Personal Lines - Florida
About this set
Created by:
QBrep on March 28, 2012
Subjects:
insurance, Florida, personal lines
Description:
Q&B March 2012
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134 terms
Terms | Definitions |
|---|---|
 5 Qualifications for a General Lines License | 1. 18 years old 2. resident of FL or place of business in FL 3. 200-hour course or 1 yr experience in all lines 4. cannot be for writing controlled business 5. Exam waived for CPCU designation or college degree with 15 hours in insurance |
| controlled business | more than 50% of income from businesses applicant is involved in, such as family business |
| Department of Financial Services | does not make rating and underwriting rules |
| risk | chance of financial loss |
| insurance policy | written contract, including all clauses, riders, endorsements, and papers |
| insurance | a contract wherein one undertakes to indemnify another or pay a specified sum upon the happening of a determinable event |
| binder | temporary insurance - oral or written; Auto 5 days for cancellation, all others 60 days |
| property insurance | payment by insurer (company) is made to insured |
| liability insurance | payment by insurer (company) is made to others on insured's behalf |
| personal contract | contracts cover persons - not property or operations |
| conditional contract | obligations of insurer may depend upon insured satisfying some conditions |
| contract of adhesion | insureds can not negotiate the terms; one-sided contract |
| indemnity contract | one should not profit from teh proceeds of the policy but should be made whole |
| Exceptions to indemnity | 1. Valued policies 2. Florida Value Policy Law 3. Replacement cost 4. Liability insurance |
| Insurable interest | Must exist at the time of loss |
| peril | condition or occurrence that may cause a loss (fire, wind, theft, collision) |
| hazard | increases the likelihood of a loss |
| physical hazard | physical characteristic increases the likelihood of a loss - wet floor |
| moral hazard | intentional loss - taking drugs |
| morale hazard | carelessness - leaving cash drawer open in a business |
| doctrine of proximate cause | unbroken connection between an occurrence and damage which grows out of the occurrence |
| direct loss | physical harm to tangible property |
| indirect loss | economic loss as a consequence of a direct loss - ex) rental car fees |
| mortgage holder | has lender's interest in property |
| lender interest | named in loss payable clause and called loss payee - personal property; named mortgage/mortgagee clause and called mortgage holders - real property |
| real property | buildings and land |
| personal property | can be taken when you move away |
| loss settlement valuation | actual cash value = replacement - depreciation |
| replacement cost | actual cost to repair or replace property; awnings, flooring, appliances, TV antennaes are excluded |
| Florida Valued Policy Law | insurer must pay the amount provided in teh policy for which premium has been paid for a total loss by an insured peril |
| Co-insurance | artificial device that encourages the insured to pruchase insurance to a previously agreed amount - 80%, 90%, 100% - [(Did) / (%)(Value of property at time of loss)] x Loss Amount = Amount paid by company |
| Specific Insurance | specific limits are written for each building, contents of each building, or indirect loss |
| Blanket Insurance | single amount of coverage on more than one building |
| Straight deductible | flat amount |
| percentage deductible | percent of value of property or policy limits |
| franchise deductibles | no payment until loss equals or exceeds amount, then loss paid in full (ocean marine) |
| property insurance | payment by insurer (company) directly to insured |
| Single policy limits | single amount maximum liability paid out in an occurrence for all persons injured and property damage |
| Split Limits | expressed by two figures, maximum payable in one occurrence for each persons injured and for all injuries |
| Aggregate | limit represents total limit that is available for a policy term |
| Duties following a loss: Property AND Liability | Prompt notice given, cooperate with insurer, act in a way to preserve insurer's rights |
| Duties following a loss: Property | inventory damaged property, protect property from further loss, show damaged property, provide records & docs, report thefts, reveal any other existing insurance, submit proof of loss |
| Duties following a loss: Liability | notify insurer of claimants/witnesses, forward legal papers, aid insurer in settlements, avoid assumption of obligations |
| subrogation | transfer of the insured's rights (to collect) to the insurer |
| assignment | transfer of policy to another willn ot be valied unless consented to in writing by insurer |
| severability | insurance applies separately to each insured |
