee, or covered vehicles in other business - miscellaneous types vehicles = expands definition of covered auto to include motorized vehicles (motorcycles, motor homes, golf carts) - joint ownership coverage = coverage for individual who own a vehicle together

Split Limit:

- under liability coverage as a whole = broken into bodily injury for each person involved, BI for entire accident, PD

Combined Single Limit:

- under liability coverage as a whole = one-dollar amount indicating maximum coverage for all losses

HO5 comprehensive forms in relation to coverages:

- unique from homeowners in that entire policy is open peril or special form - coverage A,B,C and resulting losses in coverage D are covered unless excluded

section 2 - HO - liability coverages

- unlike dwelling policy, liability coverage is included in all homeowners policy forms - liability section of all homeowners policies includes 2 liability coverages: 1. Coverage E: personal liability 2. Coverage F: medical payments to others

General Property Policy form:

- used for residential area of more than 4 units, and non-residential structures and contents - up to $250,000 for building and $100,000 personal property for other residential structures - up to $500,000 for building and $500,000 for business property for nonresidential structures

boatowners policy:

- watercraft must be used for private, pleasure use - NOT hired out, chartered, used in speed or race contest, or transport people or property for a FEE

CT workers comp insurance plan:

- workers comp coverage for employers who are unable to obtain coverage thru private insurer and are unable to self-insure - all insurers who write voluntary workers comp in CT are required to participate - applicant will submit an application for insurance and a check for premium thru licensed agent of the plan - plan will assign application to participating insurer and insurer then issues policy - employer must have been rejected by at least 2 insurers in CT - no agent can bind coverage for an employer when applying assigned risk plans - coverage becomes effective 12:01am day following date of US postmark on envelope containing application and payment are sent

Surety bonds:

- written agreement to guarantee compliance - payment - performance of an act

consultant contract:

- written form + executed + duplicate = by person receiving consultant's services (or by his/her legal representative) - one copy must be kept by person when signing - contract must specify the fees that a consultant is charging

Homeowners (liability) Endorsements (for additional premium)

-Business Pursuits - Extends liability coverage for involvement in business not owned or controlled. -Home Day Care- Extends Section II coverage. -Limited Fungi, Wet or Dry Rot, or Bacteria Coverage- covers insured's liability exposure from claims of others. -Permitted Incidental Occupancies - Necessary and incidental use of premises. -Personal Injury- Defines and adds personal injury to the policy. -Watercraft Liability -Home Business -Worker's Compensation Residence Employee

Common Carrier Cargo Liability

1. Legal Liability - A common carrier's liability is almost absolute for loss or damage to property in their custody from any cause, regardless of their negligence or lack of negligence, except from 5 sources: a. Acts of God b. Acts of a public enemy c. Exercise of a public authority d. Fault or neglect of a shipper e. Inherent vice

4 sections of a Personal Auto Policy:

1. Liability Coverage 2. Medical Payments Coverage 3. Uninsured Motorist 4. Physical Damage Coverage

Other Provisions:

1. Payment of Loss - insurer can pay money, repair or replace damaged/stolen property 2. No Benefit to Bailee - insurance will not directly/indirectly benefit any carrier or bailee 3. Other Sources of Recovery - if other insurance is applicable, insurer will pay on proportion basis. Coverage for covered non-owned auto is excess of any other collectible source that includes insurance and other sources of recovery available to owner of non-owned 4. Appraisal - insured + insurer cannot agree on settlement, either party can demand appraisal. Each party pays for appraiser. Both appraisers choose 3rd appraiser = umpire who makes final decision

commissioner

1. Transacting insurance and company approval 2. Approve policy forms, rules, and rates 3. License approval 4. Examination of records 5. Investigate unethical conduct 6. Investigation Penalties

f the personal property is in a self-storage facility or the insured's other residence, the property is covered for _____ (amount).

10% of C limit or 1000$ whichever is bigger

Ordinance or Law coverage

10% of coverage A for the increased cost to repair after a covered loss due to building codes

Building Additions and Alterations coverage

10% of coverage C HO4 only

how many license hours of CE are required to be in classroom setting

12 hour

Physical Damage -if other vehicle has physical damage

14 days, broadest coverage

Damage to the property of others

1k

producer license expires:

2 years on last day of producer's birth month - applicants can submit renewals beginning 90 days before license expiration - commissioner notifies producer of expiration date within 30 days of expiration

who is eligible for permanent exemption from CE requirements

20 years of licensure of TX

HO Special Limit Money Securities Accounts and Deeds Watercraft, trailers, engines, equipment Jewelry, watches, fur Firearms Silverware Business Personal Property- on & off residence Electronic equipment in autos

200 1500 1500 1500 (theft) 2500 (theft) fully covered otherwise 2500 (theft) 2500 on premises 1500 off premises 1500 if in or out of car while off residence

Supplementary Payments are included in the PAP with no additional premium charged. Loss of earnings is a part of the supplementary payments, and is covered up to how much per day?

200 per day

how many hours of CE are required to maintain the agent license?

24 hours 2/24 is ethics

how long is the license term

24 mo

CT Personal Auto Limits: (minimums)

25/50/25

Supplementary payments are provided by a Personal Auto Policy. What coverage is provided for the cost of bail bonds?

250

um Property damage deductible

250$ deductible , can choose UMPD or collision as primary

landlord's furnishings coverage

2500 ho2,3,5 rented space on premises - for landlord

tx vehicle weight

25k

Is personal property covered while moving it to a new principal residence? If so, how long from the start of the move would the coverage be available?

30 days

flood policy waiting period:

30 days from beginning application and premium payment - can be waived in certain circumstances surrounding new, revised loans, map revisions, or if a loan exists on a property that should have obtained flood insurance but did not - during first 30 days after a community enters emergency or normal programs, coverage begins at 12:01am, the day after application and premium payment has been mailed - existing policy is assigned to property purchaser - 12:01am on 5th day after an endorsement request and premium have been mailed on an existing policy

Commercial Property Causes of Loss

4 causes of loss forms: Basic Broad Special Earthquake (only when used with one of the above)

You are adding a vehicle to your policy. The other car on the policy right now does not have comprehensive or collision coverage because of the age of the vehicle. How much time do you have to add the new vehicle to your policy in order to have comprehensive and collision on the new vehicle?

4 days

Physical Damage -if other vehicle doesn't have damage

4 days, 500$ deductible

Truckers form:

41= any auto used only for liability coverage 42= owned autos only 43= owned commercial autos only 44= owned autos subject to no fault 45= owned autos subject to compulsory motorist law 46= specifically described 48= trailers in your possession under written trailer or equipment interchange agreement 49= your trailers in possession of anyone else under written trailer interchange agreement 50= non-owned autos only 50= mobile equipment subject to compulsory, financial responsibility, or other motor vehicle insurance law only

Debris Removal HO

5% of coverage A if significant part of the debris was personal property, the insured would also have 5% of coverage C

Complete CE requirement by the end of license discipline

50$ per hour

fire dept

500$ if fire dept is not in the district

debris removal of trees

500$ per tree / 1k total

Coverage D Loss of Use HO

: 1) additional living expense - moving into a hotel 2) fair rental value - getting lost rent Loss of Use also applies when a civil authority forces a policyholder to move out due to direct damage to a neighboring premises by a peril insured against in the policy. Only two weeks of expenses are covered in this case.

Personal Auto Parts (a-f)

A = liability B = medical payments C = uninsured motorist D = coverage for damage to auto E = duties after accident or loss F = general provisions

Parts of Auto Insurance

A Liability B Medical Payments C Uninsured motorist D Physical Damage E&F Personal Auto

Inherent Vice

A condition or defect that exists within property itself that causes the property to spoil, break, become defective, or destroy itself. Insurance policies typically exclude inherent vice. Example: The quality of materials used in a painting allows the painting to fade or lose luster with time.

Watercraft

A craft principally designed to be propelled on or in water by wind, engine power, or electric motor.

Intervening Cause

A disrupted chain of events, thus freeing the defendant from liability example: Children provoking to teasing a dog, causing it to bite or defend itself (common law)

Intervening Cause

A distrupted chain of events, thus freeing the defendant from liability Example: Provoking a dog, causing it to bite or defend

Direct Response Marketing

A marketing system that offers insurance contacts directly to the public through direct mail, newspaper, magazines, radio, TV, internet, vending machines, etc.

Pair and Sets Clause

A personal articles floater provision that allows the insurer to pay for a loss in proportion to the actual loss when a part of a pair or set is damaged or destroyed. In no case will a loss of 1 article be considered a loss of a whole

Personal Umbrella Policy

A policy covering (BI &PD) and Personal Injury Liability in excess of the insured's underlying policy limits. This provides excess coverage over the limits of an underlying policy

Market Value

A property policy provision that changes the valuation method otherwise applicable (ACV or RV) to a valuation method that allows reimbursement to the insured, according to the price a willing buyer would pay for the property purches from a willing seller

Functional Replacement Cost

A property policy provision that changes the valuation method otherwise applicable (actual cash value or replacement cost) to valuation that allows replacement with less costly property that is functionally equivalent. Example: the replacement of damaged property with identical property is impossible die to some technological or environmental change.

Unoccupancy

A property that contains personal property or contents but has no occupants is described as unoccupied.

Vacancy

A property that has neither occupants nor personal property is described as vacant.

Pro Rata

A proportional share.

Open Competition

A state relies on competition between insurers to produce fair and adequate rates

Parole Evidence Rule

A written contract is the final expression of agreement and may not be altered by prior or simultaneous oral or written negotiations without the written consent of both parties

Dwelling Policy sections

A-Dwelling B-Other Structures C-Personal Property D-Fair Rental Value E-Additional Living Expense Liability & Medical Payments Coverage can be endorsed

insuring agreement (5 Parts of Insurance Policy)

Adhesions part of the insurance policy

Aircraft Liability Insurance

Aircraft Liability - covers claims arising from the ownership, maintenence, or use of an aircraft Airport Liability - coverage for private, municipal, or commercial airports. Hangarkeepers Liability - coverage for liability arising out of damage to non-owned aircraft in the care, custody, or control of the insured.

Worker's Compensation Assigned Risk Plan

Aka: Residual Market Plan or State Insurance Fund Insurers who write Workers' Comp in states voluntary market must participate Offers Workers' Comp coverage for employers who are unable to purchase Workers Comp in voluntary market

Exam Tips:

All are true EXCEPT = there are 3 that are TRUE, I need to find the one that is NOT TRUE All are false EXCEPT = there are 3 that are NOT TRUE, I need to find the one that is TRUE All are excluded EXCEPT = there are 3 that are EXCLUDED, I need to find the one that is NOT EXCLUDED All are covered EXCEPT = there are 3 that are COVERED, I need to find the one that is NOT COVERED

Facultative Agreements

Allow the ceding insurer and the reinsurance companies an opportunity to exchange advice about the underwriting of each case

Aircraft Hull Insurance (two deductibles)

An in-motion deductible and a not-in-motion deductible. Aircraft is considered in motion whenever it is moving on the ground or in flight as a result of engine power

Bailee

An individual or organization who has taken into its care, custody, and/or control the property of another for servicing, repair, or storage

Assumed Name

An insurance agent doing business under any name other than the agent's legal name

Transit Coverage Forms (U)

Annual Transit - used to protect all property/shipments being shipped or received from other shippers during the year via any common carrier Trip Transit - used for irregular shipments, wish to insure a single shipment

A customer experiences a fire damaging a large portion of the home. The HO Coverage A is $100,000. The damages to the home total $90,000 and the cost of debris removal is $20,000. How much of the debris removal cost will be covered?

