Rhode Island Property and Casualty Insurance Producer flashcards

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

Principle of indemnity

The principle that insurance should restore the insured to approximately the same financial position as before a loss, without profit, subject to policy limits and exceptions such as valued policies.

Insurable interest

A financial relationship in which the insured benefits from preservation of the subject matter or suffers pecuniary loss from its damage, destruction, or liability event.

Utmost good faith

An insurance contract doctrine requiring both parties to disclose material facts honestly; concealment or material misrepresentation can allow the insurer to rescind or deny coverage.

Waiver and estoppel

Waiver is voluntary relinquishment of a known right; estoppel prevents a party from asserting a right after inducing another party's reasonable reliance on contrary conduct.

Actual cash value

A property loss valuation method equal to replacement cost minus depreciation, reflecting the property's pre-loss market value and subject to the policy limit and deductible.

Coinsurance formula

Recovery equals loss multiplied by insurance carried divided by insurance required, where required insurance equals the coinsurance percentage times replacement cost, capped by the policy limit.

Named perils coverage

A property coverage form that pays only for causes of loss specifically listed in the policy, placing the burden on the insured to show a listed peril caused the damage.

Mortgagee clause

A policy provision protecting a lender's interest in insured property by allowing the lender to receive loss payments and notice, even if the insured's acts impair coverage.

Occurrence policy

A liability policy that covers injury or damage occurring during the policy period, regardless of when a claim is later reported, subject to policy terms and limits.

Claims-made policy

A liability policy covering claims first made during the policy period, usually subject to a retroactive date, rather than covering based on when the injury occurred.

Negligence elements

A liability claimant generally must prove duty, breach of that duty, proximate cause, and actual damages to establish a negligence claim against an insured.

HO-3 policy

A homeowners form insuring the dwelling and other structures on an open peril basis and personal property on a named peril basis, with liability and medical payments coverage.

HO-4 renters policy

A homeowners form for tenants that insures personal property, loss of use, personal liability, and medical payments, but does not insure the rented building structure.

Flood insurance waiting period

National Flood Insurance Program policies generally take effect 30 days after application and premium payment, with limited exceptions such as certain loan closings and map changes.

HO Coverage D

Loss of use coverage pays additional living expenses and fair rental value loss when a covered peril makes the residence premises uninhabitable, subject to stated limits and time restrictions.

HO special limits

Homeowners policies cap recovery for categories such as cash, jewelry, silverware, firearms, money, and business property, often requiring scheduled endorsements for higher values.

Personal auto Part A

Personal auto liability coverage pays damages for bodily injury and property damage the insured becomes legally liable for because of an auto accident, up to stated limits.

Uninsured motorist coverage

Coverage that pays the insured for bodily injury caused by an uninsured or hit-and-run driver, subject to policy limits and state-specific rules on stacking and setoff.

Collision coverage

Personal auto physical damage coverage for impact with another vehicle or object, or overturn, subject to a deductible and the vehicle's actual cash value or repair cost.

Other than collision

Personal auto physical damage coverage for causes such as theft, fire, hail, flood, vandalism, and glass breakage, often called comprehensive coverage and subject to a deductible.

Business income coverage

Commercial property coverage that pays net income loss and continuing normal operating expenses during the period when operations are suspended by a covered cause of loss.

Blanket insurance

A commercial property approach applying one limit of insurance across multiple covered locations, buildings, or property categories, rather than separate scheduled limits for each item.

Causes of loss forms

Commercial property forms that define covered perils: basic lists specified perils, broad adds more specified perils, and special provides open peril coverage subject to exclusions.

Workers compensation Part One

The part of a workers compensation policy providing statutory benefits required by state law for employee work-related injury, disability, or death, without regard to fault.

CGL products-completed operations

General liability coverage for bodily injury or property damage occurring away from the insured's premises and arising from products sold or work completed by the insured.

Commercial auto symbols

Numbers on a business auto policy that designate which autos are covered, such as owned autos, hired autos, non-owned autos, or specifically scheduled vehicles.

Producer appointment

An insurer's authorization for a licensed producer to act on its behalf; the insurer generally files appointment information with the Rhode Island insurance regulator and maintains it during the relationship.

Premium fiduciary duty

A producer's obligation to hold premiums in a fiduciary capacity, account for them accurately, and remit them to the insurer or insured as required by law or agreement.

Unfair trade practices

Prohibited insurance market conduct such as misrepresentation, twisting, rebating, coercive sales tactics, and unfair claim settlement practices, subject to regulatory enforcement and penalties.

Proof of loss

A sworn statement submitted by an insured that documents the claimed loss, its cause, amounts sought, and supporting information, as required by the policy and claim process.

Reservation of rights

A written notice in which an insurer accepts defense of a claim while preserving the right to later deny coverage for specific policy reasons, avoiding waiver of coverage defenses.

Errors and omissions

Professional liability coverage for producers and other insurance professionals against claims alleging negligent acts, failure to procure coverage, or inadequate advice causing financial harm.