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AIC 303 Successfully Evaluating Liability Claims study guide solution
Consent to settle clause - An insurance policy provision, usually found only in professional liability policies, that requires the insurer to obtain consent from the insured before settling a claim. Statement - A written or recorded account or declaration of the pertinent facts and circumstances of an accident given by someone directly involved in or a witness to the accident. Internet of Things (IoT) - A network of objects that transmit data to computers Premises liability - The exposure to liability for bodily injury or property damage due to the ownership, occupancy, or use of the premises. Attractive nuisance - A dangerous object or condition so captivating to young children that it entices them onto another's property. Licensee - A person who has permission to enter onto another's property for his or her own purposes. Public invitee - A person invited to enter onto premises as a member of the general public for a purpose for which the land is open to the public. Business invitee - An individual who has express or implied permission to be on the premises of another for the purpose of doing business. Actual notice - Information that has been directly given to someone. Constructive notice - Knowledge that a person is assumed by law to have because that knowledge could be gained by reasonable observation or inspection.
Negligence per se - An act that is considered inherently negligent because of a violation of a law or an ordinance. Proximate cause - a cause that, in a natural and continuous sequence unbroken by any new and independent cause, produces n event and without which the event would not have happened. Medical payments coverage - Coverage that pays necessary medical expenses incurred within a specified period by a claimant (and in certain policies, by an insured) for a covered injury, regardless of whether the insured was at fault. Premises security liability - The civil liability of property owners for the foreseeable criminal acts of third parties. Products liability - A manufacturer's or seller's liability for harm suffered by a buyer, user, or bystander as a result of a product that has a dangerous manufacturing defect or design defect or that is not accompanied by a warning of an inherent hidden danger. Negligence - The failure to exercise the degree of care that a reasonable person in a similar situation would exercise to avoid harming others. Strict liability (absolute liability) - Liability imposed by a court or by a statute in the absence of fault when harm results from activities or conditions that are extremely dangerous, unnatural, ultrahazardous, extraordinary, abnormal, or inappropriate. Express warranty - An explicit statement about a product by the seller that the buyer or other user may rely on and that provides a remedy in the event the product does not perform as claimed. Implied warranty - An obligation that the courts impose on a seller to warrant certain facts about a product even though not expressly stated by the seller
Occurrence - An accident, including continuous or repeated exposure to substantially the same general harmful conditions. Drop-down coverage - Coverage provided by many umbrella liability policies for (1) claims not covered at all by the underlying policies and (2) claims that are not covered by an underlying policy only because the underlying policy's aggregate limits have been depleted. Excess liability policy - A policy that covers liability claims in excess of the limits of an underlying policy or a stated retention amount. Umbrella liability policy - A liability policy that provides excess coverage above underlying policies and may also provide coverage not available in the underlying policies, subject to a self-insured retention. Claims-made coverage trigger - The event that triggers coverage under a claims-made coverage form; the first making of a claim against any insured during either the policy period or an extended reporting period. Occurrence coverage trigger - The event that triggers coverage under an occurrence coverage form: injury or damage that occurs during the policy period. Extended reporting period (ERP) - An additional period (also called a "tail") following the expiration of a claims-made policy, during which the expired policy will cover claims first made for injury or damage that occurred on or after the policy's retroactive date (if any) and before policy expiration. Retroactive date - The date on or after which the injury, damage, or other insured event must occur in order to be covered in a claims-made liability policy Self-contained excess liability policy - An excess liability policy that is subject to its own provisions only and does not depend on the provisions of the underlying policies for determining the scope of its coverage.
Self-insured retention (SIR) - An amount specified in an insurance policy that the insured must pay before the insurer will make a payment for a claim. Dram shop act - A statute holding establishments that serve alcoholic beverages responsible for harm that results from serving patrons alcohol in violation of the statute. Sick building syndrome (SBS) - An illness caused by or an allergic reaction to chemicals in buildings attributed to a combination of building design, construction materials, maintenance, and fungal and biochemical factors. It results when sealed energy-conserving structures recycle contaminated air Multiple chemical synsitivity (MCS) - An ecological illness, often related to "sick buildings." It is triggered by allergies to synthetic fabrics, perfumes, plastics, solvents, and other pollutants, including high levels of formaldehyde in cabinets or synthetic carpets. Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) - Legislation that regulates the cleanup of hazardous waste sites. Alternatively referred to as Superfund. Superfund - A program established by the Comprehensive Environmental Response, Conpensation, and Liability Act (CERCLA) to study and remediate hazardous waste sites listed on the National Priority List (NPL). Rescue doctrine - A legal doctrine providing that a party causing an accident can be liable to any people involved in rescue efforts as a result of the accident. Joint tortfeasors - Two or more parties who act together to commit a tort or who commit separate torts that combine to cause an injury or loss. Joint and several liability - The liability of multiple defendants either collectively or individually for the entire amount of damages sought by the plaintiff regardless of their relative degree of responsibility.
