Texas All lines adjuster license insurance terms and concepts Chapter 1: Updated Guide Solution

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Law of Large Numbers (Ans- the more examples used to develop any statistic, the more reliable the statistic will be Underwriting (Ans- The process and insurance company uses to decide whether t... o except or reject an application for a policy insurance. underwriters evaluate the risk and exposure of a potential policyholders they decide how much coverage the policyholder should receive how much they should pay for it or whether even to except the risk and insure them. underwriting involves measuring risk exposure and determining the premium that needs to be charged to ensure that risk. peril (Ans- A cause of property losses I.E, fire, lightning, explosion, windstorm, hurricane, collapse of building, vandalism, accidental discharge, theft. Hazard (Ans- Is a situation that poses a level of threat to life, Heath, property, or environment. Direct loss (Ans- Direct physical loss to property Indirect loss (Ans- A loss that arises as a result of damage to property, other than the direct loss to the property. If you own a taxi and someone totals out your taxi, you can't make money because you can't drive your taxi for fares. Principle of indemnity (Ans- Insurance will not pay more than the cost of the incident Property insurance (Ans- Covers the loss of real and personal property from perils such as fire, theft, windstorm Insuring Agreement (Ans- Summarizes the major promises of the insurer in exchange for premium payments by their customer. Deductible (Ans- Amount you must pay before you begin receiving any benefits from your insurance company Cancellation (Ans- Termination of an insurance policy by insurance company or insurer before the renewal date. All notices must be done in writing. Limit of Liability (Ans- The maximum amount for which an insurer is liable. The policy of declarations specifies limits. Loss settlement (Ans- The process used to determine the amount of the loss. Methods used to settle losses (Ans- Actual cash value- value of the property, based on the current cost to replace it, minus applicable depreciation. Replacement cost- the cost associated with replacing property at current market prices. Agreed value- the amount that the insured and insurer agree upon during the time of policy inception. Market value- the amount the property is worth in a competitive market. This amount is accepted by the buyer and seller. Casualty insurance (Ans- Protects a person from financial loss arising from bodily injury or property damage to others arising out of : ownership of property, operation of a motor vehicle, personal activities, business activities, robbery, and Worker's comp. Liability (Ans- A person is legally liable for an accident if that person is found responsible for bodily injury or property damage to another party. Usually based upon the negligent acts of that person. negligence (n) (Ans- carelessness Tort (Ans- A civil wrong committed against someone else. This breach would determine if that person is negligent. The essential elements used to determine negligence : duty owed Duty breached Proximate cause Damages Punitive Damages (Ans- Money a court requires a defendant to pay in order to punish and make an example of the defendant. "Punitive" (punished or punishment by the court) Comparative Negligence (Ans- Is a partial legal defense that reduces the amount of damages that a person can recover based upon the amount that this person's own negligence contributed to the loss. (Two or more people Sharing fault in a negligent situation) Contributory Negligence (Ans- Is a law defense where a person's own negligence contributed to the harm that he or she sustained assumption of risk (Ans- Is a defense which bars a person that voluntarily and knowingly subjected oneself to danger. [Show More]

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