CISR cheat sheet

Producer authority is classified as express (written in the agency agreement), implied (reasonably necessary to carry out express duties), or apparent (created by the insurer's conduct toward the insured).

A certificate of insurance is only evidence of coverage; it does not amend, extend, or create coverage and confers no contractual rights on the certificate holder.

Premiums collected by an agency are held in a fiduciary capacity; commingling premium funds with agency operating money is prohibited and can create personal liability for the principal.

E&O defense rests on contemporaneous documentation: file notes, emails, and written coverage confirmations recorded at the time of the transaction.

An agency cannot bind a risk the carrier has not authorized it to write; binding authority exists only as granted in the agency-carrier contract or through implied/apparent authority.

The GLBA Safeguards Rule requires a written information security program protecting nonpublic personal information; HIPAA governs protected health information separately.

Most states impose no general duty to advise; a special relationship (long-term reliance, paid counseling, or a request for specific advice) can create one.

Record retention follows state statute and the carrier contract, commonly 5 to 7 years after expiration, but claims-made E&O tail exposure may require longer.

Agency E&O policies are written claims-made; the retroactive date and extended reporting period determine which claims are covered.

CGL Coverage A (Bodily Injury and Property Damage) and Coverage B (Personal and Advertising Injury) share the general aggregate; products-completed operations carries its own separate aggregate.

The CGL is an occurrence form: the policy in force when the injury or damage occurs responds, even if the claim is reported years later.

The contractual liability exclusion is carved back by the definition of 'insured contract' - leases of premises, easements, and certain business agreements.

The damage-to-property exclusion removes coverage for property in the insured's care, custody, or control and for the insured's own product or work.

The 'your work' exclusion contains a subcontractor exception: damage to the named insured's work performed by a subcontractor on its behalf is covered.

Damage to premises rented to the insured (fire legal liability) is barred by the care/custody/control exclusion unless coverage is added by endorsement.

Umbrella policies drop down over gaps and self-insured retentions and may broaden coverage; excess policies follow the underlying form and sit only above scheduled limits.

Additional insured endorsements should state primary and noncontributory wording so the additional insured's own policy does not share the loss.

Employer's liability for employee bodily injury is excluded under the CGL; workers compensation and employers liability are the intended markets.

Business auto symbols: 1 any auto; 2 owned autos only; 3 owned private passenger; 4 owned autos other than private passenger; 5 owned autos subject to no-fault; 6 owned autos subject to compulsory UM; 7 specifically described autos; 8 hired autos only; 9 nonowned autos only.

Hired auto liability covers autos the insured leases, hires, rents, or borrows; employee-owned autos used in the business fall under nonowned auto (symbol 9), not hired auto.

Workers compensation Part One pays statutory benefits with no dollar limit; Part Two employers liability responds to injury suits with per-accident, per-employee, and policy aggregate limits.

Statutory WC benefits include medical care, disability income (TTD, TPD, PPD, PTD), death benefits, and rehabilitation.

The experience modification factor compares actual to expected losses for the class; below 1.00 is a credit and above 1.00 is a debit applied to manual premium.

The exclusive remedy doctrine makes WC the employee's sole remedy against the employer for work-related injury, absent intentional acts.

Garage keepers coverage insures customer vehicles in the insured's care, custody, and control and can be written on a direct (primary) or legal liability basis.

Motor truck cargo and bailee exposures are not covered by the business auto policy; separate inland marine forms are required.

Business auto physical damage provides collision and other-than-collision coverage, each with its own deductible per covered auto.

The risk management process runs: identify exposures, analyze and measure them, select techniques, implement the program, then monitor and revise.

Five treatment techniques: avoidance, loss prevention (reduces frequency), loss reduction (reduces severity), retention, and transfer.

Only pure risk (chance of loss or no loss) is insurable; speculative risk (chance of gain or loss) generally is not.

Insurable risk must be fortuitous, definite and measurable, spread over many similar exposure units, not catastrophic, and have a calculable probability at an affordable premium.

Peril is the cause of loss; hazard is a condition that increases the chance or severity of loss; the exposure unit is the thing exposed to loss.

Physical hazards are tangible conditions; moral hazards involve dishonesty; morale hazards involve indifference or carelessness.

The law of large numbers makes predicted loss experience more reliable as the number of independent similar exposure units increases.

Frequency/severity matrix rule: retain high-frequency, low-severity losses; transfer low-frequency, high-severity losses; avoid exposures whose severity is unaffordable.

Adverse selection - insuring a disproportionate share of high-risk applicants - is controlled through underwriting, rating classes, and policy provisions.

Valuation rule: actual cash value equals replacement cost minus depreciation; replacement cost coverage requires insuring to at least the coinsurance percentage (commonly 80% or 90%) of value.

Coinsurance recovery = (limit carried ÷ limit required) × loss, capped at the policy limit and then reduced by the deductible.

The Agreed Value option suspends the coinsurance clause when the insured submits a signed statement of values.

