P&C Ch 4 Basic of Liability

  1. Which of the following does NOT follow the concept of indemnification?
    a.compensatory damages
    b. special damages
    c.general damages
    d. punitive damages
    punitive damages
  2. Which is true about Umbrella Liablity policies?
    a. they are extremely expensive
    b. they are designed to be the primary payor
    c. they are written for excessive amounts
    d. they are the same as excess liablity policies
    they are written for excessive amounts
  3. A demolition company is using dynamite to destory a old downtown building. Which of the following applies?

    C. absolute liablity
  4. The liablity term used to describedamage to an individual's reputation is
    a. bodily injury
    b. property damage
    c. personal injury
    d. advertising injury
    personal injury
  5. Which of the following is true concerning the Medical Payments section of a Liablity contract?
    a. it pays only if the insured is legally liable
    b. it can pay for the injured party's lost wages
    c. it has rather low dollar limits
    d. it pays in addition to any liablity judgment
    it has rather low dollar limits
  6. You are hit by a Greyhound bus. The incident is

    C. both an accident and an occurance
  7. Which of the following is NOT negligence
    a. ignorance
    b. inaction
    c. carelessness
    d. intentional act
    intentional act
  8. Which of the following is true concerning defense costs in a liablity contract?
    a. they only pay if you are legally liable
    b. they pay in addition to the limits of the policy
    c. they must be purchased seperatley
    d. they can cover the insured's cost of suing a negligent party.
    they pay in addition to the limits of the policy
  9. Assuming that Cal's Commericial Liablity policy has an occrrence limit of $100,000 and an aggregatelimit of $500,000. Further assume that so far this year, his insuror has paid claims of $420,000. When an injured shopper is awared $90000, how much will Cal's company pay?

    C. 80,000
  10. Fire Legal Liability is most importatnt to
    a. landlord
    b. mortageee
    c. employee
    d. tenant
  11. what is bodily injury?
    is injury (including death) caused to a human being
  12. What is property Damamge?
    its damage caused to property
  13. Personal injury is what?
    damage to repuation or mental state
  14. What is advertising injury?
    It is damage to the reputation of a business
  15. Negligence is the failure to act in a ________ manner in circumstances where a loss can occure.
  16. Negligence is never an __________ act
  17. there are four steps required to legally prove  negligence what are they?
    • 1. there must be a duty to protect others
    • 2. there must be a Breach of that duty
    • 3. there must be proximate cause meaning the Breach of Duty must have caused the injury
    • 4. financial damage must be present
  18. An accident is:
    an event that is unforeseen and unitended
  19. Liablity policies only pay when there is a legal ______ to do so
  20. Settlement by the insurance company or a court order judge are ways that the insured becomes legally _______
  21. Compensatory Damages are meant to:
    Compensate teh injured parties
  22. Punitive Damages are designated to punish the party that _______ the injury
  23. Comparative Fault is a legal defense to negligence that may reduce the amount of a _________
  24. Assumption of Risk is a legal defenceto negligence that argues the injred party being knew they were participating in a dangerous activty at the ______ of the _____
    time of the injury
  25. medical Payments are paid without
    respect to fault
  26. Medical payments are a goodwill gesture meant to lessen the likelihood of a _______
  27. Supplementary pament means
    defense cost
  28. Supplementary payments are typically paid in addition to the ______ _______.
    policy limits
  29. It is the Insurance Company's choice to defend an insured. If they elect to defend they will pay ______ ______
    defence costs
  30. Vicarious Liablity means that a person or entity can be held liable for the actions of _______
    another (employer in the actions of the employee for example)
  31. Absolute Liablity means that liablity can sometime sbe present wven without negligence. A company that has wild animals would be liable if the wild animal _____ ______
    hurt someone
  32. An umbrella Liability policiy can pay in addition to _______  ________
    underlying liablity
Card Set
P&C Ch 4 Basic of Liability
Basic Liability insurance