Answer: $15,000 - The first $10,000 is paid from Coverage A and $5,000 is from the Debris Removal Additional Coverage of 5% of Coverage A.

Certified Act of Terrorism

Any act, certified jointly as terrorism by the Secretary of Treasury, State and Attorney General which is at least one of the following: -Violent/dangerous to human life/property/infrastructure. -Damaging within the U.S. or on U.S. air carrier/vessel/mission. -Committed by persons on behalf of any foreign person/interest to coerce/influence the U.S. civilian/government policy.

Boiler and Machinery Insurance

Any machine subject to accidental breakdown that could destroy or damage a large part of the machine is eligible for coverage, in addition to steam boilers

Garage Coverage Form

Auto liability/physical damage coverage, plus general liability protection for businesses that are engaged in the sale, service or storage of autos Section I - Covered Autos Section II - Liability Coverage Section III - Garagekeepers Coverage Section IV - Physical Damage Coverage Section V - Garage Conditions Sections VI - Definitions

Liability Coverage Limits:

BI - pays for harm to another person PD - pays for damage to someone's else's vehicle or property ex. 250/500/100 - first digit is per person in accident - second digit is total amount per accident (no matter how many people) - third digit is property damage to someone else's vehicle or property = ex. 250/500/100 = $250,000, $500,000, $100,000

Supplementary Payments $$ Bail Bonds Appeal Bonds and interest Loss of Earnings

Bail Bonds - 250$ max Appeal Bonds - the whole amount bc we are defending you Loss of earnings - 200$ per day

Workers' Compensation Laws

Benefits must be paid for employee on-the-job injuries, regardless of negligence on anyone's part

Personal Watercraft Insurance

Boatowners Policy - similar to HO, covers boats that can be towed, property & liability Outboard Motorboat Policy - inland marine form, covers outboard motors and boats, direct property loss only Yacht Policy - ocean marine form, larger vessels, property & liability

When the insured selects Uninsured Motorists Coverage limits of 50/100, it is used to cover the insured for

Bodily injury only

Boiler and Machinery (coverage)

Boiler and Machinery Declarations Page Equipment Breakdown Protection Coverage (form) Any applicable endorsements

5 contract parts are? And definition of each

CLOAC Consideration - The value exchanged (premium for protection) Legal Purpose - contract must comply with the laws Offer - the insurance quote Acceptance - policy issued Competent Parties - People legally able to enter contract (age/mental capacity)

CT Self insurance:

CT allows for self insurance - employers must enter into agreement with employees to provide alternate system of compensation - benefits must equal state workers comp - if employee contributes anything to alternate plan, must be corresponding addition to benefits provided over and above benefits required by law - employer must file security cash, deposits, or bonds with commissioner of insurance

employers mutual insurance associations:

CT law permits employers subject to provisions of state statutes regarding workers comp to form non-stock (mutual) insurers - only employers engaged in similar business activities may participate in mutual association - subject to assessment of members for losses when association does not have sufficient funds to pay for losses - insurance commissioner must approve employers mutual insurance association - commissioner must approve that there are enough members in group to spread risk of loss - association is subject to same rules and control as other insurers

HO-5

Cadillac open perils on A B C

Contract of Adhesion (7 Contract Characteristics)

Can not change language

An insured claims a theft loss for $2,000 in jewelry, $2,200 for a gun collection and $500 for cash. Which statement is true regarding the claim payment from the homeowner policy?

Check Mark C. $1,500 of the jewelry will be paid, $2,200 for the guns and $200 for the cash will be paid

Homeowners (additional) Liability Coverages

Claim Expenses - supplementary payments - reasonable expenses at insurer's request First Aid Expenses - first aid for others, not the insured Damage to Property of Others - replacement costs up to limits Loss Assessment - a homeowners association charge against insured.

Michael trades in his 5-year old Ford with liability and physical damage on a new model on January 10th and forgets to call his insurance company. On January 15th he has an accident in the new vehicle causing damage to another car and his new vehicle. How will his auto policy respond and why?

Claim paid since it is less than 14 days after purchasing the vehicle.

Defenses (2 types)

Common Law (judicial/court decisions) Statutory Law (enactment of legislatures

Workers' Compensation types of laws

Compulsory - employers required to provide Workers' Comp benefits to employees or demonstrate the ability to provide Elective - employers have choice to accept or reject workers comp laws Monopolistic-workers comp insurance only available through state fund Competitive - workers comp insurance abailable through private insurance

Commercial Auto Coverage Section 4:

Conditions: - helps define coverage in detail - policy period - coverage territory - how coverage will apply in certain situations - appraisal for physical damage - duties in event of accident, claim, loss, suit - legal action against insurer - loss payment: insurer has options of = pay for repair or replacement = return stolen property and pay necessary repairs = take all or any part of damaged property at agreed or appraised value - subrogation - concealment - liberalization - no benefit to bailee - other insurance if more than one policy responds primary = owned auto, trailer attached, when hired auto physical damage is selected and if liability is assumed in contract = excess: non-owned autos when owned trailer is attached to non-owned auto premium audit US + territories of puerto rico, canada, anywhere in world covered auto is private passenger leased, hired, rented, borrowed for no more than 30 days - suit is based on merits of legal system - transporting covered auto is covered - two or more coverage forms or policies = highest limit of liability will apply unless policy was issued specifically to apply as excess

HO-6

Condo owners. Broad personal property. Broad A&B limited bc of condo association

Section I of HO

Coverage A - Dwelling Coverage B - Other Structures Coverage C - Personal Property Coverage D - Loss of Use

HO-3 HO-2 HO-5 HO-8 calculations of coverages

Coverage A - Primary Coverage B - 10% of A Coverage C - 50% of A Coverage D - 30% of A

HO-4 Calculations of Coverage

Coverage D is 30% of C +

HO-6 calculations of coverages

Coverage D is 50% of C

Sections II of HO

Coverage E - Personal Liability Coverage F - Medical payments

FARM:

Coverage a = dwellings b = other structures c = household personal property d = loss of use e = scheduled farm personal property = special limits = 10,000 per stack of hay straw fodder 3,000 miscellaneous farm equipment poultry is market value livestock not specifically insured is ACV 120% amount obtained by dividing limit of insurance on class and type of animal by head count at time of loss, or 2,000 for horse, mule, cattle (1 year = 1/2 of a head count) f = unscheduled farm g = other farm structures - farm buildings or structures - silos - portable buildings - fences that are corrals, pens, chutes, feed racks - outdoor radio and tv equipment - improvements and betterments - materials and supplies = 80% coinsurance h = BI and PD i = personal advertising injury j = medical payments within 3 years livestock = named peril basic = damage to machinery, death of covered livestock, damage to other farm personal property broad = basic + electrocution to covered livestock, attacks on livestock by dogs or wild animals except sheeps, accidental shootings of covered, drowning of covered, accidental death for unloading and loading special = open peril, adds exclusion for fire if caused curing tabacco

Named Peril

Coverage applies only to lossess caused by perils that are specifically stated in the policy. Example: Fire, lightning, wind, hail, aircraft, riot, vehicles, explosion, smoke, etc

Commercial Property Basic Loss (form)

Coverage includes: firem lightning, windstorm, hail, aircraft riot or civil commotion, vehicles, vandalism, volcanic action (above ground) explosion, smoke, sprinkler leakage, sinkhole collapse

Garage Coverage Form Section 1:

Covered Autos: - auto designation symbols which define types of vehicles insured 21= any auto 22= owned autos only 23= owned private passenger autos only 24= owned autos other than private passenger autos only 25= owned autos subject at no-fault 26= owned autos subject to compulsory uninsured motorists law 27= specifically described autos 28= hired autos only 29= non-owned autos used in garage business 30= autos left with you for service, repair, storage, or safekeeping 31= dealer's autos certain trailers: - 2,000lb or less - substitutes used

Commercial Auto Coverage Section 1:

Covered Autos: - auto designation symbols which define types of vehicles insured symbols: 1= any auto, owned, leased, hired, borrowed (only for liability coverage) 2= owned autos only 3= owned private passenger autos only 4= owned autos, other than private passenger autos only 5= owned autos subject to fault 6= owned autos subject to compulsory uninsured motorists law 7= specifically described autos only (year, make, model) 8= hired autos only (leased, hired, rented, borrowed other than from employees, partners, members of LLC) 9= non-owned autos only (not leased, not hired, not rented, not borrowed) - included for autos owned by employees, partners, members if an LLC (if used in insured's business or personal affairs 19= mobile equipment subject to compulsory, financial responsibility, or other motor vehicle insurance law only **commercial auto policy does not use 'your covered auto' definition like PAP - symbols are a critical part of form = granted coverage in form NEWLY ACQUIRED AUTOS: - if symbols 1 2 3 4 5 6 are shown of coverages, policy will also apply to any additional autos of same type - symbol 7 = applies only if insurer already covers all autos owned by insured OR if newly acquired vehicle is replacing prev. owned auto that had coverage - must inform insurer of coverage within 30 days of acquiring auto CERTAIN TRAILERS, MOBILE EQUIPMENT, TEMPORARY SUBSTITUTES: - trailers with a load capacity of 2,000 pounds or less - mobile equipment while being carried or towed by covered auto - temporary substitute vehicles used while covered auto is out of service due to breakdown, repair, servicing, loss, destruction

Commercial Property Building and personal Property Coverage (form)

Covered Property: Building or structure described in declarations Business personal property personal property of others

Comparative Negligence

Damages are reduced in proportion to the degree of negligence (statutory law)

Dwelling (other coverages available)

Debris Removal Impreovements, Alterations, and Additions Reasonable Repairs Property Removed Trees, Shrubs and other Plants Fire Department Service Charge Collapse Glass or Safety Glazing Material

Homeowners (additional) Property Coverages

Debris Removal (remove debris left from loss) Reasonable Repairs (protect from further loss) Trees, Shrubs and Plants (damage up to $500) Property Removed (protect property 30 days off premises of insured) CC, ETF card, Forgery, Counterfeit Money (theft, unauthorized use) Loss Assessment (from homes association) Collapse (hidden decay, weight, defective material) Glass or Safety Glazing Material (breakage) Landlord's Furnishings (contents when rented to others) Ordinance of Law (loss caused during enforcement) Grave Markers (theft or damage)

Other Coverage DP-1 DP-2 DP-3 Debris Removal Repairs Property removed to protect Fire Dept. Trees Shrubs and Plants Collapse Glass Building ordinance or law

Debris Removal- Reimbursed from the applicable coverage DP123 Repairs - reasonable costs DP123 Property removed- DP1 5 days, DP2&3 30 days Fire- 500$ addtl insurance Trees Shrubs and plants - dp 1 none, dp23 5% of Cov. A - 500 per tree (addtl insurance) Collapse - dp1 none, included dp23 Glass - dp1 none, dp23 included unless vacant more than 60 days Building ordinance - dp1 none, dp23 10% of Cov A

Commercial Package Policy (4 key components)

Dec Page Conditions (legal obligations of insured and insurer) Interline Endorsements (coordinate coverage between parts) One or more of Coverage Parts

Which portion of the auto policy contains the coverage and limits the customer selected?

