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RMI 3011 exam 2

Terms in this set (69)

Legal wrong
a violation of a person's legal rights, or a failure to perform a legal duty owed to a certain person or to a society as a whole (crime, breach of contract, tort)
Tort
any legal wrong that results in a payment
3 categories of torts
intentional, negligence, strict liability
intentional tort
Knowingly commiting a wrongful act
Strict Liability
The legal responsibility for damage or injury even if you are not negligent (owning dangerous animals) found guilty 100% of the time
Negligence
failure to exercise the standard care to protect others from an unreasonable risk of harm. standard care is not the same for each wrongful act
*Plaintiff
the person who is injured
*tortfeasor (defendant)
person who allegedly damages plaintiff
*who sues who for damages?
The person who is injured (plaintiff) by the action of another (tortfeasor) can sue for damages
Elements of Negligence
legal duty to use reasonable care, failure to perform that duty, damage/injurey to the claimant, and a proximate cause
legal duty to use reasonable care example
employee at store sees person fall at their store, legal duty to help or lifeguard sees drowning person, legal duty to safe them
failure to perform that duty example
lifeguard doesn't try to save drowing kid
damage/injury to the claimant
can be damage to physical property
proximate cause
The connection between an act and an injury is strong enough to justify imposing liability (I have product, sell to wholesaler, but they change something to the product therefore it's a broken chain of events)
*Compensatory Damages
compensate the victim for losses actually incurred
*Special Damages
A form of compensatory damages that awards a sum of money for specific, identifiable expenses associated with the injured person's loss, such as medical expenses or lost wages. (provide compensation for medical expenses due to injury)
*general damages
provide compensation for pain and suffering (loss of a companion, emotional damages)
*Punitive damages
designed to punish people and organizations so that others are deterred from committing the same wrongful act
Contributory negligence law
the injured person cannot collect damages if his or her care falls below the standard of care required for his or her protection (must be 0% at fault)
Comparative negligence law
the financial burden of the injury is shared by both parties according to their respective degrees of fault (how much you contributed to the injury is removed)
pure rule
you can collect damages even if you are negligent, but your reward is reduced in proportion to your fault (70% responsible...collect 30%)
50% rule
you cannot recover if you are 50% or more at fault
51% rule
you cannot recover if you are 51% or more at fault
**$10,000 loss, 50% responsible
contributory=
pure=
50% rule=
51% rule=
contributory=$0
pure=$10K*0.5=$5K->$10K-$5K=$5K collcted
50% rule=$0
51% rule=$10K*0.5=$5K->$10K-$5K=$5K collcted
last clear chance rule
a plaintiff who is endangered by his or her own negligence can still recover damages from the defendant if the defendant has a last clear chance to avoid the accident but fails to do so
assumption of risk doctrine
a person who understands and recognizes the danger inherent in a particular activity cannot recover damages in the event of an injury (5k race, I can sprain my ankle so I cannot collect)
Imputed Negligence
under certain conditions, the negligence of one person can be attributed to another (I work at BCR and hand baby tiger to someone, they get scratched, I will be named in lawsuit but Big Cat rescue is liable)
vicarious liability law
a motorist's negligence is imputed to the vehicle's owner
family purpose doctrine
the owner of an auto can be held liable for negligent acts committed by family members (I take husbands car, I get in a accident, he's liable bc it's his car)
joint business venture
Negligent actions of one business partner can be imputed to other partners.
