CO Property & Casualty cheat sheet

Insurable interest requires a financial relationship; in property insurance it must exist at the time of loss, while in life insurance it must exist at policy inception.

Indemnity restores the insured to pre-loss financial status; actual cash value (replacement cost minus depreciation) is the classic indemnity valuation.

Utmost good faith requires disclosure of material facts; material misrepresentation or concealment can void coverage.

A policy is an aleatory, unilateral, conditional contract of adhesion; ambiguities are construed against the insurer.

Insurable risks are pure, accidental, measurable, definite, calculable, and not catastrophic; speculative risk is generally uninsurable.

Risk pooling spreads loss exposure; the law of large numbers improves prediction as the number of similar exposure units increases.

Peril = cause of loss (fire, wind); hazard = condition increasing the chance of loss (physical, moral, morale).

Subrogation lets the insurer pursue a liable third party after payment, preventing the insured from collecting twice.

Deductibles reduce premium and small claims by having the insured retain a specified amount of each loss.

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

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

Special limits cap coverage for categories such as money, securities, jewelry, silverware, firearms, and business property.

Coinsurance payment = (carried limit ÷ required limit) × loss, where required limit = coinsurance percentage × property value.

Actual cash value = replacement cost − depreciation; replacement cost pays new-for-old without deducting depreciation.

A mortgagee clause protects the lender's interest; the lender receives loss payments to the extent of its interest.

Commercial property uses the Building and Personal Property Coverage Form with causes-of-loss forms: basic, broad, and special.

Business income coverage pays lost earnings during the period of restoration, usually after a 72-hour waiting period.

Inland marine policies cover movable property, property in transit, and property of others.

CGL occurrence forms respond to injury or damage that occurs during the policy period, regardless of when the claim is reported.

Claims-made forms respond to claims first made during the policy period; a retroactive date bars coverage for earlier acts.

CGL limits include each occurrence, general aggregate, products-completed operations aggregate, and personal/advertising injury.

Business auto coverage uses numbered symbols to designate covered autos (e.g., symbol 1 = any auto).

Workers compensation provides medical, disability income, and death benefits; exclusive remedy generally bars employee tort suits against the employer.

Umbrella policies provide excess limits over underlying policies and may drop down to cover gaps, subject to a self-insured retention.

Negligence elements: duty, breach of duty, proximate cause, and damages.

Premises liability duties vary: invitees receive the highest duty, licensees a lower duty, and trespassers the least.

Combined single limit expresses auto liability as one dollar amount per accident rather than split limits.

The Colorado Division of Insurance is part of DORA; the Commissioner of Insurance is appointed by the Governor.

Colorado producer licenses are renewed biennially and require 24 hours of continuing education, including 3 hours of ethics.

An insurer must appoint a producer before the producer solicits or sells insurance; the appointment is filed with the Division.

Colorado property/casualty cancellation notice: 10 days for nonpayment of premium and 30 days for other reasons.

Colorado minimum auto liability limits are $25,000 per person/$50,000 per accident bodily injury and $15,000 property damage.

The Colorado FAIR Plan provides basic property insurance to applicants unable to obtain coverage in the voluntary market.

Colorado follows modified comparative negligence: damages are reduced by the plaintiff's fault, and a 50% or greater share bars recovery.

Producers hold premium funds in a fiduciary capacity and may not commingle them with personal funds.

The Colorado Insurance Code is Title 10 of the Colorado Revised Statutes; unfair trade practices are prohibited.