| policy period | Inception at 12:01 am/expiration at 12:01 am |
| Pro rata liability | company will pay its proportionate part that its limits bear to the total amount of all policy limits on given risk (property and liability) Example: Policy A has $200, 000. B has $100, 000 limit. Combined $300,000 coverage. For a loss, A pays 2/3, B pays 1/3. |
| Equal shares | payments based on number of policies without regards to limits. Example: policies pay equally up to their limits (liability only) |
| Primary | this policy applies first, up to its limits, before others apply (liability) |
| excess | this policy pays after all other insurance is exhausted (property or liability) |
| liberalization | policy will automatically be increased without endorsement |
| appraisal | agreement of two appraisers is binding |
| abandonment | dumping damaged property on insurer and demanding full value |
| warranty | policy condition |
| misrepresentation | untrue statement by insured, not part of policy |
| concealment | failure to reveal relevant facts |
| Triggers of Financial Responsibility Law | Bodily injury. Property damage, auto inoperative. DUI or felony. |
| Penalties of Financial Responsibility Law | Suspension of operator's Driver's License Suspension of vehicle registration |
| Avoid penalties - Financial Responsibility Law | Satisfy claims by: 1) Securing and filing release from liability by injured party 2) Found not guilty by court of law 3) Compensate for all injures Purchase Auto Insurance. File SR-22 for 3 years |
| Named Non-Owner Policy (Financial Responsibility Law) | required by operator needing to file SR-22 who does not own auto |
| DMV | Administers Financial Responsibility Law |
| Penalties for DUI (Financial Responsibility Law) | Must carry 100/300/50 min liability insurance for 3 years. Bond/certificate must be no less than $350,000. |
| Purpose of No-Fault Law | Remove certain claims from courts Have own insurer pay benefits Contain rising costs of liability insurance |
| Florida No-Fault covers | Bodily injury ONLY |
| Motor Vehicle | Self-propelled vehicle with 4 or more wheels designed for use on FL highways. Trailers and semi-trailers designed for use with those vehicles. |
| Not a motor vehicle | Mobile homes, taxicabs, limo, govt owned vehicles used in mass transit, school buses |
| Owner of a vehicle | DOLL = Debtor in posession One who holds the title Leasing with option to purchase Leasing for 6 or more months |
| Insurance & substitutes (for PIP and Financial Responsibility Law) | CABS = Cash Auto insurance Bonds Self-insurance |
| Penalties for non-compliance with PIP | RIP = Registration and DL suspended Immunity from legal liability denied Personally liable for PIP benefits up to $10,000 |
| PIP Benefits | MIDS = Medical 80% Income Loss 60% Death $5000 Services (household) 100% |
| When must non-residents comply with PIP? | Vehicle is present in FL for 90 of the preceding 365 days |
| PIP is primary except...? | Excess over Worker's Comp. |
| Extended PIP | MIDS = Medical 100% Income Loss 80% Death Same Services (household) Same |
| Additional PIP | REQUIRES EXTENDED PIP! MIDS = Medical 100% Income Loss 80% Death Same Services (household) Same Per Person maximum increased to $25,000, $40,000, and $90,000 |
| PIP deductible | $250, $500, or $1000 - comes off of medical bills before percentages are applied |
| PIP Exclusions | SOFI = Stealing Owned, but not covered Felony related injury Intentional self-inflicted injury |
| Tort Exemption | Follows the vehicle - You can't be sued for non-economic losses as long as you have PIP. Official definition is: Immunity from suits of others concerning non-economic losses (pain, suffering, mental anguish, inconvenience) is granted to those who comply with the No-Fault law. |
| Benefits under PIP follow...? | The insured. |
| PAP Declarations | Identifies the Named Insured, effective/expiration dates, coverages that apply and their limits, Loss Payee |
| Loss Payee | one who has an interest in the vehicle |
| You and Your | named insured and resident spouse |
| Bodily injury | bodily harm, sickness or disease resulting in death |
| Property Damage | physical injury to OR loss of use of TANGIBLE property |
| Business | trade, profession, occupation |
| Family member | relatives, wards, foster children IN named insured's household |
| Occupying | in, upon, or getting in, out or off |
| Trailer | vehicle designed to be pulled by private passenger, pickup or van; family wagon or farm implement while towed by vehicle |
| Your covered auto | DRATT = Declared on dec page Replacement vehicle, limit 14 days Additional vehicle for 14 days Temporary substiute Trailer owned by NI |
| Part A | Liability coverage |
| Liability coverage | pays on behalf of Insured for bodily injury and property damage; includes defense against claims |
