KY Public Adjuster flashcards

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

Kentucky Commissioner of Insurance

Appointed official who heads the Kentucky Department of Insurance and administers KRS Chapter 304, including licensing, market conduct, rate filing review, and discipline of licensees.

Public adjuster fee cap

Kentucky limits a public adjuster's compensation to 10 percent of the claim amount on claims arising from a declared disaster or emergency, and the fee must be stated in the written contract.

Unfair trade practices

Acts defined in KRS 304.12, including misrepresentation, false advertising, coercion, and unfair claim settlement practices, that subject a licensee to fines, suspension, or license revocation.

Insurable interest

A financial stake in the property insured such that the insured benefits from its preservation and suffers loss from its damage; in property insurance it must exist at the time of loss.

Principle of indemnity

The concept that insurance restores the insured to approximately the pre-loss financial position, no better and no worse; replacement cost and agreed value are recognized exceptions.

Utmost good faith

The mutual duty of insurer and insured to deal honestly and disclose material facts; a material misrepresentation on the application can allow the insurer to rescind the policy.

Subrogation

The insurer's right, after paying a loss, to pursue the responsible third party in the insured's name; the insured must not impair that right by releasing the third party.

Contract of adhesion

A contract drafted by the insurer and offered on a take-it-or-leave-it basis; ambiguities are construed against the drafter and in favor of the insured.

Actual cash value

Replacement cost minus depreciation; it reflects the value of used property at the time of loss and is the standard valuation for personal property under many dwelling forms.

Replacement cost

The cost to repair or replace damaged property with new property of like kind and quality at current prices, without deduction for depreciation, subject to the policy limit.

Appraisal provision

A policy condition allowing either party to demand appraisal when the amount of loss is disputed; each side selects an appraiser and an umpire resolves differences.

Mortgage clause

A provision protecting the lender's interest by paying loss proceeds to the lender to the extent of its interest and giving notice of cancellation or nonrenewal.

Vacancy condition

When a building has been vacant beyond the stated period, commonly 60 consecutive days, coverage is limited to specified perils and loss payment is reduced or suspended.

HO-3 special form

A homeowners form covering the dwelling and other structures on an open-peril basis and personal property on a named-peril basis; it is the most common homeowners form.

Coverage D loss of use

Pays additional living expense to maintain a normal standard of living plus fair rental value when the residence is uninhabitable due to a covered loss, for the reasonable repair time.

HO-4 renters policy

Covers a tenant's personal property on a named-peril basis plus liability and loss of use; it does not cover the building, which the landlord insures.

HO-6 condo policy

Covers a unit owner's personal property, liability, and limited building items such as fixtures, cabinets, and appliances that the association policy does not cover.

Medical payments to others

Coverage F pays reasonable medical expenses for third parties injured on the insured premises or by the insured's activities, regardless of fault, subject to a per-person limit.

Flood exclusion

Homeowners policies exclude water damage from flood, surface water, waves, and sewer backup; separate flood insurance through the NFIP or a private carrier is required.

Commercial coinsurance penalty

Formula: (insurance carried divided by insurance required) times the loss, capped at the limit, where insurance required equals the coinsurance percentage times the value at loss.

Business income coverage

Pays net income loss plus continuing normal operating expenses during the period of restoration after a covered direct physical loss, after a 72-hour waiting period.

Extra expense coverage

Pays costs to continue operations and minimize shutdown after a covered loss; unlike business income, it does not require a suspension of business.

Period of restoration

The time beginning after the waiting period and ending when damaged property should be repaired with reasonable speed or business resumes at a new permanent location.

Civil authority coverage

Pays business income and extra expense when access to the premises is prohibited by order of a civil authority due to covered damage to nearby property, typically for up to four weeks.

Blanket insurance

A single limit applies across multiple locations or coverages, and coinsurance can be satisfied by the combined values of all covered locations.

Occurrence vs claims-made

Occurrence policies cover injury or damage occurring during the policy period; claims-made policies cover claims first made during the period, subject to a retroactive date.

CGL Coverage A

Pays sums the insured is legally obligated to pay as damages because of bodily injury or property damage caused by an occurrence, subject to the each-occurrence and aggregate limits.

Additional insured endorsement

An endorsement adding a party, such as a landlord or general contractor, to the policy; the added party's coverage is limited to the scope stated in the endorsement.

Pure comparative fault

A negligence rule used in Kentucky that reduces a claimant's recovery by the claimant's percentage of fault but does not bar recovery, even if fault exceeds 50 percent.

Proof of loss

A sworn statement of the insured's claim, submitted within the period the policy requires after the insurer's request; failure to submit can bar the claim.

Recoverable depreciation

The withheld portion of a replacement cost claim paid after the insured completes repairs and submits receipts, within the policy's time limit.

Public adjuster contract

A written, signed agreement identifying the loss and the fee, disclosing that the adjuster represents only the insured, and giving the insured a period to rescind.