California P&C Insurance Exam. Pool Questions. Exam Predictor paper.

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California P&C Insurance Exam. Pool Questions. Exam Predictor paper. CODE: CIC - ✔✔california insurance code. state legislature writes the code dept of insurance enforces the code. 1. general... rules governing insurance 2. lines of insurance 3. the insurance commissioner 4. insurance adjusters CODE: Insurance Commissioner - ✔✔is elected by the people to serve a 4-year term. up to 2 terms. CODE: INS AGENT - ✔✔Appointed by and acts on behalf of the insurer. Represents one company, as a captive agent. Receives commission or sales. CODE: INS BROKER - ✔✔Represents the insured, and acts in the client's best interest. Charges a broker fee. CODE: SOLICITOR - ✔✔Is not licensed. Serves in a support capacity to the broker or agent. Can not write business. CODE: LIFE & HEALTH AGENT - ✔✔sells two lines of insurance CODE: LIFE & DISABILITY ANALYST - ✔✔is a consultant and receives a fee from the insured CODE: ADMITTED vs. NON-ADMITTED - ✔✔admitted - are approved to transact by state non-amitted - not approved. sold thru surplus lines broker CODE: DOMICILE - ✔✔domestic - ca/ca foreign - ny/ca alien - mexico/ca CODE: STOCK INSURER - ✔✔organized to make profit for their stockholders CODE: MUTUAL INSURER - ✔✔owned by policyowners CODE: MCCARRAN-FERGUSON ACT - ✔✔gave states the right to regulate insurance CODE: DIRECT MARKETING - ✔✔selling insurance out of a vending machine CODE: DEMUTUALIZATION - ✔✔when a mutual insurer changes to a stock insurer CODE: SUBROGATION - ✔✔third party substitution money rights. the insurer's right to seek recovery from a third party. the LAW of LARGE NUMBERs - ✔✔the greater the number of insureds, the more accurately we can predict the losses, and set the appropriate premium CODE: INSOLVENT - ✔✔carrier only able to provide for all its liabilities and for reinsurance of all outstanding risks. CODE: SOLVENT - ✔✔good financial standing. insurer must possess additional assets equivalent to such aggregate "paid in capital" required by the code after making provision for all such liabilities and for reinsurance CODE: BINDER - ✔✔a temporary agreement between the insurer and insured. good for 90 days/max $1,000,000 no binders in LIFE ins CODE: 770 CIC - ✔✔financing can not be contigent upon which insurance agent is being used. CODE: UNFAIR TRADE - ✔✔1. mispresentation 2. advertising membership in CIGA 3. unfair claims practices. settlement discouraging advice of attorney CODE: TORT LAW - ✔✔a type of civil law that deals with wrongful acts, and is used to determine liability. 1. unintentional tort law: texting, other negligence. 2. intentional tort law - personal injury (slander, libel, invasion of privacy) 3. absolute liability - dangerous operations GENERAL: RISK - ✔✔an uncertainty or change of loss 1. pure - only a chance of a loss or no loss. (car, home) 2. speculative - possibility of loss or gain (lottery, stockmarket) GENERAL: MANAGE RISK - ✔✔TARRtransfer - purchase insurance avoid - zero risk, if no participation reduce - implement safety techniques retain - no insurance, self ins GENERAL: HAZARD - ✔✔anything increasing chance of loss 1. moral hazard - lie on application 2. morale hazard - driving fast or wreckless 3. physical hazard - location of home, ball tires GENERAL: PERIL - ✔✔actual cause of possible loss (fire, theft, rain, etc) named peril - specifically named in policy. company covers open peril - all risk. every peril is included. GENERAL: CONCURRENT CAUSATION - ✔✔two or more perils act together (concurrently) to cause a loss. GENERAL: PROPERTY POLICY - ✔✔standard provisions in all property policies (4) 1. mortgagee clause - protects lender's rights of recovery 2. coinsurance clause - 80% of value of home 3. subrogation clause - substitute third party money rights 4. liberalization clause - broadened cov/ no add'l premium CODE: ALEATORY - ✔✔an agreement by which the exchange of money is unequal. the outcome depends on uncertain future events. GENERAL: ADHESION - ✔✔ambiguity. language in the contract is uneasy to be understood by the insured. terms are drawn up by the insurer and the insured simply must adhere. GENERAL: UNILATERAL - ✔✔the insurer makes an enforceable promise the insurer must perform GENERAL: UTMOST GOOD FATH - ✔✔rely upon the representations of the other party without attempt to conceal or deceive GENERAL: SECTIONS OF A POLICY - ✔✔D.I.C.E. Declarations Insuring Agreement Conditions Exclusions GENERAL: INSURING AGREEMENT (CLAUSE) - ✔✔the promise to pay GENERAL: CONDITIONS - ✔✔rules or rights of the insured and insurer GENERAL: DECLARATIONS - ✔✔states name and address of insured, property insured, location, description, policy period, coverage, premiums, etc. GENERAL: INSURANCE SERVICES OFFICE - ✔✔(ISO) develops insurance standard policies or standard form GENERAL: PREMIUM - ✔✔how much an insured pays to receive the rights and obligations in an insurance policy GENERAL: SHORT RATE CANCELLATION - ✔✔insured cancels policy GENERAL: PRO RATE CANCELLATION - ✔✔insurer cancels policy GENERAL: FLAT CANCELLATION - ✔✔insurer cancels and returns entire premium 25 days to return money direct to client 15 days to return money from agent to client GENERAL: DAMAGES - ✔✔1. Compensatory Damages a. special damages- medical bills, time away from wrk b. general damages - pain & suffering 2. Punitive - fine for punishment GENERAL: COMPARATIVE NEGLIGENCE - ✔✔used in (CA) GENERAL: CONTRIBUTORY NEGLIGENCE - ✔✔when an injured party contributed to his/her own injury, the claim will be negated. zero compensation GENERAL: NEGLIGENCE - ✔✔the failure to do what a reasonable and prudent person would do under normal circumstances 1. duty owned 2. resulting damages 3. breach of duty AUTO: PERSONAL AUTO POLICY covers - ✔✔1. Liability 2. Medical Payments 3. Uninsured Motorists 4. Physical Damage a. collision - impact of object or upset of car b. OTC = other than collision, comprehension PAP: MINIMUM AUTO LIABILITY COVERAGE - ✔✔. money that pays others. min 15/30/5 15 - bodily injury per person 30 - bodily injury per occurence 5 - property damage per occurrence PERSONAL AUTO: COLLISION - ✔✔impact with another vehicle or object or upset (break your own window) PERSONAL AUTO: COMPREHENSIVE (OTC) - ✔✔most claims fall under OTC: 1. acts of nature (earthquake, flood, hurricane) 2. theft - transportation expense covers $20/day max $600. first 2 days are not covered) 3. vandalism 4. object flying through air 5. fire PERSONAL AUTO: ENDORSEMENTS - ✔✔1. Mexico coverage endorsement (25 miles/10 days) 2. Miscellaneous Type Vehicle endorsement (MVE) 3. Named Non-owner Policy endorsement - borrow or rent numerous cars 4. Optional Physical Damage endorsement - (up to $200) 5. Towing and Labor Coverage - place of disablement [Show More]

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