C12 - Insurance on Property – Midterm
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questions with answers |\ |\
Defining Property Insurance - CORRECT ANSWERS ✔✔-Protection
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against loss/damage to property
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-First party insurance
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-Premium exchanged for protection |\ |\ |\
-Fortuitous losses (sudden and accidental) |\ |\ |\ |\
-Insurable interest |\
-Intangible product |\
Real vs Personal Property - CORRECT ANSWERS ✔✔R: buildings or
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land (can't be moved)
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P: office desk or machinery (can be transported)
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Promise that Property Insurance is based on - CORRECT
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ANSWERS ✔✔-Insured promise to pay a premium |\ |\ |\ |\ |\ |\
-Insurers promise to protect and indemnify
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Five elements of an Insurance Contract - CORRECT ANSWERS
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✔✔1. Agreement (offer and acceptance)
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2. Capacity to contract
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3. Consideration
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,4. Genuine intent
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5. Legality
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Additional Features of Insurance Contract - CORRECT ANSWERS
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✔✔1. Insurable interest
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2. Indemnity
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3. Principle of utmost good faith
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Insurance Policy - CORRECT ANSWERS ✔✔-Formal agreement
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between parties |\
-Outlines the terms and conditions
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-One year term
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-Claims
2 Types of Classes of Insurance - CORRECT ANSWERS ✔✔1.
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Personal (habitational)|\
2. Commercial (building, equipment, stock)
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Classes of Insurance - CORRECT ANSWERS ✔✔1. EBI - large
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machinery
2. Crop - growing of crops
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3. Aviation - aircrafts
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4. Earthquake
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5. Flood
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,6. Marine - goods in transit
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7. Builders risk - COC
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Elements of the Property Policy - CORRECT ANSWERS ✔✔1. Name
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of insurer / insured
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2. Names to whom the insurance money is payable
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3. Premium|\ |\
4. Subject matter of insurance
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5. Indemnity for which insurer may become liable
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6. Events / perils of which liability will accrue
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7. Effective / expiry date
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Deductible definition - CORRECT ANSWERS ✔✔An agreed, |\ |\ |\ |\ |\ |\ |\
specified amount that the insured must pay on a claim before the
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insurance company will cover the rest of the claim
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Evolution of Property Insurance - CORRECT ANSWERS ✔✔-First
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insurance policy = fire policy. |\ |\ |\ |\
It covered fire, lightning and limited explosion
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-Then it evolved into additional perils. So insurance against
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named perils or all risks |\ |\ |\ |\
Purpose of Exclusions - CORRECT ANSWERS ✔✔-Specific
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circumstances
-Temporary or permanent |\ |\
-May exclude part of the coverage
|\ |\ |\ |\ |\
, -Restricts
The 2 Groups of Basic Fire Policy Exclusions - CORRECT ANSWERS
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✔✔1. Exclusions of legislative considerations
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2. Exclusions for underwriting and rating considerations
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Group 1: Exclusions for Legislative Considerations - CORRECT
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ANSWERS ✔✔1. Electrical devices |\ |\ |\
2. Application of heat
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3. War risks
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4. Nuclear incident (exclusions also applies to radioactive
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material)
Group 2: Exclusions for Underwriting and Rating Considerations -
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CORRECT ANSWERS ✔✔1. Excluded property
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2. Alterations and additions exclusion
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3. Vacancy, unoccupancy, or disuse exclusion
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4. Volatile substances
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5. By-laws exclusion
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The Basic Fire Policy: Statutory Conditions - CORRECT ANSWERS
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✔✔Legislation stipulates: |\
-Conditions must be printed |\ |\ |\
-Avoid any changes |\ |\
-Only applies to fire insurance
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|\ |\ |\ |\ |\ |\ |\
questions with answers |\ |\
Defining Property Insurance - CORRECT ANSWERS ✔✔-Protection
|\ |\ |\ |\ |\ |\ |\
against loss/damage to property
|\ |\ |\
-First party insurance
|\ |\
-Premium exchanged for protection |\ |\ |\
-Fortuitous losses (sudden and accidental) |\ |\ |\ |\
-Insurable interest |\
-Intangible product |\
Real vs Personal Property - CORRECT ANSWERS ✔✔R: buildings or
|\ |\ |\ |\ |\ |\ |\ |\ |\
land (can't be moved)
|\ |\ |\ |\
P: office desk or machinery (can be transported)
|\ |\ |\ |\ |\ |\ |\
Promise that Property Insurance is based on - CORRECT
|\ |\ |\ |\ |\ |\ |\ |\ |\
ANSWERS ✔✔-Insured promise to pay a premium |\ |\ |\ |\ |\ |\
-Insurers promise to protect and indemnify
|\ |\ |\ |\ |\
Five elements of an Insurance Contract - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\ |\
✔✔1. Agreement (offer and acceptance)
|\ |\ |\ |\
2. Capacity to contract
|\ |\ |\
3. Consideration
|\
,4. Genuine intent
|\ |\
5. Legality
|\
Additional Features of Insurance Contract - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\