Declarations

5 parts of Insurance Policy

Declarations Insuring Agreement Conditions Exclusions Definitions

Definitions (5 Parts of Insurance Policy)

Define terms like You and Your - insured We and us - company bodily injury prop damage insured location occurrence residence premises

Garage Coverage Form Section 6:

Definitions: -

Commercial Auto Coverage Section 5:

Definitions:- terms and phrases - (CA) = commercial auto - CA coverage form has key definitions at the end of the policy Auto: land motor vehicle, trailer, semitrailer designed for use on public roads and any other land vehicle subject to compulsory financial responsibility laws where it is licenses or principally garaged - auto does NOT include mobile equipment

Motor Carrier Act of 1980

Department of Transportaion (DOT) requires: -Motor carrier must carry an insurance policy of certain minimum limits, or -Post a surety bond representing certain financial stability criteria when transporting passengers or cargo.

DIC

Difference in conditions: - property insurance policy written to supplement named perils property - no standard policy - manuscripted and tailored to specific needs of insured - all-risk coverage - excluded named perils provided by policy it supplements - contains no coinsurance clause or pro rata sharing provision - written in high deductible $10,000 or more - written to provide flood and earthquake damage

Special Form Perils

Dwelling and Homeowners Policy: The dwelling and other structures are covered for all direct physical damage (open peril), except for perils specifically excluded

Homeowners (property) Endorsements (for additional premium)

Earthquake Home Day Care (children) Personal Property Replacement Cost (increase coverage for full recovery) Scheduled Personal Property (for scheduled property with a specific amount of coverage) Limited Fungi, Wet or Dry Rot, Bacteria Coverage (testing and removal) Permitted Incidental Occupancies (additional coverage when residence used for business)

National Flood Insurance Program NFIP

Emergency program when the community applies. 35k for building/10k contents Regular program has limits of 250k building/100k contents 30 day waiting period

express authority

Employee at XYZ insurance using the company letterhead to introduce herself written or oral power

National Flood Insurance Program

Enables property owners to purchase federal flood insurance. Administered by Federal Emergency Management Agency (FEMA)

Liability Policies (misc types)

Excess Liability Policy Personal Umbrella Commercial Umbrella Medical Professional Insurance Errors and Omissions Fiduciary Liability Liquor Liability Employment Practices Liability Insurance

Those exempted from Workers Comp

Farm Laborers Domestic Servants (maid/butler) Casual Workers (work is nonrecurring.. not part time employees) Independant Contractors

FEMA

Federal Emergency Management Agency

Federal Workers' Compensation Laws

Federal Employers Liability Act - interstate railroad workers U.S. Longshorement and Harbor - those who load, unload, build, or repair ships (not crew) Jones Act - crews on ocean vessels Federal Employees Compensation Act - U.S. civilian government employees

Truckers Coverage Form

For those firms or persons that are in the business of transporting goods or commodities for another Section I- Covered Autos Section II - Liability Cov Section III- Trailer Interchange Coverage - covers trailer that ind does not own but has in his possession along with a written Trailer Interchange Agreement Section IV - Physical Damage Coverage Section V- Truckers Conditions Section VI- Definitions

Commercial Crime Coverage Forms

Form A - Employee Theft Form B - Forgery or Alteration Form C - Theft, Disappearance and Destruction Form D - Robbery and Safe Burglary - other than Money/Securities Form E - Premises Burglary Form F - Computer Theft and Fund Transfer Fraud Form G - Extortion Form H - Premises Theft/Outside - other than Money/Securities Form I - Lessee's Safe Deposit Box Form J - Securities Deposited with Others Form K&L - Guest's Property Form M&N - Safe Depository Form O&P - Public Employee Dishonesty Form Q - Robbery and Safe Burglary Money/Securities Form R - Money Order and Counterfeit Paper Currency

Terrorism Risk Insurance Act

Funds coverage for potentially catastrophic events due to acts of terrorism. Applies to all property insurance

Garage Coverage Form Section 5:

Garage Conditions: - similar to business auto coverage form - businesses that haul goods for others is not under business auto or garage coverage = truckers coverage form - common carriers who transport goods for anyone - contract carriers who have written contracts with other companies to haul merch - businesses that use their vehicles to transport their own good are = private carriers difference between trailer and semitrailer = trailer has front and rear wheels, semi trailer has attachment of a fifth wheel device 2,000lbs or less

Garage Coverage Form Section 3:

Garage-keeper's: - covers damage to customers' auto left in insured's care = comprehensive = specified cause of loss = collision - comprehensive = all loss to customer's auto except collision or overturn specified causes of loss = loss to customer's auto due to fire, lightning, explosion, theft, mischief, vandalism collision = loss to customer's auto caused by hitting object or overturn - insurer has right and duty to defend insured - insurer can investigate and settle claims - duty to defend ends when policy limits are gone - garage keepers coverage is only triggered when insured is legally liable for damages = legal liability or standard option - direct coverage option = coverage triggered without regards to liability, additional premium - excess insurance option - primary insurance option Extensions: $250 a day for time off from work - costs and bonds Exclusions: - contractual obligations - theft - defective parts - faulty work - war - loss due to tape decks, sound reproducing equipment unless perm. installed, sound receiving, scanning monitor, antennas unless perm. installed, radar detection

boatowners:

HO = $1,500 - damage to watercraft, accessories, equipment, trailers - liability coverage of 50hp outboard, and 25hp inboard, 26 feet long - additional protection can be found in endorsement or thru purchase of boatowners policy

Homeowners Policies

HO Forms: 2,3,5,8 are for owner-occupant of a dwelling that is used principally for private residential purposes HO Forms: 4(tenant) and 6(condominium unit-owner) are written to insure the personal property and liability of occupants, but do not cover the structure

Homeowners Coverage Forms

HO-2 (broad form) HO-3 (special form) HO-4 (contents broad form; renters or tenants form) HO-5 (comprehensive form) HO-6 (condominium unit-owners form) HO-8 (modified form for older homes)

Elaine is on vacation in Europe when all of her luggage was stolen. How will her HO policy respond if she files a claim?

Her HO policy will cover the loss less her deductible.

Ocean Marine Policy Coverages

Hull Insurance (ship itself) Cargo Insurange (goods being shipped) Freight Insurance (freight charges and import duties) General Average (loss is apportioned or shared among all) Particular Average (loss affects only a particular interest) Collision/Running Down Clause (collision with another vessel) Inchmaree Clause (burst boiler, broken propeller, crew navigation errors)

Commercial Property Building and Personal Property Coverage Form (extensions of coverage)

If coinsurance threshold of 80% or more is met: Newly Acquired or Constructed Property Personal Effects and Property of Others Valuable Papers and Records Property Off Premises Outdoor Property Non-Owned Detached Trailers

Commercial Property Building and Personal Property Coverage Form (additional coverages)

Included with no additional premium: Debris Removal Preservation of Property Fire Department Service Charge Pollutant Clean Up and Removal Increased Cost of Construction Electronic Data

Personal Contract

Insurance policies cover the insurable interest of the insured. The insured cannot transfer or assign any policy, except life insurance

Commercial Crime Insurance

Insurance that covers (1) money and securities against numerous perils (not limited to crime perils) and (2) property other than money and securities against crime perils, such as employee theft, robbery, theft by outsiders, and extortion. - can be added to a commercial package policy or written on a monoline basis. - all risk or open peril basis - peril of theft is not included in basic and broad cause of loss forms - special cause of loss = exclusions for dishonest acts of employees and sublimit jewelry, furs, patents, molds, stamps - 2 policies = commercial entities and government entities = insured can select a form that has different coverage triggers = discovery forms or loss sustained form = trigger differences have made similarities to general liability form - occurrence and claims made - regardless of form chosen, crime policy consists of separate coverages that can be selected by insured - each coverage has its own insuring agreement, conditions, and exclusions page - dec. page of a crime policy will activate the appropriate coverages within policy - crime dec. = employee theft/employee dishonesty, forgery and alteration, inside theft of money and securities, inside robbery or safe burglary of other property, outside premise, computer fraud, fund transfer fraud, money order and counterfeit paper currency

Professional Liability Insurance

Insurance that covers persons engaged in various occupations against liability resulting from their rendering or failing to render professional services - protects against malpractice - written on a claims-made basis - lawyers = lawyers professional liability - doctors - surgeons - dentists

Prior Approval

Insurers cannot use rates until approved by the DOI, or until a specific time has passed after the filinf without being disapproved

What is the part of the policy that stipulates the terms of the policy including property coverage and perils insured against?

