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42 Cards in this Set

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Insurable Interest

An interest in the subject of an insurance policy that is not unduly remote and that would cause the interested part to suffer financial loss if an insured event occured. Ex: a car you own is insurable interest. Best friends car is not yours so no insurable interest.

Contract of Indemnity

A contract in which the insurer agrees, in the event of a covered loss, to pay an amount directly related to the amount of loss. Ex: Insurance contract

Joint owners/ Tenants

Two or more persons each having full interest in the property. Each tenant has an insurable interest to the full extent of the property value. All on the settlement draft.

Tenancy by the Entirety

A joint tenancy between husband and wife

Tenancy in Common

A concurrent ownership of property, in equal or unequal shares, by two of more joint tenants who lack survivorship rights. Own a piece of property but each has a distinct fraction or percentage.

Life Tenant (life estate)

A person entitled to exclusive possession of real property and to all income the land produces for the duration of that person's or someone elses's life; terminate on the death of the life tenant and does not pass to his or her estate.

Sole proprietorship

A form of business in which one person owns the business assets and is personally liable for the business’s debts.

Partnership

A for-profit business entity jointly owned by two or more persons who share ownership and profits (or losses), although not necessarily on an equal basis.

Corporate Veil

A doctrine that insulates the assets of the owners of the corporation in case the corporation goes bankrupt. The corporation’s owners, the stockholders, are not personally liable for the corporation’s debt.

Limited Liability (LLC)

A form of business entity that provides its owners the limited liability of a corporation and the tax advantages of a partnership.

Tenant (lessee)-

Someone who pays to use, possess, or occupy property belonging to another.

Bailee

The party temporarily possessing the personal property in a bailment. Examples include repairs shops and dry cleaners.

Cosignee

The person or organization that receives property being transported by a carrier.

Common carriers

Airlines, railroads, or trucking companies that furnish transportation to any member of the public seeking their offered services

Guardian

A person appointed by a probate court to safeguard and distribute the estates assets for a minor’s or incompetent’s benefit.

Trustee

Someone who has the legal title to a property but is responsible that it be used, handled, and transferred solely for the benefit of the beneficiary.

Security interest

An interest in property (real or personal) that allows the property to be sold on default to satisfy the debt for which the security interest was given. Example those who hold Mortagage or lien on property.

Mortgage

An interst in land created by a written document that provides security for the payment of debt

Mortgagee

A lender in a mortgage arrangement, such as a bank or another financing instituition.

Loss Payee

A party entitled to share in whatever loss payment an insured receives.

Lien

A creditor’s legal right or interest in another’s property, usually lasting until satisfaction of the specific debt of duty that the lien secures

Mechanic's Lien

A lien granted by law to anyone who repairs a specific piece of property, that secures payment for the repairs. Example a roofer would have this lien or auto mechanic on auto

Tax Lien

A type of lien held by local, state, and federal governments through operation of law in the amount of unpaid taxes and interest.

Judgement Lien

A lien, in favor of the holder of a judgment, that attaches to the property of the one who owes the judgment.

Purchase Money security Interest

A type of security interest that gives the holder priority in foreclosures over subsequent lienholder or general.

Asignee

The individual or entity to whom property, rights, or interest have been transferred.

Real Property ( Realty )

Tangible property consisting of land, all structures permanently attached to the land, and whatever is growing on the land.

Personal Property

All tangible or intangible property that is not real property

Coinsurance

An insurance-to-value provision in many property insurance policies providing that if the property is underinsured, the amount that an insurer will pay for a covered loss is reduced

Fixture

Any personal property affixed to real property in such a way as to become part of the real property.

Trade Fixtures

Fixtures and equipment that may be attached to a building during a tenant’s occupancy, with the intention that they be removed when the tenant leaves.

Improvements and betterments

Alterations or additions made to the building at the expense of an insured who does not own the building and who cannot legally remove them.

Direct Physical loss

A loss that is physical (not just financially) and results immediately from the occurrence.

Burden of Proof

In a trial, the duty of a party to prove that the facts it claims are true.

Friendly Fire

A fire that stays in it's intended place, such as a fire in a fireplace

Hostile Fire

A fire that leaves it's intended place, such as a spark that escapes a fireplace and sets the carpet on fire

Vandalism

Willful and malicious damage to or destruction of property.

Collapse

An abrupt falling down or caving in of a building with the result that the building or any part of the building cannot be occupied for it's intended use.

Moral Hazard

A condition that increases the likelihood that a person will intentionally cause or exaggerate a loss.

Morale Hazard

A condition of carelessness or indifference that increases the frequency or severity of loss.

Concurrent Causation ( concurrent causation doctrine)

A legal doctrine stating that if a loss can be attributed to two or more independent concurrent causation

Functional Valuation approach

A valuation method in which the insurer is required to pay no more thant the cost to repair or replace the damaged or destroyed property with property that is it’s functional equivalent . used on older buildings