Property and Casualty 2024 Questions with correct Answers Final Exam

Property and Casualty 2024 Questions with correct Answers Final Exam The 3 Elements of Insurance Interests 1. Financial 2. Blood (family) 3. Business Risk Uncertainty regarding financial loss The 2 Types of Risks 1. Pure 2. Speculative Pure Risk Insurance because it involves a chance of loss only Speculative Risk Not insurable because it involves a change or gain Hazard Gives to a peril Peril Serious and immediate danger, threat The 3 Types of Hazards 1. Physical 2. Moral 3. Morale Physical Hazard Physical condition Moral Hazard A tendency toward increased risk Morale Hazard An indifference to loss Indemnity - Often referred to as reimbursement - Insured or beneficiary are permitted to collect extent of financial loss - Insured cannot gain financially from a loss Subrogation - Insurer's legal right to seek damages from third parties - Occurs after insurer reimburses insured - Prevents insured from collecting twice Combined Single A single dollar limit of liability applying to the total of damages for bodily injury and property damage combined, resulting from one accident or occurrence Damages Comprised of bodily injury or property damage General Damages Compensate for pain and suffering, mental anguish, or disfigurement The 4 Elements of Negligence 1. Legal duty 2. Standard of care 3. Unbroken chain of events 4. Actual loss or damage Types of Loss Valuation 1. Actual cash value (ACV) 2. Replacement cost 3. Market value 4. Agreed value 5. Stated value 6. Salvage value Salvage The amount of money realized from the sale of demanded merchandise or property Split Separately stated limits or liability for different covera