Insuring Agreement

Inland Marine Insurance Jewelry Furs Fine Art Silverware Coin and Stamp Firearms

Jewelry - open perils. new jewelry is insured for 30 days up to 25% of the total coverage no more than 10k. no deductible. covers theft and mysterious disappearance Furs - open perils. covers theft. no deductible. 30 days 25% up to 10k Fine Art - valued basis. no deductible. automatic coverage for new art 25% for 90 days Silverware - open perils no ded covers theft Coin/stamp - open perils, doesn't cover fading creasing or mailing Firearms - open perils

voluntary association of individuals who agree to share insurance contracts. These individuals are individually responsible for the amounts of insurance they write

LLoyds association ex. insure beyonces voice

Statute of Limitations

Length of time in which a person may file suit

Commercial Auto Coverage Section 2:

Liability Coverage: - designated how much a policy will pay for bodily injury or property damage to third parties - insured's ownership, maintenance, or use of any covered auto - pollution expenses resulting from accident caused by ownership, maintenance, or use of covered auto resulting from BI or PD Who is an insured: - person or organization named in dec. for any covered auto - anyone else while using covered auto (from whom an insured hires or borrows an auto other than trailer - someone using a covered auto in business selling, repairing, servicing, parking, storing autos unless the business is owned by insured - anyone, other than employees, partners, lessees, borrowers while moving property property from covered auto - employees and partners for autos they own - anyone liable for insured's conduct, considered an insured, but only to extent of his or her liability Extensions: - following supplementary payments: = all expenses the insurer incurs = up to $2,000 for bail bonds = costs of bonds to release attachments = reasonable expenses incurred by insured at insurer's request including up to $250 per day for time off work = costs taxed against the insured in any suit = accrued interest on any judgement = out of state coverage: vehicle is driven in state not licensed in - extension provides increased liability protection to meet financial responsibility requirements in other state - does NOT APPLY to carriers of property or people, extension will also provide minimum amounts of other coverage such as 'no-fault- Exclusions: liability coverage exclusions listed in this section of policy form = expected or intended injury or damage = contractual liability other than contractual contract = obligations under any workers comp., disability benefits, unemployment or similar law = employee indemnification and employer's liability = bodily injury to any fellow employees of the insured caused by fellow employee's employment = property damage or covered pollution cost or expense involving property owned or transported by an insured or in insured's care, custody, control = bodily injury or property damage resulting from handling of property before or after it has been moved = movement of property by mechanical device unless device is hand truck, or attached to covered auto = bodily injury or property damage caused by operation of mobile equipment or machinery or equipment attached to part of a vehicle that would be defined as mobile equipment if it were not subject to compulsory or financial responsibility laws = losses resulting from completed operations (work after it has been completed and is no longer in the hands of insured) = losses due to pollution that occurs from operating a covered auto, while pollutants are being transported, loaded, unloaded from covered. However there is coverage when pollution is from object other than a covered auto, in which loss is caused by a covered auto = war = racing, demolition or stunts including preparing for activities Limits of Insurance: - limits for BI and PD can be expressed as single or split limits single limits: total amount insurer will pay for all BI/PD including pollution expenses from any single accident

A PAP insured is towing a rented trailer. The trailer comes loose, damages property and injures people. Which best explains how the PAP would respond?

Liability limits apply for bodily injuries & property damage. Policy would also respond to the non-owned trailer damage less the deductible.

Named Non-owner

Liability med pay and UM to people who do not own an car to cover them when driving car owned by others ex. DUI person

Garage Coverage Form Section 2:

Liability: - garage operations = other than covered autos - garage operations = covered autos - insured must be legally liable for loss in order for coverage to apply other than covered autos: loss must be a direct result from insured's garage operations covered: insurance w/ protection from losses resulting from ownership, maintenance, use - pollution is also covered garage operations: other than covered autos insured means = individual or organization named in dec. or partners, employees, directors, officers, shareholders while acting in position coverage extensions: same as out of state coverage extension in business auto coverage form Exclusions: - expected or intended injury - contractual liability - workers comp. - employee identification and employers liability - fellow employee - care custody control - leased autos - pollution exclusion applicable to other than covered autos = due to discharge, dispersal, seepage, escape of pollutants on garage premises - pollution exclusion covered autos - racing - water or air craft - defective products - work performed - loss of use other than accidents - products recall - war - distribution of material in violation = telephone consumer protection act CANSPAM 2003 - per accident limit that insurer must pay for a single loss - covered autos is per accident not subject to annual aggregate - non-covered = aggregate - deductible provision: $100 ded. property damage to autos due to work done by insured's business

Mine Subsidence

Loss caused by the collapse or movement of structures resulting from the caving in of underground mines.

Federal Motor Carrier Safety Administration

MCS-90 must be attached to all motor carrier policies

Workers Comp premium computation

Manual Rating - rates based upon job classification Experience Rating - rates based on employers prior loss experience Premium Discount - larger employers receive discount, as credit for expenses which do not increase proportionately Participating Plans - premum refunded, if loss experience falls w/in guidelines Retrospective Rating - initial premium is charged, then adjusted at end of policy period to reflect actual loss experience

Workers Compensation Benefits

Medical Benefits Disability Income Benefits Rehabilitation Benefits Death and Survivor Benefits (funeral expenses)

HO-3

Most common. broad coverage for personal property and open peril for loss to A and B

NFIP

National Flood Insurance Program - floods cause more property damage in US than any other type of natural disaster - created by fed. gov. to fill gap left by private insurers - administered by FIMA (a part of FEMA) - 1968 congress created NFIP to rising cost of taxpayer disaster relief for flood victims and increasing amount flood damages

Malpractice

Negligence by a professional person such as a doctor, or lawyer

Aftermarket Parts

Non original equipment made by a manufacturer other than the auto maker

Commercial General Liability coverage forms

Occurence Form Claims-Made Form

Contract of Adhesion

One party prepares a contract and submits it to the other party on a "take-it-or-leave-it" basis (without negotiation)

Unilateral Contract

Only one party is legally bound to contractual obligations after the premium is paid to the insurer. Only the insurer has made a promise of future performance, and only the insurer can be charged with breach of contract

Homeowners (property) Exclusions

Ordinance or Law (loss caused during enforsement) Earth Movement (earthquake, landslides, mine substinence, sinking) Water Damage (flood, tidal water, overflow, or back up of sewer/drains/sump) Power Failure (interuption away from premises) Neglect (failure to protect) War (civil, insurrections, rebellions, revolutions) Nuclear Hazard (reaction or radioactive contamination) Intentional Loss (burn your own house) Government Action (during confiscation or seizure)

Other Coverage DP-1 DP-2 & DP-3: Other Structures Tenant Additions and Alterations Property away from Premises Fair Rental Value

Other Structures: DP-1 = 10% of Cov. A, 10% of Cov. A - addtl insurance Tenant Additions: DP-1 = 10% of Cov. C, 10% of Cov C - addtl insurance Property Away from Premises: DP-1,2,3 = 10% of Cov. C Fair Rental Value: DP-1 = 20% of Cov. A at 1/12th per month, DP-2 &3 20% of Cov. A (addtl insurance)

Which of the following statements accurately describes how transportation expenses work in the auto policy?

PAP provides $20/day and additional limits may be purchased by endorsement.

Aleatory Contract

Parties to a contract exchage unequal amounts of money. In insurance, the premium paid is less than the potential benefit to be received in the event of a loss. Performance depends on an uncertain future event. The exchange in values may be unequal.

Grave Markers additional coverage

Pays up to $5,000 for grave markers, including mausoleums, on or away from the "residence premises" for loss caused by a covered peril under Coverage C.

Personal Articles Floater (examples)

Personal Jewelry Floater Personal Effects Floater (items worn by travelers) Fine Arts Floater (paintings, manuscripts, antiques) Camera Floater Musical Instrument Floater

Commercial Auto Coverage Section 3:

Physical Damage Coverage: - coverage for damage done to insured's property including any covered autos - physical damage is personalized in each CAP comprehensive coverage: loss or damage to covered auto by any cause other than collision or overturn specifies cause of loss coverage: loss to covered auto if caused by fire, lightning, explosion, theft, mischief, vandalism, windstorm, hail, earthquake, sinking, burning, collision, derailment collision coverage: losses to covered auto resulting from collision with object or overturn towing coverage: labor costs due to disabled auto glass breakage: hitting bird, falling objects, missiles = insured does not have option of collecting for glass damage under collision coverage if loss results from collision with object or overturn Extensions: - transportation expenses: $20 day, $600 THEFT (covered auto, private passenger type) Must be insured for comprehensive or specified causes of loss - comprehensive coverage is after a 48 hour waiting period Loss of use expenses: insured legally liable for loss of use of vehicle rented or hired without driver under written rental contract - if coverage is purchased, coverage extension will pay for loss of use of damaged $20 per day, $600 max. EXCLUSIONS: - nuclear hazard - war and military action - racing, demolition, stunt - wear tear, freezing, mechanical breakdown, tire damage - loss to sound equipment other than installed designed for reproduction of sound Limits of Insurance: - physical damage limit is lesser of: ACV at time of loss and cost of repairing or replacing damaged or stolen property max. loss of audio, video, data equipment $1,000 if permanently installed deductible: amount of any loss will be reduced by amount of deductible shown in dec. any comprehensive ded. will not apply unless by fire or lightning

Garage Coverage Form Section 4:

Physical Damage: - similar to business auto coverage form with additional exclusions

Physical Damage Limits: Physical damage Non owned trailer Electronic equipment

Physical damage - actual cash value or the amount needed to repair or replace the property whichever is less minus your deductible Non owned trailer - 1500 Electronics - 1000

Policy Holder conditions

Policy - what the insured can and cant do with the policy Property - conditions related to the insured property Claims Honesty

Pro Rata Formula

Policy amount/insurance available total = % to be paid * loss

Contributory Negligence

Prevents recovery for damages caused by a negligent party if the claimant was also negligent (common law)

Boiler and Machinery Equipment Breakdown Protection Coverage (Form)

Property Damage Expediting Expenses Business Income and Extra Expense Spoilage Damage Utility Interruption Newly Aquired Premises Ordinance or Law Errors and Omissions Brands and Labels Contingent Business Income and Extra Expense

Ocean Marine Insurance

Protect against losses to property while being chipped by ocean, or inland waterways. Unregulated in regard to forms and rates

Inland Marine Insurance

Protects against losses to preoperty that is mobile in nature (across land), primarily while property is away from the owner's premises

Aircraft Hull Insurance

Provides coverage on an open peril basis for physical loss or damage to the insured aircraft, on ground, or in flight. In flight is from the moment it moves forward for takeoff until it completes its landing run.

File and Use (rate approval)

Rates must be filed with the state insurance regulatory authority (Dept or Division of Insurance), and may be used as soon as they are filed

HO-4

Renters/Tenants. NO A or B. Broad coverage C

limited to organizations or persons engaged in similar businesses or activities who are exposed to the same types of liabilities

Risk Retention / Purchasing groups ex: United educators

Which term best describes when property is unlawfully taken from someone by threat of bodily harm?

Robbery

Commercial General Liability

Section I - Coverages Coverage A - BI and PD liability Coverage B - Personal and Advertising Injury Coverage C - Medical Expense Section II - Who is an Insured Section III - Limits of Insurance Section IV - Conditions Section V - Definitions

Business Auto Coverage Form

Section I - Covered Autos Section II - Liability Coverage Section III - Physical Damage Coverage Section IV - Business Auto Conditions Section V - Definitions

certified insurance consultant remains in force until:

Sept. 30th of each odd numbered year unless revoked/suspended

Investigative Consumer Report

Similar to consumer reports in that they also provide information on the consumer's character, reputation, and habits. - primary difference is that the information is obtained through an investigation and interviews with associates, friends, neighbors - reports cannot be made unless consumer is advised in writing about report within 3 days of the date the report was requested - consumers can request additional information concerning the report - insurer or reporting agency must report within 5 days to provide consumer with additional information

Workers Comp Self Insurance Plans (employer groups)

Some states allow employers to self-insure when able to guarantee their ability to meet their workers comp obligations Usually required a self-insurance certificate and surety bond

Mandatory Rates

Some states require that mandatory rates be used for certain lines of insurance.

