Giving up the proprietary rights in insured property to the Underwriter in exchange for payment of a constructive total loss.
Act of God
A flood, an earthquake or other accident or event that is without any human intervention and that could not have been prevented by reasonable care or foresight but is the result of natural causes.
An individual representing the insurance company and acting for the company in working on agreements as to the amount of a loss and the liability of the company in same.
Insurance against loss or damage to property arising from any fortuitous cause, except such as may be specifically excluded.
survey of property made for determining its insurable value or the amount of
policy providing liability coverage only if a written claim is made during the
policy period or any applicable extended reporting period. For example, a claim
made in the current reporting year could be charged against the current policy
even if the injury or loss occurred many years in the past. If the policy has a
retroactive date, an occurrence prior to that date is not covered. (Contrast
this with "Occurrence Coverage").
loss arising indirectly from an insured peril.
assumed under any contract or agreement. Coverage is generally limited in
liability policies, but in most cases may be provided for an additional premium.
duty of the Assured and his broker to tell the Underwriter every material
circumstance before acceptance of the risk.
time allowed the insured after termination of certain bond and policy provisions
to discover that he has sustained a loss which occurred during the period
covered by the contract.
date on which an insurance policy or bond goes into effect, and from which
protection is furnished.
form attached to the policy bearing the language necessary to change the terms
of the policy to fit special circumstances.
basic principle of insurance. The Insured and his broker must disclose and truly
represent every material circumstance to the Underwriter before acceptance of
the risk. A breach of good faith entitles the Underwriter to avoid the contract.
(Proposed changes in law may affect this definition - also see "Utmost Good
specific situation that increases the probability of the occurrence of loss
arising from a peril, or that may influence the extent of the loss. For example,
accident, sickness, fire, flood, liability, explosion are perils. Slippery
floors, unsanitary conditions, shingled roofs, congested traffic, unguarded
premises, and uninspected boilers are Hazards.
provisional acceptance of risk, subject to confirmation at a later date that the
agreed cover is needed. Where applicable to an existing insurance, cover is
conditional, in practice, on prompt advice to the Underwriter as soon as the
Assured is aware of the circumstances to be held covered coming into effect, and
a reasonable additional premium is payable if the risk held covered comes into
A contractual arrangement whereby one party assumes the liability inherent in a situation, thereby relieving the other party of responsibility. Such agreements are typically found in contracts like leases. A typical lease may provide that the lessee must "hold harmless' the lessor for any liability from accidents arising out of the premises.
restore the victim of a loss, in whole or in part, by payment, repair or
A risk which meets most of the following requisites:
any legally enforceable obligation.
The sum or sums beyond which a liability insurance company does not protect the insured on a liability policy.
smallest premium which an insurance company will accept for writing a particular
policy or bond for a designated period.
person, firm, or corporation, or any member thereof, specifically designated by
name as insured(s) in a policy as distinguished from the others who, though
unnamed, are protected under some circumstances.
agreement whereby the Assured undertakes to declare every item (e.g. shipment,
vessel, etc. as appropriate) that comes within the scope of the cover in the
order in which the risk attaches. The insurer agrees, at the time of concluding
the contract, to accept all valid declarations up to the agreed limit for each
declaration. An open cover may be for a fixed period or always open; subject to
a cancellation clause.
insurance policy including two or more lines or types of coverages in the same
A loss under an insurance policy which does not either
other than bodily injury arising out of false arrest or detention, malicious
prosecution, wrongful entry or eviction, libel or slander, or violation of a
person's right to privacy committed other than in the course of advertising,
publishing, broadcasting, publishing, or telecasting.
cost containment technique which requires physicians to submit a treatment plan
and an estimated bill prior to providing treatment. This allows the insurer to
evaluate the appropriateness of the procedures, and lets the insured and the
physician know in advance which procedures are covered and at what rates
benefits will be paid.
recovered from a third party responsible for a loss on which a claim has been
of an amount of money related to the amount of loss to or on behalf of the
insured upon the occurrence of a defined loss.
cost of replacing property without deduction for depreciation.
on a "claims made" liability policy which triggers the beginning of
insurance coverage. A retroactive date is not required. If one is shown on a
policy, any claim made during the policy period will not be covered if the loss
occurred before the retroactive date.
fortuity. It does not embrace inevitable loss. The term is used to define causes
of loss covered by a policy.
waiver by the named insured giving up any right of recovery against another
party. Normally an insurance policy requires that subrogation (recovery) rights
liability policy designed to provide liability protection above and beyond that
provided by standard liability contracts.
period of time between the beginning of a disability and the date benefits
clause which entitles both Underwriter and Assured to take measures to prevent
or reduce loss without prejudice to the rights of either party.
statement made on an application for insurance that is warranted to be true in
all respects. If untrue in any respect, even though the untruth may not have
been known to the person giving the warranty, the contract may be voided whether
or not the untruth or inexactness is material to the risk.
The claim is paid on this occasion, although the Underwriter feels it does not attach to the policy, but this action must not be treated as a precedent for future similar claims.