Term
An analysis of the Insuring Agreement in most liability policies reveals the following:
(i) Insures bodily injury and property damage;
a) Define "bodily injury."
b) Define "property damage." |
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Definition
a) Bodily injury refers to physical injury sustained, and associated with external causes. Ex. a person who trips over loose carpeting or one who falls through defective stairs on the insured's premises and is injured is considered to have suffered a bodily injury.
** Bodily injury also includes injury caused by sickness or disease & death resulting from any such injury at a later date will be considered as part of the same bodily injury.
b) Property Damage - unintentional damage to the property of others is generally covered by their liability policy. Property damage includes:
Physical injury to tangible property as well as the resulting loss of use; it also includes the loss of use to tangible property that is not physically injured. |
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Term
An analysis of the Insuring Agreement in most liability policies reveals the following:
ii) Third Party Coverage only;
Define "Third Party." |
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Definition
The coverage provided by all liability policies is for damage or injury caused by the insureds to third parties.
A third party is anyone or any entity that is not named in the policy. |
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Term
An analysis of the Insuring Agreement in most liability policies reveals the following:
iii) Payment only when insured legally liable:
Who determines the matter of "legal liability?" |
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Definition
Although the insured may feel a moral obligation to the injured party, the policy will respond only when the insured is legally liable for the injury or damage caused. NEGLIGENCE MUST BE ESTABLISHED.
**Determination of legal liability is a matter for the courts. |
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Term
An analysis of the Insuring Agreement in most liability policies reveals the following:
iv) Coverage provided on an occurrence basis;
Define "Occurrence." |
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Definition
Liability policies insure bodily injury and property damage on an occurrence basis. This includes coverages for unexpected injury which happens suddenly or over long periods of time.
**"Occurrence is defined by the policy as an event" which occurs suddenly and unexpectedly; technically, a sudden and unusual event which can be fixed in time is an accident.
OR
*which occurs over a long period of time. |
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Term
An analysis of the Insuring Agreement in most liability policies reveals the following:
v) Pays compensatory damages only.
Explain the purpose of "compensatory damages." |
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Definition
Liability policies pay for compensatory damages only.
Compensatory damages are those which are intended to compensate the third party (plaintiff) for the injury or damage caused by insured (defendant). |
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Term
| State the duties owned by the insured to the insurer in the event of an occurrence, claim or action. |
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Definition
* Provide the insurer with prompt notification of any occurrence which may lead to a claim or action. (time, place, & circumstances, names & addresses of witnesses)
* Immediately provide the insurer with copies of any legal documents received.
* Authorize the insurer to obtain records and other information.
* Do not accept at their own cost, voluntarily make a payment, assume any obligation, or incur any expense, other than for first aid, without the consent of the insurer.
* |
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Term
The insurer agrees to make "Supplementary Payments."
i) What is the purpose of these payments?
ii) Identify four such payments. |
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Definition
i) Provide additional payments over and above the amount of the actual judgement.
ii) Costs of defense: legal costs, hiring independent adjuster, lawyer/defense, investigators |
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Term
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Definition
| Refers to damage to tangible property including all resulting loss of use. |
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Term
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Definition
| Means an accident, including continuous or repeated exposure to substantially the same general harmful conditions. |
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Term
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Definition
| Provide additional payments over and above the amount of the actual judgement. |
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Term
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Definition
| Includes sickness, disease and even death. |
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Term
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Definition
| A sudden and unusual event which is fixed in time. |
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