Hazard

Something that increases the chance or likelihood of a loss occuring. (physical or moral or morale)

Abandonment of Property

Specifies that the insured may not abandon or relinquish ownership of damaged property to the insurer for disposal or repair

Insurable Interest (limit of liability)

Specifies that the insurer will not be responsible for an amount which is greater than the financial interest of an insured person or more that the limit of liability stated on the Declarations Page

Conditions

Specifies the general rules(obligations) that the insured and insurer have agreed to follow throughout the policy period, such as the insured's responsibilities in the event of a loss

Apportionment (pro rata liability/other insurance)

Specifies the process to be followed when more than one policy covers the same loss.

Bonds (2 types)

Surety Bonds (performance bonds) - guarantee that specific obligations will be fulfilled Fidelity Bonds (honesty bonds) - cover employers from direct loss due to fraudulent or dishonest acts (theft) by their employees

Terrorism Risk Insurance Act Exclusions

TRIA covers all commercial lines of property & casualty insurance except: Federal and private crop and livestock Private mortgage Financial Guaranty Medical Malpractice Federal Flood Reinsurance

Workers' Compensation Disability Income Benefits

Temporary Total - expected to recover and return to work, but unable to work while recovering Permanent Total - unable to do any work for the res of life Temporary Partial - able to do some work, but is unable to earn usual wage until full recovery. Permanent Partial - able to do some work, but will never fully recover Scheduled Injuries - listing of benefits that apply for each specific permanent partial injury (loss of eye, hand etc)

Deductible

The amount of money which the insured party must pay before the insurance company's own coverage plan begins.

Declarations Page

The basic information about a policy: Who - names of insurer and insured What - description of insured property Where - address and legal description of insured property When - effective and expiration dates. How Much - limits of coverage, deductible, premium

Peril

The cause of a possible loss.

Automatic Agreements

The ceding company must transfer the amount of insurance in excess of the retention level immediately and automatically upon receipt of the premium

Garagekeepers Coverage

The insured may elect one of the following: Legal Liability Basis - coverage applied only if the garage is legally liable Direct Excess Basis - coverage applies regardless of liability, but only if customer has no physical damage coverage of their own Direct Primary Basis - coverage applies regardless of liability, and regardless if customer has any physical damage coverage of their own

Premises

The interior of that portion of a building occupied by the insured to conduct business

Law of Large Numbers

The larger the number of exposures considered, the more closely the losses reported will equal the underlying probability of loss. Only applies to homogeneous groups

Policy Limit:

The maximum amount the insurance company will pay for a particular loss, or while your insurance policy is in effect

Assumption of Risk

The plaintiff who consciously exposes himself to danger assumes some risk of possible injury example: A river rapids excursion participant (common law)

Actual Cash Value (ACV)

The policy pays for the cost to repair or replace the damaged property at the time of loss, less depreciation

Replacement Cost

The policy pays the full cost to replace or repair the damaged property (not exceeding policy limits) at the time of the loss without an adjustment for depreciation

Right of Salvage

The right of the insurer to take possession of damaged property after the loss to the property has been paid. The salvage belongs to the insurer.

Condominium Commercial Unit- Owners Coverage (form)

This form is used for commercial unit-owners instead of the HO-6 (which is used for residential unit-owners)

Claims-Made Form

This form provides for the defense and payment of claims, for which the insured is legally liable. Same coverage as an Occurrence Form, but is of particular significance to risks that have the potential to generate claims years after an occurrence that caused injury or damage.

Pollution Liability Coverage

Three options to adding pollution coverage back to a CGL policy: Pollution Liability Coverage Form Limited Pollution Liability Coverage Form - identical to above, but does not include clean up costs. Pollution Extension Endorsement - deletes pollution exclusion, but continues to exclude cleanup costs

Motor Truck Cargo Forms (U)

Truckers Form - insures public truckers for legal liability arising out of loss/damage to cargo belonging to others Shippers Form - Covers shipper's own goods Owners Form - covers business that owns the trucks in which it transports its own goods

Contribution by Equal Shares

Under this concept, when 2 or more insurers' policies cover at the same level (Primary or Excess), each insurer contributes an equal amount to the loss settlement until the loss is paid, or until each insurer has exhausted its limits of insurance, whichever comes first. Example: If there are 3 insurers participating, each would pay 33 1/3 percent of the loss; if 4 insurers participating, each would pay 25 percent of the loss; or if 5 insurers participating, each would pay 20 percent of the loss.

Personal Inland Marine Insurance

Used to insure moveable personal property against direct loss

Motor Carrier Coverage Form

Variation of the Truckers Coverage Form: Trucker - engaged in the business of transporting property for hire Motor Carrier - engaged in transporting property or passengers

Worker's Compensation Selected Endorsements

Voluntary Compensation Endorsement - extends Worker's Comp coverage to employees even if the law doesnt require the employer to provide coverage. Foreign Coverage Endorsement - around the clock, continuous for those employed in foreign operations

Nationwide Marine Definition

Wet insurance and Dry insurance are terms that the Nationwide Marine Definition uses in specifying risks that may be written under marine insurance. The National Association of Insurance Commissioners adopted the Nationwide Marine Definition that defines 6 broad classes of property that may be insured under marine contract The classes are: 1. Imports 2. Exports 3. Domestic Shipments 4. Instrumentalities of Transportation or Communication (i.e. bridges, tunnels, antenna towers) 5. Personal Property Floater Risks (as discussed in Chapters 3 and 9) 6. Commercial Property Floater Risks

Declarations (5 Parts of Insurance Policy)

Who- who the insurance company is and who is the insured what- what property is covered when- term where- geographic how- how much coverage apply

DP Peril Limitations

Windstorm & falling objects for signs antennas boats and trees not covered Weight of Ice - excludes fences patios pools docks Windstorm & falling objects - only covered when it damages roof or outside wall first Freezing- if owner doesn't take reasonable care Smoke - dp1 doesn't cover fireplace smoke Vehicles - damage to fence driveway or walk

Ocean Marine Policy

Written "full value" ad will become void if certain implied warranties are violated: Legality-legal goods Seaworthiness - seaworthy ship/competent crew No Deviation in Voyage - sail the course filed with the insurer.

Endorsements

Written amendments attached to the policy to broaden or restrict coverage, or to further define certain policy provisions.

consumer reports:

Written/oral information regarding a consumer's credit, character, reputation, or habits collected by a reporting agency from employment records, credit reports, and other public sources.

Theresa is calling as her vehicle sustained extensive damage due to flooding after a recent storm. Does her PAP provide coverage for flood?

Yes, flood is covered under her Other Than Collision coverage.

Peril

a cause of loss

insurers can appoint:

a producer to all or some of the affiliated companies by filing a single appointment request, provided commissioner has implemented electronic system capable of processing filings and has previously notified insurers that such filings are acceptable

insurance producers may not:

act as an agent of an insurance company unless producer becomes appointed by the insurer

other ways to earn CE credit

active members of national or state insurance pass professional designation take university classes

voluntary compensation endorsement:

added to workers comp policy - statutory coverage for employees who do not fall under state's comp act such as: types of farmworkers, domestic employees working fewer than 40 hours a week - insurer will pay statutory benefits to insured person in exchange for injured worker releasing employer and insurer from further liability - if employee does not sign release, further compensation under endorsement ends

Cancellation and non-renewal

after 60 days can cancel if: - non-payment - loss of license of one of regular operators - renewal, during policy period or 180 days immediately preceding policy renewal date terminate before first 60 days w no payment = 15 days notice no pay with subsequent payment due = 10 days

cease and desist order

after a hearing, if the commissioner deems the person in an unfair method of competition or an unfair/deceptive act or practice, commissioner then can issue a cease and desist order. - legally requires person to stop engaging in acts, methods, or practices that violate the insurance code

general HO form structure:

agreement definitions section 1 - property coverage section 1 - perils insurance against section 1 - exclusions section 1 - conditions section 2 - liability coverages section 2 - exclusions section 2 - additional coverages section 2 - conditions section 1 and 2 - conditions

Commercial Ocean Marine Liability Insurance

aka. Protection and Indemnity Covers legal libaility imposed on the insured for damages arising out of the operation of the insured vessel

DP-3 Special

all features of dp-2 and covers buildings for open perils. Replacement cost for coverages A B, ACV for personal

co insurance formula

amount of insurance purchased / (value of property * 80%) = loss settlement percentage

Endorsement

an amendment to an individual policy that reflects any changes to the standard policy

insurer must pay: for each producer

an appointment fee, and a renewal fee for each producer it appoints - an insurer that appoints a producer to more than one of its affiliates must pay the fee for each company where the producer is appointed

surety bond itself is similar to:

an insurance policy itself - surety guarantees that an outcome will occur as contracted and if it does not, bond will pay the financial consequences

in order to transact insurance as a representative of an insurance company:

an insurance producer must be appointed by that insurer (insurer must file notice to insurance department within 15 days of when agency contract is executed or first application is submitted to insurer by producer)

all other buildings covered under dwelling:

and contents of other buildings are insured on ACV

Rebating:

any Inducement offered to insured in sale of insurance that is not specified to policy - both offer and acceptance of rebates are illegal - rebates of premiums payable on policy - special favors or services - advantages in dividends or other benefits - stocks, bonds, securities, and their dividends or profits

controlled business:

any coverage written on producer's own life, health, or property, and/or that of the producer's immediate family or business associates. - not allowed to collect commission on controlled above state limit - not issue a license to a person if use is for writing controlled business - premiums from controlled business policies exceed 9 times the limit on premiums on policies issued to general public, commission will suspend or non-renew producer's license

who can apply to the commissioner for an insurance license?

any individual or business

standard deductible amounts:

apply separately to building and contents losses, with higher deductibles available

insurance producer

appointed by an insurer to act on insurer's behalf

ratification

approval of policy forms endorsements rates filings and rights

producers licensed in another reciprocal state who furnish evidence of compliance w other states CE laws:

are also exempt from CE courses

Endorsements

attached policy that changes policy in some way 1)changes to an existing policy 2) additions to a policy