Magnetic resonance imaging (MRI) - A diagnostic imaging tool that uses a superconductive magnet, electromagnetic waves, and a sphisticated computer system to create detailed images of the body's interior. Thermography - A diagnostic imaging procedure that measures the surface temperature of the skin, detecting injured areas. Damages - Money claimed by, or a monetary award to, a party who has suffered bodily injury or property damage for which another party is legally responsible. Compensatory damages - A payment awarded by a court to reimburse a victim for actual harm. Special damages - A form of compensatory damages that awards a sum of money for specific, identifiable expenses associated with the injured person's loss, such as medical expenses or lost wages. General damages - A monetary award to compensate a victim for losses, such as pain and suffering, that do not involve specific measurable expenses. Remittitur - This occurs when a judge uses his or her discretion to reduce an excessive jury verdict award. Additur - Occurs when a judge uses his or her discretion to increase a jury verdict award that is deemed insufficient. Collateral source rule - A legal doctrine that provides that the damages owed to a victim should not be reduced because the victim is entitled to recover money from other sources, such as an insurance policy.
Mitigation of damages - A duty owed by an injured party to a claim to take reasonable measures to minimize or avoid additional injury or loss. Hedonic damages (loss of enjoyment damages) - Damages associated with the loss of physical and intellectual gratification and other lifestyle losses. Loss of consortium - The loss of benefits that one spouse is entitled to receive from the other, including companionship, affection, and sexual relations resulting from the injury or death of a spouse. Decedent - The deceased claimant in a death claim. Estate - The sum total of all types of property owned by a person at the time of death, including businesses, profits, savings accounts, stocks, and other financial assests. Survival action - A legal cause of action that existed for the deceased before his or her death. Wrongful death action - A legal cause of action that exists for the survivor of the deceased Pecuniary loss - The monetary economic loss of the survivors. Household service - A service such as cooking or cleaning. Intrinsic value of children - The assumption that parents make rational financial decisions in having children, knowing that the investment in the expense of raising them will provide companionship and comfort as a return when the children are older. Best alternative to a negotiated settlement (BATNA) - The most that an insurer would pay for a loss after considering all the facts. The claims representative determines the highest probable award (as from a trial or arbitration), then adds the costs of the actions.
Offer - A promise that requires some action by the intended recipient to make an agreement Acceptance - The assent to an offer that occurs when the party to whom an offer has been made either agrees to the proposal or does what has been proposed. Release - A legally binding contract between the parties to a dispute that embodies their agreement, obligates each to fulfill the agreement, and releases both parties from further obligation to one another that relates to the dispute. Vicarious liability - A legal responsibility that occurs when one party is held liable for the actions of a subordinate or associate because of the relationship between the two parties. Covenant not to sue - An agreement that states that in exchange for a specified sum of money, the claimant will not sue one of the joint tortfeasors. Structured settlement - An agreement in settlement of a claim involving specific payments made over a period of time Minor - A person who has not attained the legal age (eighteen years old in most states). Parent-guardian release and indemnity agreement (PG release) - A special release that can be used to settle the claims fo the parents and the child in claims involving a relatively small dollar amount and little chance of a permanent injury. The parents agree to indemnify the insurer for any amounts paid as the result of the minor bringing action one he or she reaches legal age. Court-approved settlement - A legal proceeding in which the court reviews all details of the settlement, then determines whether it is in the best interest of the minor. If the court accepts the settlement, it issues a judgment approving the settlement terms and amount. This effectively releases the claims of a minor.
Tortfeasor - A person or an organization that has committed a tort. Hold-harmless agreement (or indemnity agreement) - A contractual provision that obligates one of the parties to assume the legal liability of another party. Subrogation - The process by which an insurer can, after it has paid a loss under the policy, recover the amount paid from any party (other than the insured) who caused the loss or is otherwise legally liable for the loss. Salvage - The process by which an insurer takes possession of damaged property for which it has paid a total loss and recovers a portion of the loss payment by selling the damaged property. Collateral sources - Nonliability insurance sources of recovery that reimburse claimants for all or some of their medical expenses, wage loss, or disability. Examples include healthcare insurance, no-fault auto insurance, and workers compensation.