Causes of Loss forms: Basic (CP 10 10), Broad (CP 10 20), and Special (CP 10 30); the Special form covers risks of direct physical loss unless excluded.

Vacancy beyond 45 days (60 days for water damage) eliminates or restricts coverage for vandalism, glass, water damage, and certain other causes.

Ordinance or law is excluded except for limited increased cost of construction coverage (commonly 10%), which can be increased by endorsement.

Business income pays lost net income and continuing expenses during the period of restoration; extra expense funds costs incurred to avoid or shorten a shutdown.

Civil authority business income coverage typically carries a 72-hour waiting period before it responds.

Equipment breakdown, flood, and earthquake are excluded and require separate policies or endorsements.

PAP structure: Part A Liability, Part B Medical Payments, Part C Uninsured/Underinsured Motorists, Part D Damage to Your Auto, Part E Duties After an Accident, Part F General Provisions.

Newly acquired auto: coverage applies for 14 days when the insured has no other auto coverage, or 4 days when other coverage exists, using the broadest coverage on any owned auto.

A temporary substitute auto is a non-owned vehicle used while a covered auto is out of service due to breakdown, repair, servicing, loss, or destruction.

Liability limits are written either as split limits (bodily injury per person/per occurrence plus a property damage limit) or as a combined single limit.

UM pays for injuries caused by an uninsured or hit-and-run driver; UIM pays the gap between the at-fault driver's payment and the insured's damages.

Part D offers collision and other-than-collision coverage, each with its own deductible; transportation expenses and towing are added by endorsement.

Public or livery conveyance is excluded; rideshare driving requires a specific endorsement to restore coverage.

Intentional acts, racing, and use of a vehicle without a reasonable belief of entitlement are excluded under the liability part.

A named driver exclusion removes all coverage while the excluded person operates the vehicle and must be signed by the named insured.

HO-3 covers the dwelling and other structures on an open-peril basis and personal property on a named-peril basis; HO-5 covers both on an open-peril basis.

Standard HO limits: Coverage B other structures is 10% of Coverage A; Coverage C personal property is 50% of Coverage A; Coverage D loss of use is 30% of Coverage A.

Dwelling replacement cost settlement requires insurance to at least 80% of full replacement cost; below that, loss settlement is reduced.

Personal property is settled at actual cash value unless replacement cost contents coverage is endorsed onto the policy.

Special limits restrict money, securities, theft of jewelry and furs, theft of firearms, theft of silverware, and business property both on and off the premises.

The Section I deductible applies per occurrence; separate percentage deductibles commonly apply to windstorm or hail in coastal areas.

Loss of use pays additional living expense and fair rental value for the shortest time needed to repair, replace, or relocate, subject to a stated limit.

Common exclusions include flood, earth movement, neglect, intentional loss, ordinance or law, and business pursuits under the liability section.

The mortgage clause protects the lender's interest and allows the lender to receive loss payment and submit proof of loss if the insured does not.

Term life provides pure death protection with no cash value; variations include level, decreasing, renewable, and convertible term.

Whole life has level premiums for life, guaranteed cash value, and often participating dividends; unpaid policy loans reduce the death benefit.

Universal life separates mortality charges from cash value, allowing flexible premiums and adjustable death benefits; Option A is level and Option B is increasing.

Variable life and variable annuities are securities: they use a separate account and require a prospectus and FINRA-registered representatives.

Incontestability and suicide clauses generally run two years from issue; misstatement of age or sex adjusts the benefit rather than voiding the contract.

Health plan types: indemnity (fee-for-service), HMO (gatekeeper, in-network only), PPO (network with out-of-network benefits), and POS (hybrid).

Disability definitions: own-occupation is broader and costlier, any-occupation is narrower, and the elimination period is the waiting time before benefits begin.

COBRA continuation runs 18 months for termination or reduced hours, 29 months for disability, and 36 months for divorce, death, or dependent status loss.

Group life conversion lets a terminating employee convert to individual coverage without evidence of insurability within a stated window.

A personal umbrella requires scheduled underlying auto, homeowners, and watercraft limits; it drops down over gaps and self-insured retentions and broadens liability coverage.

NFIP dwelling form maximums are $250,000 on the building and $100,000 on contents, with a general 30-day waiting period before coverage takes effect.

Dwelling policies (DP-1, DP-2, DP-3) insure non-owner-occupied or rental dwellings and contain no liability coverage unless added by endorsement.

A personal articles floater insures scheduled valuables on an open-peril, worldwide basis at agreed value, typically without a deductible.

A difference in conditions (DIC) policy fills gaps left by standard property forms, such as flood or earthquake, and usually carries its own deductible.

Home-based business exposure is handled by endorsements for incidental business pursuits or permitted incidental occupancy, or by a separate commercial policy.

Watercraft and personal watercraft liability can be endorsed to the HO policy or written on a separate boatowners policy; endorsements usually limit horsepower and length.

Earthquake coverage is added by endorsement and typically applies a separate percentage deductible based on Coverage A.

Identity theft endorsements reimburse expenses and provide restoration services and sit outside the standard HO special limits.