CPCU 551, Chapter 8 Exam: Inland Marine Insurance Questions and Answers, Exams of Commercial Law

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CPCU 551, CHAPTER 8 EXAM

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Nationwide Marine definition - ANSWERStatement of the types of property that may be insured on inland marine and ocean marine insurance forms Nonfiled classes (uncontrolled classes) - ANSWERThe classes of inland marine business for which neither policy forms not rates must be filed with the state insurance department Filed classes (controlled classes) - ANSWERThe classes of inland marine business for which policy forms and/or rates must be filed with the state insurance department Floater - ANSWERA policy designed to cover property that floats or moves from location to location Invoice value - ANSWERA valuation basis that values covered property at its invoice value including freight Agreed value method - ANSWERA method of valuing property in which the insurer and the insured agree at the time the policy is written on the maximum amount that will be paid in the event of a total loss Shipper - ANSWERThe person or organization shipping goods, often the seller of the goods Consignee - ANSWERThe person or organization that receives property being transported by a carrier Common carriers - ANSWERAirlines railroads or trucking companies that furnish transportation to any member of the public seeking their offered services Contract carriers - ANSWERCarriers that furnish transportation services to shippers with whom they have contracts Act of God - ANSWERA natural and unavoiable catastrophe that interrupts the expected course of events Inherent vice - ANSWERA quality of or condition within a particular type of property that tends to make the property destroy itself...example eggs going bad if shipped without refrigeration Bill of lading - ANSWERA document acknowledging receipt of goods from the shipper, given by the carrier, which includes the terms of the contract of carriage for the goods.

Accumulation clause - ANSWERA clause in open cargo policies that double the policy limit when, for reasons beyond the control of the assured, shipments accumulate at some point in transit Trip transit policy - ANSWERPolicy that covers a particular shipment of goods specified in the policy Mail coverage policy - ANSWERForm that covers a financial institution against loss of securities and other negotiable instruments while in transit through specified types of mail Breakdown coverage - ANSWERCoverage in an EDP equipment floater for perils such as mechanical failure, electrical disturbance and damage to electronic data when covered equipment breaks down Installation floater - ANSWERPolicy that covers a contractors interest in building supplies or fixtures that the contractor has been hired to install Bailee - ANSWERThe party temporarily possessing the personal property in a bailment. Bailor - ANSWERThe owner of the personal property in a bailment Warehouse operators legal liability policy - ANSWERPolicy that covers warhouse operators against liability for damage to the property of others beings stored in operators warehouses Parcel post policy - ANSWERInland Marine policy that provides broad coverage on parcel post shipments Motor truck cargo liability policy - ANSWERPolicy that covers a trucker's liability form damage to cargo of others being transported by the trucker Owner's goods on owner's truck policy - ANSWERA type of motor truck cargo policy that covers any type of organization (not just a trucking company) for damage to its own cargo while being transported on its own trucks BMC 32 - Endorsement for Motor Common Carrier Policies of Insurance for Cargo Liability - ANSWERAn endorsement that insurers must attach to motor truck cargo liability policies of interstate carriers stating that the insurer will pay cargo claims for which the insured is liable, up to the limits required by the US Dept of Transportation, even if such claims are not covered under the policy Equipment floaters - ANSWERA category of inland marine policies covering various types of equipment, wherever it may be located for the policy period Contractors equipment floater - ANSWERA policy that covers mobile equipment or tools while located anywhere in the coverage territory

Upgraded value - ANSWERThe cost to replace covered equipment with the latest comparable state-of-the-art equipment available; can be used as a valuation basis in an EDP floater Bailee's customers policy - ANSWERA policy that covers damage to customers goods while in the possession of the insured, regardless of whether the insured is legally liabile for the damage Pattern and die floater - ANSWERA policy that covers the insured's patterns and dies while located at the premise of others and also while in transit to and from those premises A common carrier delivery service delivered a shipment of furniture to a retailer who sells household furnishings. The furniture was sold to the retailer by a furniture manufacturer on terms of Free On Board (FOB) Destination. When the retailer's receiving department began placing arm chairs into its back room, they discover tears in some of the chair arms that occurred during shipping. These chairs have been shipped in the same way previously without incident. At the time of loss and damage the chairs were - ANSWEROwned by the furniture manufacturer who can hold the delivery service liable for the cost to repair or replace them. An architectural firm has requested coverage for its vast library of valuable records of blue prints, drawings, and other documents. Their insurance agent has told them that they can provide coverage for the documents with a - ANSWERThey can provide coverage for the documents with a filed inland marine policy that includes some coverage restrictions. During an insurance renewal meeting, the insurance agent mentioned to the insured that they have a nonfiled electronic data processing policy form. Which one of the following describes the difference between a filed and a nonfiled policy form? - ANSWERNonfiled policies do not file forms or rates with state insurance departments but for filed polices both are filed. Processing floater - ANSWERA policy that covers the insureds goods while being worked on a subcontractor's or processors premises and while in transit to and from those premises Dealers policy - ANSWERA policy that covers the inventory and other property or any of the types of dealers that qualify for inland marine coverage such as jewelers equipment dealers, fine arts dealers and furriers. Block policy - ANSWERA dealers policy particularly one written for a jeweler or a furrier Signs coverage form - ANSWERForm that covers neon, fluorescent, automatic or mechanical signs