Liability, Medical Payments, Uninsured Motorist -Newly acquired car replacing one on policy

automatically has the broadest coverage

single family dwellings:

automatically provided with replacement cost if insured at 80% replacement value or maximum under regular flood insurance

section 2 - conditions (liability)

bankruptcy of an insured: will not relieve insurer of obligations under policy limit of liability: total limit shown in dec. is insurer's total liability for any one occurrence regardless of number of suits or claims - insurers duty to settle or defend ends when limit of liability for occurrence has been exhausted by payment of judgement or settlement severability of insurance: insurance applies separately to each insured - does not increase insurer's liability for any one occurrence duties after occurrence: - give written notice to insurer or agent as soon as possible that identifies: - identity of policy and named insured - reasonably available information on time, place, circumstance of offense - names and addresses of claimants and witnesses + additional duties: - cooperate with insurer in investigation, settlement, defense of any claim or suit - promptly forward insurer every notice, demand, summons, or other process relating to offense - at insurer's request, assist insurer in: = making settlement = enforcing any right of contribution or indemnity against any person who may be liable to an insured = conducting suits and attending hearings and trials = securing and giving evidence, and obtaining attendance of witnesses + - insureds may not except at their own cost, voluntarily make payments, assume obligation, or take on expenses other than first aid at time of personal injury - assist the insurer in subrogation rights - if loss involves property damage to others, submit to the insurer a signed, sworn proof of loss within 60 days of their request + - if insured fails to comply with requirements, insurer has no obligation to provide coverage duties of injured person: coverage F (medical payments to others) injured parties or someone representing injured party must provide insurer or agent written proof of claim, authorization to obtain medical records. - injured person also submits physical examination by doctor of insurer's choice as often as requested payment of claim: coverage F (medical payments to others) payment of any claim under medical payments section is not considered an admission of liability by insured or insurer suit against insurer: no action may be brought against insurer until all policy provisions have been complied with, and no one has a right to join insurer in any action against insured other insurance: coverage E (personal liability) insurance will be considered excess over any other valid and collectible insurance, unless other insurance is intended to be excess coverage (umbrella liability policies) policy period: coverage only applies to losses that occur during policy period

HO-8

bare bones basic for A B C

workers comp. and employers liability:

based on national council on compensation insurance (NCCI) standard policy although they may contain slight variations by different insurers

TPD payouts:

benefits expressed as percentage of lost wages equal to difference between wages earned before and after injury - some states provide schedule of benefits for specified partial disabilities for an addition to other benefits paid

exclusive remedy

benefits provided under workers compensation are sole remedy, employees cannot sue for additional damages

supply bond:

bonds guarantee that supplied will furnish supplies, materials, products, and equipment as specified in written contract

Utmost good faith (7 Contract Characteristics)

both parties will deal with each other honestly and fairly

Intervening cause

breaks the chain of events and typically impacts the insurance policy's responsibility for the loss ex. delaying a claim that causes mold

rebating

bribe

Package Policy

bundles property and liability together

temporary partial disability: (TPD)

can do some work, but not full job and will return to full work capacity

certified insurance consultant

can examine insurance and annuity contracts and make recommendations for a FEE

false advertising

cannot contain any untrue, deceptive, misleading statements that apply to anyone in insurance - advertise, circulate, any materials - false or deceptive advertising specifically includes: misrepresenting the following: = terms, benefits, conditions, or advantages of any insurance policy = any dividends to be received from the policy or previously paid out = financial condition of any person or the insurance company = true purpose of an assignment or loan against a policy using shares of stock, using names or titles that may misrepresent the true nature of the policy are also false advertising - person of entity cannot use a name that deceptively suggests it is an insurer

how to check current compliance with CE requirements

cercon.com , expires after a year have to retake test

risk

chance or potential of financial loss

insurance code:

commissioner examines books and records of any insurance company or licensee as often, at least 1 time every 5 years

insurer or insurance producer may pay or assign:

commissions, service fees, brokerages, or other valuable consideration to an insurance agency or to persons who do not sell, solicit, or negotiate insurance in this state, unless the payment would not violate the law

to be eligible for federal flood insurance:

community must participate in NFIP

Comparative Negligence

compare the fault of one party to another

persons cannot accept:

compensation, service fee, brokerage, or other valuable consideration for selling, soliciting, or negotiating insurance in this state is NOT LICENSED

performance bond:

complete the contract as agreed upon

CT workers comp.:

compulsory or mandatory for all employers no matter the size or how many employees companies hold - agriculture included - domestic employees (maids, chauffeurs etc.) come under law if they are employed by MORE THAN 26 HOURS PER WEEK by one employer - provisions of law apply to volunteer POLICE OFFICERS, and ELECTED MEMBERS OF LOCAL GOV. - self employed can choose to be covered by law - officers or corps. are auto covered unless they choose not to be

Exposure

conditions or situations that contribute to a potential loss ex: florida beach home is more exposed to hurricanes then home in the midwest

under fair credit reporting act: if a policy is declined or modified because of information contained in consumer or investigative report:

consumer must be advised with the name and address of the reporting agency - consumer has right to know what is in report - consumer also has a right to know the identity of anyone who has received a copy of the report during the past year - if consumer challenges report, reporting agency must investigate - if consumer is right in challenging a report, new copies must be sent out to anyone who requested this information within the past 2 years

Conditional Contract (7 Contract Characteristics)

contains conditions ex. receiving a premium to be insured

umbrella insurer will not:

contribute to any expenses incurred by underlying insurer

twisting

convincing customer to cancel already existing insurance and buy another one that is not to their benefit

injunction

court issued order to stop committing an act or violation

release of attachment bond:

court order requires attachment of assets, of another party (defendant) - defendant used this type of bond to have property returned by posting release of attachment bond to serve in lieu of property as security for plaintiff's claims

attachment bond:

court order requires that attachment of assets of another party, bond may be used to guarantee action to each property was wrong, damages suffered will be paid for

coverage C in HO is separated into 4 forms:

covered property: coverage is expanded to anywhere in the world. DP is primarily used for personal property on described location, not worldwide such as HO. limit for property at other residences: similar to worldwide property coverage offered in DP, but sublimit only applies in HO with other owned residences. special limits of liability: types of property and sublimit amounts are similar to broad theft endorsement for DP forms; however, HO forms, it is important to pay particular attention to categories that are only limited by peril of theft property not covered: limitations are added to HO policy of roomers, boarders, and tenants

HO5 comprehensive form:

covers both the dwelling and other structures on an open peril basis - covers personal property on an open peril basis with exception of landlord furnishings in an apartment that is rented (or held for rental to others) - landlord furnishing is limited to $2,500 limit and provided on an open peril basis - covers theft: misplacing or losing insured property, and could be 'mysterious disappearance'

Property Insurance

covers financial loss arising from owned property that is damaged destroyed or stolen example: coverage A dwelling

Transportation Expenses - what is it? wait period for theft and other losses? limits?

covers transportation due to physical damage to covered or non-owned auto -48 hour waiting period for theft of auto -24 hour waiting period for other losses -pays 20$ per day / 600 max (subtract the days that we do not cover then multiply remaining days * 20)

money:

currency, coin, bank notes in current use and having face value, travelers' checks, register checks, money orders held for sale to public

additional coverages: debris

debris removal: reasonable expenses for removal of debris of covered property for covered cause of loss - this is not an additional amount of insurance, but HO will allow for additional amounts of debris removal expense if amount to be paid for for the actual damage to property, plus debris removal expense is more than the limit of liability (additional 5% of applicable limit) - debris removal expense could apply to coverage A/B/C - HO policy will also pay an insured's reasonable expense for removal of trees from residence premises: = insured's trees fell by peril of windstorm, hail, weight of snow sleet rain = a neighbors tree fell by coverage C broad form peril: - damages a covered structure - blocks a driveway - blocks a ramp or other fixture to assist handicapped person to enter or leave the dwelling - total amount of coverage included for tree removal is $1,000 on an HO with a sublimit of $500 for the removal of any single tree

Certificate of Insurance

document certifying that insurance coverage is in place

excess (follow form):

does not expand or restrict coverage in relation to underlying insurance - coverage mirrors that underlying policy but increases the limit of liability based on amounts selected by insured

insurance information and privacy protection act:

during the course of acquiring information, insurers must follow certain procedures to protect privacy of clients - guarantees clients privacy - must inform applicants what information they are seeking out from any other entity - no special notice is required is required if insurer's underwriting will be based solely on information gathered from public records - requesting information from an attending physician would require notification - notice is required only once within 2 year period - anyone who obtains information concerning an individual from an insurance institution or agent under false pretenses may be fined $20,000

indirect loss

economic loss that is consequence of a direct loss ex. loss wages as a result from damage to vehicle

interim stage of flood emergencies:

emergency programs from NFIP offers reduced benefits until full requirements are met

exclusive remedy:

employee or anyone related to or representing employee may not enter lawsuit because of accident of disease - employee does not have choice to sue, or collect workers comp. benefits - if injury is covered by workers comp. then that is the only option for receiving funds

elective laws:

employer does not have to be subject to state's workers comp. laws - if employer chooses not to, loses common law defenses against personal liability suits

Extended Non-Owned

endorsement overrides the exclusion on regular use of a non-owned auto ex. company car extended coverage

purpose of licensing:

ensure that a producer meets educational and ethical standards required to fulfill producer's responsibilities to the insurer and public

Most exclusions to PAP Part D pertain to:

equipment

rehabilitation of injured worker:

essential objective - payment for physical therapy and occupational rehabilitation - teaching insured how to do job differently - teaching insured new skills to be used in new career

a producer cannot transact insurance:

except with regard to his own property or person, with or by any insurance company that does not hold a valid certificate of authority. - violation: $2,000, jail for 6 months, or both

umbrella policy

excess policy limits above that of an underlying policy - underlying policies are used first (liability coverage not property) - then umbrella policy covers any overages - pay damages in excess of primary or underlying insurance for bodily injury or property damage

Theft of Money and Securities - inside

exclusions: - accounting errors/omissions - surrendering of property for exchange or purchase - fire - loss of money from money machine unless machine has deposit recording device - loss or damage to motor vehicles, trailers, semi trailers, equipment attached - inducement or voluntary parting with any property - loss of property after it has been transferred to another person or place - vandalism or malicious mischief - voluntary parting of title to possession or property robbery or safe burglary = $5,000 per occurrence = metals (precious), precious and semi stones, pearls, furs, manuscripts, drawings, records

monopolistic

exclusive possession or control over supply of or trade in commodity or service

producers who obtain license within last 12 months of a biennium:

exempt from meeting continuing education requirements for biennium

Supplementary Payments

extra coverage in the policy at no cost Property Example: Fire dept service charge $500 Reasonable Repairs Debri removal Liability Example: Claims expense (defense costs, reimbursement of expenses when you go to court) First aid to others

broad perils

falling objects weight of ice and snow overflow of water or steam from systems or appliances rupture of systems freezing of systems artificially generated electrical current

FELA:

federal employer's liability act - employer's liability law rather than workers comp. law - predates workers comp. and makes interstate railroad for BI available for employees - under section 2 of workers comp. and employer's liability policy unless specified excluded

FIA

federal insurance administration

FIMA

federal insurance and mitigation administration

individual found in violation of regulation:

fine $250-$2,500 jail 30-90 days, or both

cancelation and non-renewal notice requirements

first 60 days cant cancel -10 days notice Don't want to renew -30 days -no ageism