| Supplementary Payments under Part A | LIABLE = Loss of earnings - $200/day - to attend trail/hearing Interest on judgements Appeal bonds Bail bonds - $250 Legal expenses Expenses incurred at insurer's (company) request |
| Minimum limits for Auto | 10 - Bodily Injury 10 - Property damage 10 - PIP or $30,000 |
| Auto coverage is primary. | Vehicles owned by insured. |
| Auto coverage is excess. | Vehicles not owned by insured. |
| Liability and Property Exclusions - Auto | PIRATES BELS = Property damage (property owned/rented/used Intentional Injury Regularly furnished vehicle Auto dealers Transporting using vehicles Employee injury (except no Worker's Comp) Stealing Business use Energy (nuclear) policy Less than 4 wheels Speed contests |
| Part B | Medical Payments |
| Medical Payments | pays medical and funeral expenses regardless of fault within 3 years |
| Medical Payments Limits | $500, $1000, $2000, and $5000 - apply per person per accident. |
| Pays in excess above PIP | Medical payments |
| Medical Exclusions - Auto | STORM BOS = Stealing Transporting using vehicle Occupying as residence Regularly furnished vehicle Motorcycle Business use Occupational injuryies Speed contests |
| Part C | Uninsured motorist coverage |
| Uninsured motorist coverage | Bodily injury ONLY; Accident caused by: HINDU = Hit and run Insolvent insurer No insurance Denied coverage Underinsured |
| Uninsured Motorist - min coverage | $20,000 Single, 10/20 Split |
| Options for UM coverage | Reject, Non-stacked, limits lower than Liability |
| Stacked | Coverage for two or more vehicles added together to determine the limits |
| Non-stacked | 1. Limit applicable to that vehicle is the only limit available. 2. Injured person entitled to highest UM limit available to any insured vehicle. 3. Does not apply to vehicles not insured with UM. 4. Offered at reduced rates. |
| Part D | Coverage for damage to your auto |
| Damage to your Auto | pays for direct and accidental loss of "your covered auto" and "non-owned auto" |
| Nonowned auto | private passenger auto, pickup, van, or trailer not owned by or furnished or available for regular use to insureds while being operated or in the care of the named insured or family member |
| Collision | upset or impact with another object |
| Other than collision | direct and accidental loss not covered by collision except as excluded |
| Transportation expenses | 24hrs after loss, 48hrs after theft. $20/day, $600 max. No deductible |
| Exclusions - Damage to your Auto | CREE CAR ACT = Carrying people/property for a fee Reproductive sound equipment & accessories Equipment Electrical or Mechanical breakdown Custom equipment Auto dealers Radar detectors Awnings and cabanas Confiscation by governmental authorities Trailer or camper |
| Trailer or camper | 14 days automatic coverage if acquired during policy period |
| Auto losses paid | Lesser of ACV or cost to repair or replace |
| Non-owned trailer limit | $1500 |
| Part E | Duties following a loss |
| Part F | General provisions |
| Extended Non-owned Coverage | extends coverage for Liability and optionally MedPay to non-owned auto furnished or available for regular use |
| Towing and Labor | $25, $50, $75, or $100 limits per disablement |
| Excluded Equipment Coverage | Permanently installed electronic and media equipment - no deductible; tapes, records, discs, etc. $200 limit. Customizing equipment for pickups and vans for specific amount |
| Named Non-owner Coverage | Non-owner who regularly drives other autos recieves coverage for Liability, MedPay, and UM ONLY |
| Miscellaneous Type Vehicle | Motorcycle, golf carts, motor home, ATV |
| Increased Limits Transportation Expenses Coverage | increases $20/day, $600 max to any selected limit |
| Joint Ownership | 2 or more relatives (whether or not residing together) or individuals residing together |
| Cancellation - Auto - First 60 days | May cancel for failure to respond to notice of additional premium. May cancel for total destruction, purchasing insurance elsewhere, or after selling the vehicle. |
| Cancellation - Auto - After 60 days | Must give 45 day notice for nonrenewal, 10 day notice for nonpayment. |
| Glass breakage - Auto | No deductible - front windshield only |
| Mechanical Breakdown Policy | Provides coverage against failure of original or replacement part. |
| Mechanical Breakdown Exclusions | Lack of maintenance Covered peril (under PAP) Altered odometer or parts Towing, Road service or storage charges Seals, gaskets, oil, grease, or refrigerant Tune-ups Racing Carrying passengers for hire |
| Mechanical Breakdown Policy Term | New cars - 36 months, 36,000 miles Used cars - 12 months, 12,000 miles |
| Cancellation - Mechanical Breakdown Policy | 45 days nonrenewal, 10 days nonpayment |
| Towing/Rental limits - Mechanical Breakdown | $15/day, max $75 |
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