South Carolina Insurance Basics

An exchange of unequal amounts or values. Premium paid by the insured is small in relation to amount paid by insurer.

Relinquishing of insured property into the hands of another, or into the possession of no one in particular

Used as a lower cost alternative to lawsuit. Parties agree to resolve issue using a panel chosen by the court.

Provision in the policy that states in the event of a loss the insured can only collect up to the extent of the loss.

Because the company has the right to decide who it will and will not do business with, and insurance contract is a:

All of the following are elements of a legal contract Except:

SC law referred to as a stated amount, applied to real property being insured for losses cause by peril of fire.

Method of valuing a loss based upon the amount a willing buyer would pay to a willing seller for the property.

Property insurance clause that extends broader coverage to current polices as long as it doesn't result in higher prices

A primary policy is a policy that pays second in the event of a covered loss.

All of the following are duties of the insured after a loss except:

This doctrine transfers liability of one person to another person who would have a greater ability to pay. ex: parents

Describes coverage under an insurance policy form that lists specific covered perils

This must exist at the time of loss.

Condition of the subject of insurance that creates or increases the chance of loss, such as structural defects.

Failure to use the care that a prudent person would have taken under the same circumstances.

Interruption of the chain of events; sets in motion a new chain of events.

Current Replacement Cost - Depreciation=

When the injured party does not need to prove negligence. Defendants engaged in hazardous activities.

After a right or privilege has been waived, a party can't re-assert that right Which legal process is this?

The reduction, decrease or disappearance of value of the person or property insured in a policy, caused by a peril.

The cost to replace damaged property with less expensive and more modern construction or equipment.

Represents a fair valuation for the property at the time the insurance is written and suspends any coinsurance.

Types of risk that are not insurable, involves the opportunity for loss or gain. Example is Gambling.

At the time a policy is written, the insured ha several options as to how a loss will be valued. This is called..

A contract of adhesion is prepared by one of the parties (insurer) and drawn up by negotiations between two parties.

Legal Duty, Standard of Care, Proximate Cause and Actual Loss or damage are elements of what act?

Person or business that manufactures or sells a product makes an implied warranty that the product is safe.

Sharing of a loss with other insurance that may be written on the same risk in the same proportion as their limits.

All of the following are defenses against negligence except:

When a fan sits court side at a basketball game, they chose to undergo the risk of getting hit. This is.

Waiver is the voluntary act of relinquishing a legal right, claim or privilege.

Requires that certain conditions must be met by the policyowner and the company in order fro the contract to be executed

Fault is shared between the parties involved and the awards for damages are reduced by the % of negligence of each party

Only type of risk insurance companies are willing to accept. No opportunity for financial gain.

Uncertainty or chance of a loss occuring

Protects policyholders from insurer insolvencies.

Applicants who demonstrate a careless attitude that could increase the chance of loss.

Insurers legal right to seek damages from third parties, after it has reimbursed the insured for the loss.

Condition or situation that creates or increases the probability of or extent of a probable loss from a peril.

All of the following are elements of an insurable risk except:

In a ______ contract, only one of the parties to the contract is legally bound to do anything, the insurer.

Dishonest predisposition on the part of an insured that increases the chance of loss.

Loss valuation by like kind and quality at today's price.

______ limit is the maximum limit of coverage available under a liability policy during a policy year.