FIA sets:

flood insurance rates - to qualify = community must cooperate with FIA

coercion

forceful act or threat aimed to influence a person to act against his or her will - require as a condition to a loan, that the applicant purchase insurance from a specific insurer

an incorporated society without capital stock that uses the lodge system. offer insurance only to their members

fraternal benefit societies ex. knights of Columbus

counterfeit

fraudulent imitation, forgery

outside of premise commercial stealing:

from theft, disappearance, destruction of money, securities, other property outside of premises in care custody of messenger - $5,000 per occurrence

underwriting

function of an insurance company that evaluates policyholders to determine insurance eligibility and pricing

exclusions in HO:

general property exclusions: - ordinance or law - earth movement - water damage - power failure - neglect - war - nuclear hazard - intentional loss - government action

Contributory negligence

girl texting walks in front of a car

labor and materials bond:

guarantee that work and materials will be delivered free and clear of any liens, or other burdens - payment bonds

cost bond:

guarantees plaintiff who brings legal action against another defendant will be able to pay court costs and any resulting damages in the event the plaintiff loses case

commissioner

head of state department of insurance

concealment

hiding a fact that is relevant

homeowners and dwelling is similar however:

homeowners includes coverage for personal property of insured, and personal liability protection

medical benefits:

hospital bills, doctor bills, prescriptions, dental work are paid in full

appeal bond:

if a person appeals to a higher court after a judgement, bond may be required to guarantee judgement will be paid as well as cost as appeal

boycott, coercion, intimidation:

illegal to be involved in any activity of boycott, coercion, or intimidation that is intended to restrict fair trade or create a monopoly - includes unfair behavior that influences not only clients, but competing agents and brokers

Misrepresentation

illegal to issue, publish, circulate any illustrations or sales material that is false, misleading, or deceptive to policy benefits or terms, payment of dividends - oral statements are included

property included/excluded in coverage C:

included: - personal property owned or used by the insured while it is anywhere in the world - at discretion of named insured, property of others, property of guests or residence employees may also have their belongings covered while in any residence an insured is occupying - property of roomers and boarders related to an insured - hobby aircraft and parts not used or designed to carry people - motor vehicles and other conveyances but while only to service the premise or designed to assist handicapped - blank storage media and prepacked computer software not included: - any items separately described and insured regardless of the limit of insurance - animals, birds, fish - aircraft and parts whether attached or not, other than used for hobby noted above - hovercraft and parts - motor vehicles and other motorized land conveyances, other than notes above - includes electronic apparatus powered solely by vehicle + parts and accessories to vehicle and electronic equipment but only while in or upon vehicle - business data contained in books of accounts, paper records or in computer equipment - property of roomers, boarders, and tenants not related to insured - property in apartment regularly rented or held for rent - credit cards, debit cards or any device used to deposit, withdraw or transfer funds - water or steam

Commercial Property Broas Loss (form)

includes basic coverages plus: Falling Objects Weight of Ice, Snow or Sleet Water damage caused by accidental discharge

implied authority

independent agent who sells xyz policies ex. regularly collects premiums even if not in contract

negative information:

information regarding a customer's delinquencies, late payments, insolvency, any other form of suit

permanent partial disability (PPD):

injury or disability is permanent, but insured can work in a new method (ex. losing arm)

surety of surety:

insurance company or surety company that guarantees the obligation will be performed - if principal fails to perform that act as promised, surety is contractually liable for losses sustained

Casualty Insurance

insurance that covers property and liability losses (excluding life and health insurance)

homeowners policy is a comprehensive insurance form used to:

insure residential risk

affidavits in surplus:

insured and surplus lines broker sign affidavit stating diligent effort was made to obtain insurance from authorized and that coverage was not obtained and could not be from them - amount of surplus insurance is only excess over amount procured from authorized insurers - must file to commissioner within 45 days

in other states, workers comp. is purchased by employers from those:

insured authorized to write casualty insurance - coverage and benefits are mandated by state regulations = COMPETITIVE MARKET

permanent total disability (PTD):

insured cannot work now and never will again (ex. loss of both arms)

false financial statements:

intended to deceive public officials or general public about financial condition of insurer - important financial info is withheld in order to present company in better light

material misrepresentation

intentional act of concealing or altering an important fact that would have altered the basis of a decision by the other party

Estoppel

is a legal doctrine preventing a party from contradicting its own previous actions that were relied on by another party.

individual who unknowingly violates fair credit reporting act:

is liable in the amount equal to the loss to the consumer - as well as any reasonable attorney fees incurred - $2,000

bail bond:

issued to secure release of person from jail pending courtroom appearance - guarantees person will appear when specified

Personal Contract (7 Contract Characteristics)

it insures Persons

anyone engaged in business whose activities affect interstate commerce and who knowingly makes false material statements may be fined:

jail 10 years with fine, or both - if activity jeopardized the security of accompanies insurer, punishment can be 15 years

Misrepresentation

leaves out information on purpose to mislead

judicial bonds:

legal or fiduciary obligations

who signs the applications?

licensed officer = corporation licensed partner = partnership licensed principal = any other applicant

coverage for business entities is very limited in property section of the homeowners policy:

limitations impact personal property and other structures coverage - liability associated with a business is excluded from the policy - endorsements can be added

Insurable Interest (7 Contract Characteristics)

loss or damage would cause you to suffer a financial loss

other insurance law states:

losses will be paid on a contribution by equal shares basis - limit of liability explains that limits on information page for BI by accident apply per accident, and BI by disease applies per person subject to BI disease policy limits for all losses during policy term - subrogation rights and actions by insurer

Workers Comp Limits of Liability

minimum limits: $100,000 per accident for injuries $100,000 per employee for disease $500,000 aggregate for disease

funds:

money and securities

remuneration

money paid for work or service

Personal Property

movable

Joint Ownership

multiple owners when 2 or more relatives who may not reside together or unrelated individuals residing together

owned entirely by its policyholders. profits are rebated to policyholders through dividends or reduction in future premium

mutual insurance

NFIP:

national flood insurance program

securities:

negotiable and non-negotiable instruments or contracts representing money or other property such as tokens, tickets, revenue, other stamps, evidence of debt issues in connection to credit or charge cards not issued by insured

What is the standard deductible under Section II of a homeowners policy?

no deductible

temporary total disability (TTD):

no work, but will return to full capacity

Non Renewal

not continue policy after the end of existing policy term (by insured or insurer)

Real Property

not movable

Trees shrubs and plants

not replaced from windstorm 5% of coverage A limited to a 500$ max per tree/plant/shrub

exempt

not subject to an obligation

applicants from other states would first:

obtain license in their home state, then apply for a nonresident license in CT

inducement

offer that attempts to influence the other party

consultant

offers advise on insurance policies

permissible incidental occupancies:

offices, schools, studios

Unilateral (7 Contract Characteristics)

one-sided contract. insurance company makes promise to cover you if loss

defamation of insurer:

oral/written statement is made that is intended to injure persons engaged in insurance business - maliciously critical statements of any financial condition or company

insurance producers cannot have right to compensation:

other than commissions deductible from premiums on insurance policies, from any insured or prospective insured unless compensation is based upon written memorandum signed by party to be charged - specifying amount or extent of such compensation, provided compensation is in compliance with regulations adopted by law

Types of Auto:

owned = vehicle titled to insured or acquired during policy period non-owned = private vehicles operated by or in customer of named insured, not titled to insured hired = lease, rented, borrowed temporary substitute: auto or trailer not owned by insured use while the insured vehicle is out of service due to breakdown, repair, loss, destruction

DP Limited Theft

owner would like coverage for his personal prop in a dwelling he rents to others - only on premises

DP Broad Theft

owner-occupied dwellings - on and off premises coverage

renewal or other deferred commissions:

paid to person (or heir, or assignee) for selling, soliciting, or negotiating insurance if that person was licensed at that time

disability income:

paid to workers when injury or disease prevents from performing all or part of job

principal of surety:

party that purchased the bond and undertakes an obligation to perform an act as promised

Obligee (on a surety bond)

party who requires and receives benefit of surety bond - Obligee is a local, state, or federal government organization

insurance companies and producers cannot:

pay a commission, service fee, brokerage fee, or other valuable consideration to a person for selling, soliciting, or negotiating insurance in this state if the person is NOT LICENSED

application fees for an insurance producer must pay to, and cost:

pay to commissioner, and $50. $15 nonrefundable fee for administering examinations.

commission

payment to agent by the insurance company for placing insurance, usually a percentage of the policy premium

remuneration:

payroll and other methods of compensation - another component in determining premiums - insured is required to keep records on all remuneration so final premium can be determined - rate per job classification is charge per each $100 of annual payroll - initial premium is a deposit and is subject to adjustment at end of term (premium audit - conducted during regular business hours during policy period and up to 3 years after policy expires)

third party

person or group other than insurer and insured that is involved in an insurance contract

Obligee or insured:

person to whom promise has been made to and whom bond is payable in the event the principal defaults on the obligation - party who requires bond in return for entering into an agreement with the principal - ex. entity that enters into contract with a construction firm to build an office building may require contractor to be bonded to the amount of the project to ensure it is completed - owner of building = Obligee or insured

boarder

person who lives with someone else for an agreed upon price, usually for a considerable amount of time

principal or obligee:

person who promises to fulfill obligation and who purchases the bond - this person or entity will go thru an underwriting process - underwriting for surety bonds = takes into account financial stability and credibility - simple as an application, or complete review of financial statements

If you are renovating or repairing your home making it unfit to live in and need to move personal property to a temporary residence, the property is covered for _______ (amount).

personal property has full coverage while it is at the temporary residence.

Outboard Motor and Boat insurance

physical damage open perils motor boats accessories and trailers

Pro-rata formula

policy amount / insurance available total = % to be paid * Loss amount

Assignment condition

policyholders cannot transfer or assign their policy to someone else

Conditions (5 Parts of Insurance Policy)

portion of the policy that details the RESPONSIBILITIES of the insured and the company

underlying policy:

primary coverage - insured must maintain underlying coverage AT FULL LIMITS STATED IN DEC. with no change to more restrictive conditions DURING TERM of policy - if underlying insurance is CANCELED, or NOT RENEWED or NOT REPLACED, insured must NOTIFY insurer IMMEDIATLY - if insurer fails to maintain underlying insurance, insurer is NOT liable for policy for more than it would have been liable for if underlying were intact

a commissioner may place:

probation, suspend, revoke or refuse to issue or renew an insurance producer's license - may levy a civil penalty - may take any combination of such actions for any of the reasons below: - incorrect, misleading, incomplete, materially untrue information in application for license - violating any insurance law/violating regulation/subpoena or order of the commissioner - obtaining or attempting to obtain a license thru misrepresentation or fraud - improperly withholding, misappropriating or converting any monies or property received in the course of business of insurance - intentionally misrepresenting the terms of an actual or proposed insurance contract or application for insurance - convicted of felony - admitted/found to have committed any insurance unfair trade practice or fraud - using fraudulent or dishonest practices, demonstrating incompetence, untrustworthiness, financial irresponsibility in the conduct of the business of insurance - having an insurance producer license suspended or revoked in any state - forging another's name to an application for insurance, or to any document related to an insurance transaction - improperly using notes or any other reference material to complete an insurance exam - knowingly accept insurance business from an individual who is not licensed - failing to comply with an admin. or court imposing child support obligation - failing to pay state income tax or comply with any administrative or court order directing payment of state income tax

producer may not attempt to renew a license unless:

producer has completed CE requirements

if producer fails to complete CE by last day of eligibility:

producers license will not be renewed

minimum capital and surplus requirements:

property casualty fidelity surety marine workers comp. etc.

