Tortfeasor
A persona who is responsible for the wrong
Bodily injury
Harm associated with external causes
Open policy
A contract prepared in general terms covering specified goods on agreed conditions
Freight
Money payable either for hire of a vessel or the conveyance of cargo from one port to another
Penalty
Bond limit, it reflects the amount of credit given to the principal by the surety
Contractual transfer
Generating funds from outside the business to pay for losses
What determines if a product is defective
Contains something it should not, or something should be there that was omitted in its manufacture
What other names is given to the policy that provides increased limits of liability only?
Excess liability policy, or “follow form” coverage
What purpose does the self-insured retention serve?
Has the same function as a deductible for losses not anticipated by the insurer. Encourages the insured to purchase coverage against obvious liability exposures
What is the purpose of SEF No. 5 C
Extends coverage to the lessor when insured automobiles are rented or leased to unspecified lessees for periods less than 30 days
What is the purpose of SEF 5 D
Covers losses caused by unhonest acts of the lessee
Identify three factors that affect the working capital
- Labour and material ratio
- Subcontracts
- Customer paying habits
How can the financial consequences of a loss be measured?
According to the likelihood of loss combined with seriousness or severity of losses that could occur
How can businesses that don’t have a good data base of their own loss experience still arrive at a realistic forecast?
By using probability analysis and trend analysis
Hired automobile
An auto that is hired or leased from others with or with out drivers, used under the control of the insured in the business
State four factors that influence the determination of compensatory damages
- Extent of financial support provided to injured party
- Social position
- Reputation
- Financial circumstances
Explain the assumption that lies at the centre of strict liability
Certain activities are so hazardous that in the event of injury or damage, the person conducting the activity shall be presumed to be liable
Identify two activities that impose strict liability
Setting off explosives
Lighting fires
