IA Property & Casualty flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

Iowa producer license term

Iowa insurance producer licenses are issued for a three-year term and renew on a staggered basis; producers must complete continuing education requirements before renewal.

Iowa CE requirement

Iowa producers must complete 36 hours of continuing education every three years, including at least 3 hours of ethics, to maintain an active license.

Iowa auto minimum limits

Iowa financial responsibility law requires minimum liability limits of $20,000 per person, $40,000 per accident, and $15,000 for property damage.

Iowa comparative fault rule

Iowa uses modified comparative fault; a claimant whose fault exceeds 50 percent is barred from recovering damages, while fault of 50 percent or less reduces recovery proportionally.

Actual cash value

Actual cash value equals replacement cost minus depreciation. It reflects the pre-loss value of damaged property and is the default valuation in many property policies.

Coinsurance formula

Recovery equals the lesser of the policy limit or the loss multiplied by the insurance carried divided by the required insurance amount, where required insurance equals coinsurance percentage times value.

Insurable interest

An insured must have a financial stake in the property at the time of loss; otherwise the policy would encourage gambling and violate indemnity principles.

Subrogation

After paying a covered loss, the insurer acquires the insured's legal right to recover from the responsible third party, preventing double recovery by the insured.

Named peril basis

Coverage applies only to perils specifically listed in the policy; the insured bears the burden of proving the loss resulted from a listed peril.

Open peril basis

All risks of direct physical loss are covered unless specifically excluded. The insurer bears the burden of proving an exclusion applies to deny coverage.

Business income coverage

Pays the insured's lost net income and continuing normal operating expenses during the period of restoration following a covered property loss.

Occurrence trigger

Coverage applies when bodily injury or property damage occurs during the policy period, even if the claim is reported later, subject to policy terms.

Claims-made trigger

Coverage applies when a claim is first made during the policy period, and a retroactive date limits coverage for acts occurring before that date.

Exclusive remedy

Workers compensation benefits are the employee's sole legal remedy against the employer for work-related injury, barring most tort lawsuits in exchange for no-fault benefits.

HO-3 coverage basis

The HO-3 covers the dwelling and other structures on an open-peril basis, while personal property is covered on a named-peril basis.

HO Coverage D

Loss of use coverage pays additional living expenses and fair rental value when a covered loss makes the residence premises uninhabitable.

HO special limits

Homeowners policies cap theft of jewelry at $1,500, firearms at $2,500, silverware at $2,500, and money at $200 unless scheduled.

Mortgagee clause

The mortgagee clause protects the lender's interest by requiring notice of cancellation or nonrenewal and paying the lender to the extent of its interest.

PAP Part C

Uninsured and underinsured motorist coverage pays damages the insured is legally entitled to recover from an at-fault driver who lacks adequate insurance.

Split limits

Split limits express liability coverage as a per-person amount, a per-accident amount, and a property damage amount, such as 20/40/15.

Newly acquired auto

A vehicle acquired during the policy period receives coverage under the PAP, usually with a temporary period and notice requirement for physical damage coverage.

Temporary substitute auto

A vehicle borrowed or rented while the covered auto is out of service for repair or maintenance is treated as a covered auto under the PAP.

Businessowners policy

A package policy for eligible small businesses that combines commercial property, general liability, and business income coverage with optional endorsements.

Causes of loss special

The special form covers risks of direct physical loss unless excluded, shifting the burden to the insurer to prove an exclusion applies.

BOP eligibility

Businessowners policies target small businesses within eligible classes and size limits, commonly up to $6 million per building under ISO forms.

CGL Coverage B

Personal and advertising injury coverage pays for offenses such as libel, slander, invasion of privacy, and infringement of advertising ideas, not bodily injury or property damage.

Your work exclusion

The CGL excludes property damage to the insured's completed work, but many forms restore coverage for damage arising from work performed by subcontractors.

Additional insured

A person or organization granted insured status by endorsement, typically for liability arising from the named insured's operations or premises.

Duty to defend

The insurer's obligation to pay defense costs for covered claims, which is broader than the duty to indemnify and applies even to groundless suits.

Commercial auto symbol

A numerical designation on the business auto policy that identifies which autos are covered, such as owned autos, hired autos, or non-owned autos.

WC Part Two

Employers liability coverage under the workers compensation policy pays damages the employer is legally liable for outside the exclusive remedy of workers compensation.

Umbrella vs excess

An umbrella can drop down to cover gaps in underlying coverage, while excess liability follows the terms of the underlying policies and applies only above their limits.