HS311 Chapter 16: Introduction to Property and Liability Insurance
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Created by:
markshields on March 5, 2011
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24 terms
Terms | Definitions |
|---|---|
 real property | land and anything that is growing on it, affixed to it, and the bundle of rights inherent in the ownership |
| personal property | anything subject to ownership that is not considered real property |
| mortgage clause | a provision in a homeowners policy (when a mortgagee is listed on the policy) that imposes obligations on the mortgagee |
| loss payable clause | a homeowners policy endorsement that is used for autos and other personal property that has been financed |
| actual cash value | generally defined as replacement cost minus depreciation, unless specifically defined as otherwise in the policy |
| replacement cost | the amount needed to replace lost property (without calculating deprecation); this is often used to settle losses to the dwelling |
| agreed value | a replacement amount agreed upon between the insurer and the insured; typically done for unique or hard to replace items |
| stated amount | the value of property as stated in the policy; upon a loss the insurer pays the stated value or actual replacement cost, whichever is least |
| valued policy laws | some states mandate that the stated value for real property is paid when a total loss occurs, even if the replacement cost is less |
| named-perils coverages | the policy states exactly which perils are covered, and anything not stated in the policy is not covered |
| open-perils coverages | the policy covers all perils unless specifically excluded in the policy language |
| other insurance clause | policy language that explains how an insurer's obligations are affected when other insurance covers the same loss |
| coinsurance provision (property insurance) | a way of penalizing for under insuring property; if a policyholder is under insured he will receive partial payment for a loss, even for a partial loss within limits of the policy |
| compensatory damages | damages that are covered to financially compensate or reimburse a claimant who has suffered a loss |
| punitive damages | damages that are designed to punish a wrongdoer whose conduct has caused another party to suffer a loss |
| property damage | can be measured as actual loss to the property, as well as loss of income due to the loss of the property |
| personal injury | related to liability; libel, slander, invasion of privacy |
| contractual liability | failure to satisfy contractual obligations (e.g. breach of contract, damage to someone's property while in your care) |
| strict liability | also known as absolute liability; a person is held liable for damages whether or not they were a result of negligence |
| negligence | the failure to exercise the proper degree of care required by circumstances |
| contributory negligence | an injured person cannot collect damages from another negligent person if he is also negligent |
| last clear chance doctrine | the idea that a negligent party can recover damages from another negligent party that failed to exercise a last clear chance to avoid an accident (e.g. a jaywalker proves that a driver could have easily avoided hitting him) |
| comparative negligence | damages are reduced in proportion to the amount of negligence belonging to the injured person |
| imputed negligence | the owner or operator of a property can be held liable if someone acted on their behalf in a negligent way (e.g. an employer can be held liable for an employee's actions) |
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