dram shop law
a business that sells liquor can be held liable for damages that may result from the sale of liquor (you go on a bar crawl, you injure someone while driving, all bars you went to and drank at can be held liable)
Res Ipsa Loquitur
"the thing speaks for itself" (situation wouldn't occur if it wasn't for the defendants actions)
3 requirements to apply res ipsa loquitur
-The event is one that normally does not occur in the absence of negligence
-The defendant has exclusive control over the instrumentality causing the accident
-The injured party has not contributed to the accident in any way
*Trespasser
a person who enters or remains on the owner's property without the owner's consent
duty of slight care
duty to refrain from injuring a trespasser (I am doing construction at bacon land, someone climbs fence, they fall in a hole and break leg, I am slightly liable)
*Licensee
a person who enters the premises with the occupant's expressed or implied permission and they don't benefit you by being there. ex. House guests (must warn of danger but dont need to prevent it)
*Invitee
a person who is invited onto the premises for the benefit of the occupant. ex. mailman, customers (have to warn of danger and correct/prevent danger)
Attractive Nuisance
a hazardous condition that can attract and injure children. Occupants of land are liable for injuries that occur
ex. pool, tramponline
sovereign immunity
has been modified over time
Respondeat Superior
an employer can be held liable for the negligent acts of employees while they are acting on the employer's behalf (Must have employee employer relationship, mall cop is contractor so Walmart isn't liable the Co. the cop works for is liable)
*requirement to respondeat superior
worker must be an employee
*Parents can be held liable for the actions of a child if:
the child uses a dangerous weapon to injure someone, the child is acting as an agent for the parents, a minor child is operating a family car
*State tort reforms include:
-Capping noneconomic damages, such as pain and suffering (hospital bills)
-Reinstating the state-of-the-art defense for product liability cases (anything new and innovative, encourage innovation)
-Restricting punitive damages awards (PDA=don't need to be link to damages, can be outrageous monetary value)
-Modifying the collateral source rule (individual in car accident, collects work comp, and can sue defendant like double dipping)
-Modifying the joint and several liability rule (doesn't matter what % at fault)
-Alternative dispute resolution (ADR), a technique for resolving a legal dispute using arbitration (independant 3rd party makes decision) or mediation (come together with 3rd party and make decision as a group)
Declarations
statements that provide information about the particular property or activity to be insured (1st page)
Insuring agreement
summarizes the major promises of the insurer
2 basic forms of an insuring agreement in property insurance
named perils coverage, open-perils/special coverage
Named perils coverage
only those perils specifically named in the policy are covered
open-perils/special coverage
all losses are covered except those losses specifically excluded
exclusions
if there is cover elsewhere it won't be covered in the insurance contract
3 major types of exclusions
excluded perils (flood, acts of war), excluded losses (a professional liability loss is excluded in the homeowners policy), excluded property (pets arent covered as personal property in the homeowner's policy)
attitudinal hazard problems
individuals are forced to bear losses that result from their own carelessness
conditions
- provisions in the policy that qualify or place limitations on the insurer's promise to perform
- if conditions aren't met, the insurer can refuse to pay the claim
Named Insured
The individual(s) whose name appears on the policy's declaration.
First Named Insured
the first name that appears on the declarations page of the policy as an insured and has addition rights/responsibilities
endorsement
A written provision that adds to, deletes from, of modifies the provisions in the original contract (earthquake endorsement to a homeowners policy)
- property and casualty
Rider
in life and health insurance, a provision that amends or changes the original policy (a waiver-of-premium rider on a life insurance policy)
Deductible
Amount you must pay before you begin receiving any benefits from your insurance company
purpose of deductible
-Eliminate small claims that are expensive to handle and process
-Reduce premiums paid by the insured
-Reduce moral hazard and attitudinal (morale) hazard
straight deductible
the insured must pay a certain number of dollars of loss before the insurer is required to make a payment
aggregate deductible
all losses that occur during a specified time period, usually a year, are accumulated to satisfy the deductible amount
calendar year deductible
a type of aggregate deductible that is found in basic medical expense and major medical insurance contracts
elimination (waiting) period
a stated period of time at the beginning of a loss during which no insurance benefits are paid
Coinsurance Clause
in a property insurance contract encourages the insured to insure the property to a stated percentage of its insurable value
-**has to be met at the time of the loss**
the fundamental purpose of coinsurance is to achieve...
equity in rating
health insurance policies frequently contain...
coinsurance clause
coinsurance clause
requires the insured to pay a specified percentage of covered medical expenses in excess of the deductible
the purpose of coinsurance in health insurance are to...
reduce premiums and prevent overutilization of policy benefits
pro rata liability
each insurer's share of the loss is based on the proportion that its insurance bears to the total amount of insurance on the property
contribution by equal shares
each insurer shares equally in the loss until the share paid by each insurer equals the lowest limit of liability under any policy, or until the full amount of the loss is paid
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