Personal Yacht policies

property and liability coverage. navigational limits

Boatowners/watercraft package policies

property liability and medical coverage on open peril. ACV

other property in commercial:

property other than money or securities

errors and omissions:

protects insurance agents and brokers from financial losses they may suffer if an insured sues to recover his/her financial losses due to agent giving incorrect advice, not using correct coverage, not informing insured on important issues - claims-made basis

Liability insurance

protects you from being held legally liable for something due to injury, harm or negligence

HO2 broad form:

provides protection for losses from named perils - not covered: = inside of a building by rain, snow, sleet, sand, dust unless wind or hail damage first creates opening = inside of a building for loss by a falling object unless the falling object first damages the roof or an outside wall = fences, driveways, walks for damage from a vehicle owned or operated by a resident = damage from water or steam if dwelling is vacant for more than 60 days

defamation:

publishing/stating and circulating false, maliciously critical, derogatory statements regarding other insurer's financial condition

commissioner may, by regulation, establish what?

reasonable schedule of maximum fees which may be charged by producers

unincorporated association of subscribing members. all members insure each other and share the losses

reciprocal exchange ex. AAA USAA

unfair discrimination

refusal of insuring, limiting amounts, extents, charging a different rate, or type of coverage due to the following; - physical disability - mental retardation - blindness or partial blindness - exposure to diethylstilbestrol through a female parent

producer lapse in licensure:

reinstate within 12 months = no written exam - payments after due date (penalty in amount of double unpaid renewal fee)

broker

represents the insured. contacts different insurance companies to find the best one for client

Liability, Medical Payments, Uninsured Motorist -Not replacing car listed on policy

request coverage within 14 days

injuction bond:

required by courts whenever someone seeks an injunction against another - guarantees that if injunction should not have been issued, damages will be paid to the injured party

compulsory

required by law, mandatory - unless specifically excluded due to STAFF SIZE, EMPLOYMENT TYPE

Bill of Lading

required to be issued to the shipper of the goods being transported. 2 types. 1. Straight (regular) - carrier is responsible for the invoice cost of the goods 2. Released - carrier is only responsible for the value of the goods declared on the bill of lading

failure to maintain complaint records:

required to maintain complete record of all complains since the date of last examination - record number of complaints - record classification line of insurance - nature of each complaint - disposition of complaint - amount of time that it took to process each complaint

licensing regulations:

requirements, procedures, fees, relating to qualification, licensure, and appointment of insurance producers

DP-2 Broad

reservations about the risk. insures more perils, addtl coverages and the replacement cost on dwellings and ACV of personal property Perils - WC SHAVVER FTV + Additional Named Perils: vandalism, damage by burglars (not theft), falling objects, weight of ice, overflow of water or steam, freezing, electrical current, sudden tearing or cracking burning of system

applicants who live and work in CT would apply for:

residence licenses

Provides insurance to those who wouldn't otherwise qualify

residual markets ex: flood insurance

reabilitation

restore person to condition of good health, ability to work

subrogation

right for an insurer to legally pursue a third party for recovery of amount paid to the insured

pure risk

risk with no chance of gain or beneficial result Insurance covers pure risk

speculative risk

risk with potential for both loss and gain

named peril

risks or cause of loss specifically listed in a policy

law of large numbers

says the larger the data set, the more reliable the statistic. Determines expected losses and the premium needed in order to cover those losses

The company assumes the risk of loss. The risk of loss is deemed to be lower than the cost of buying insurance

self-insurance

SIR

self-insured retention - deductible that must be paid by insured in order to access the umbrella policy's funds when insured's underlying coverage will not cover the loss

solicitor

sells insurance. cant issue or countersign policies. works with or for agent

NFIP flood insurance does not cover:

sewer backup or seepage through walls

Producer

someone who sells insurance such as an agent, broker, or solicitor

incidental

something occurring as a minor accompaniment to something else

Exclusions (5 Parts of Insurance Policy)

something that is not covered

hazard

source of danger that increases the likelihood of loss

home state

state in which an insurer is organized and has its main place of business

Representation (7 Contract Characteristics)

statements on an insurance application that the insured believes to be true ex. answering questions honestly to the best of your knowledge

producers license is in force unless:

suspension, cancellation, revoked, as long as producer pays fees and maintains all CE

Binder

temporary insurance for specific period of time

flood is defined as:

temporary inundation of normally dry land

HO4 contents broad form:

tenant broad form - insures personal property for broad perils - coverage may not be issued to an owner-occupant - HO4 may be written for a tenant who resides in a rented dwelling, apartment, or mobile home - not provide coverage on the dwelling itself as tenant is only responsible for his/her own apartment

open peril

term used that describes that coverage provided is 'all risk' or 'any risk of loss' that is not specified directly

tx residual markets

texas automobile insurance plan assoc - rejected by 2 insurance companies texas fair plan assoc- cant get in reg mkt or haven't had insurance for past 6 mo texas windstorm insurance assoc - rejected by 1 insurance companies Huricane Celia aug 70

producers of credit, travel-accident, and travel-baggage insurance are also exempt:

the 24 hour CE requirement

flood insurance is sold by:

the government and by participating private insurers - claims are paid by the federal government

Abandonment condition

the insured cannot abandon or dump damaged property on the insurance company and demand payment

Subrogation

the insured transfers his rights to his insurance company to collect from an at-fault party on his behalf

Arbitration

the process for using an arbitrator to resolve the difference ex. settling liability claims and disputes between two insurance companies

if a producer makes any contract of insurance on behalf of an insurance company that is not licensed to do business in CT:

the producer will be PERSONALLY LIABLE to the insured for benefits and other aspects of the contract, including payment of claims

consumer reports cannot contain certain types of information if:

the report is requested in connection with a life insurance policy or credit transaction of less than $150,000

apparent authority

third party that helped in the past

Indemnity (7 Contract Characteristics)

to make whole again. leave customer no better no worse.

cease and desist

to stop or discontinue

insurance professionals must be properly licensed in a specific line of authority in order to:

transact insurance

medical/surgical aid to hospital and nursing service:

treatment by spiritual means - may extend to prayer or use to principles of any church without use of any drug

if underlying coverage is not in effect:

umbrella insurer will provide defense at insurer's expense by counsel or insurer's choice

Proximate Cause

unbroken chain of events that causes loss. the NEAREST cause

person who knowingly and willfully obtains information on a consumer from a consumer reporting agency:

under false pretenses, may be fined and/or imprisoned for up to 2 years

Aleatory (7 Contract Characteristics)

unequal transfer of value ex. if you purchase insurance and next day get in crash, you're covered even though you have only paid one premium

reciprocal:

unincorporated group of individuals or businesses with similar liability exposures - not available to public - only members of group can purchase coverage and must have similar liability exposures to be a member of the group - group has authority to establish mandatory safety rules for workplace

license and permit bonds:

usually required by state and local government guarantee that the laws and regulations of a particular professional are followed - a license and permit bond guarantees that the recipient of a permit will comply with the laws, regulations, and ordinances associated with use of the permit

DP-1 Basic

very basic. ACV perils are . No Coverage E unless endorsed. Perils - Fire and Lightning and Internal Explosion

Section 1034 - civil penalties:

violations of section 1033, attorney general may bring civil action in US district court against any person when violating 1033 of not more than $50,000 for each violation - or amount of compensation the person received as a result of the prohibited conduct, whichever is greater

Payment of PIP Benefits TX

w/on 30 days or 12% + interest

flood insurance loss will not cover:

wharves, piers, docks

certificate of authority:

what is applied to the commissioner, what is approved in order to conduct legal insurance - contains: character, articles of association, evidence that you are in good standing w law, financial condition`

bid bonds:

when construction projects are awarded based on lowest bid - Obligee usually also requires this bond - promises that if contractor is awarded the contract, the contractor will actually accept contract and a performance bond will be issued

HO-2

when risk is ineligible for ho-3. broad coverage for A B C

unfair claim settlement practice:

when someone consistently commits: - advertising that misrepresents benefits, advantages, conditions, terms, dividends, financial conditions, premium - defamation - committing boycott, coercion, intimidation resulting in unreasonable restraint or monopoly - publishing, disseminating, or circulating false financial statements intent to deceive - misrepresenting facts or policies - failing to address claims in time - failing to implement what should be used - refusing to pay claims without conducting investigation - failing to affirm or deny coverage claims within reasonable time after proof of loss - not using good faith - not prompt, fair, equitable settlement of claims - compelling insured's to institute litigation to recover amounts due by offering less - settle claim for less than - settle claims where application was altered, with no notice to insured - claims payments to insured's or beneficiaries without stating policies - delay investigation of payment of claims due to wanting preliminary claims reports - not settling claims - not providing explanations - using (cash basis) with a first party automobile, where amount is lesser than what insurer would normally pay

other insurance condition

when there is more than one policy insuring a person the policy will state when the policy will respond as primary excess or on a pro-rata basis

Basic Perils (WC SHAVVER FTV)

windstorm civil commotion smoke hail aircraft vehicles volcanoes explosion riot fire and lightning vandalism

insurer may settle any claim:

without consent of insured

forgery and alteration in commercial:

worldwide coverage for loss of money from forgery and alteration of outgoing checks, drafts, promissory notes - defense coverage = provided if insured is being sued for action of not honoring financial instrument or forgery - proof of loss - territory - electronic signatures

private insurance companies cannot:

write workers comp. insurance in competition with state funds

HO2 HO3 HO5

written only for owner-occupant of a dwelling - used exclusively for private residential purposes and not as a vacation home - (incidental office or professional occupancy) such as beauty shop or private school as long as there are no retail sales or more than 2 people working at any one time - not contain more than 2 roomers or boarders - replacement cost basis if building is insured for 80% or more of its replacement cost

personal changes:

written to commissioner: - name change - employer change - business address change - residence address change

Dwelling & HO personal liability endorsement

• Is similar to the liability section of the HO policy • Provides $100,000 personal liability (Coverage L) • Provides $1,000 medical payments to others (Coverage M); and • Provides Property Damage to others of $500

Other Than Collision aka Comprehensive Perils

• Missiles or Falling Objects • Fire • Theft or larceny • Explosion or earthquake • Windstorm • Hail, water, flood, Mischief or vandalism • Riot or civil commotion • Contact with animal • Breakage of glass