✔✔1. Insurable interest
|\ |\
2. Indemnity
|\
3. Principle of utmost good faith
|\ |\ |\ |\ |\
Insurance Policy - CORRECT ANSWERS ✔✔-Formal agreement
|\ |\ |\ |\ |\ |\ |\
between parties |\
-Outlines the terms and conditions
|\ |\ |\ |\
-One year term
|\ |\
-Claims
2 Types of Classes of Insurance - CORRECT ANSWERS ✔✔1.
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
Personal (habitational)|\
2. Commercial (building, equipment, stock)
|\ |\ |\ |\
Classes of Insurance - CORRECT ANSWERS ✔✔1. EBI - large
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
machinery
2. Crop - growing of crops
|\ |\ |\ |\ |\
3. Aviation - aircrafts
|\ |\ |\
4. Earthquake
|\
5. Flood
|\
,6. Marine - goods in transit
|\ |\ |\ |\ |\
7. Builders risk - COC
|\ |\ |\ |\
Elements of the Property Policy - CORRECT ANSWERS ✔✔1. Name
|\ |\ |\ |\ |\ |\ |\ |\ |\
of insurer / insured
|\ |\ |\ |\
2. Names to whom the insurance money is payable
|\ |\ |\ |\ |\ |\ |\ |\
3. Premium|\ |\
4. Subject matter of insurance
|\ |\ |\ |\
5. Indemnity for which insurer may become liable
|\ |\ |\ |\ |\ |\ |\
6. Events / perils of which liability will accrue
|\ |\ |\ |\ |\ |\ |\ |\
7. Effective / expiry date
|\ |\ |\ |\
Deductible definition - CORRECT ANSWERS ✔✔An agreed, |\ |\ |\ |\ |\ |\ |\
specified amount that the insured must pay on a claim before the
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
insurance company will cover the rest of the claim
|\ |\ |\ |\ |\ |\ |\ |\ |\
Evolution of Property Insurance - CORRECT ANSWERS ✔✔-First
|\ |\ |\ |\ |\ |\ |\ |\
insurance policy = fire policy. |\ |\ |\ |\
It covered fire, lightning and limited explosion
|\ |\ |\ |\ |\ |\
-Then it evolved into additional perils. So insurance against
|\ |\ |\ |\ |\ |\ |\ |\ |\
named perils or all risks |\ |\ |\ |\
Purpose of Exclusions - CORRECT ANSWERS ✔✔-Specific
|\ |\ |\ |\ |\ |\ |\
circumstances
-Temporary or permanent |\ |\
-May exclude part of the coverage
|\ |\ |\ |\ |\
, -Restricts
The 2 Groups of Basic Fire Policy Exclusions - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
✔✔1. Exclusions of legislative considerations
|\ |\ |\ |\ |\
2. Exclusions for underwriting and rating considerations
|\ |\ |\ |\ |\ |\
Group 1: Exclusions for Legislative Considerations - CORRECT
|\ |\ |\ |\ |\ |\ |\ |\
ANSWERS ✔✔1. Electrical devices |\ |\ |\
2. Application of heat
|\ |\ |\
3. War risks
|\ |\
4. Nuclear incident (exclusions also applies to radioactive
|\ |\ |\ |\ |\ |\ |\ |\
material)
Group 2: Exclusions for Underwriting and Rating Considerations -
|\ |\ |\ |\ |\ |\ |\ |\ |\
CORRECT ANSWERS ✔✔1. Excluded property
|\ |\ |\ |\
2. Alterations and additions exclusion
|\ |\ |\ |\
3. Vacancy, unoccupancy, or disuse exclusion
|\ |\ |\ |\ |\
4. Volatile substances
|\ |\
5. By-laws exclusion
|\ |\
The Basic Fire Policy: Statutory Conditions - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\ |\
✔✔Legislation stipulates: |\
-Conditions must be printed |\ |\ |\
-Avoid any changes |\ |\
-Only applies to fire insurance
|\ |\ |\ |\