• a two-party contract between the insured (first party) and the insurer (second party).
• referred to as first-party insurance, as it covers loss to property owned by the insured

• Insurer Cancels
• unearned premium is the premium refunded to the insured for the number of days coverage was not in place.

• cancellation of insurance that incurs a financial penalty.
• insurer retains a portion of the unearned premium to cover costs

• The primary cause of loss
• first event in the unbroken chain of events that resulted in loss

•  causes it to damage or destroy itself
• Rust rot fading paint
• NOT covered by property policy

• A legal agreement issued by an insurance company or a producer that provides temporary proof of insurance
• Max 60 days

• perils simultaneously cause a loss
• insurer must pay the loss even if one of the perils is excluded

• The existence of two or more policies covering the same exposures
• having the same policy periods
• same coverage triggers

• The existence of two or more policies covering the same exposures
• don’t have the same policy periods
• may create a coverage gap when underlying liability policies and an umbrella policy are non-concurrent

• Direct Loss
• Indirect Loss or Consequential Loss

• A loss that is not the direct result of a peril.
• Can't have thos W/O direct loss

• The cost to replace property with property of like kind and quality, at current pricing
• without a deduction for depreciation

• The cost to repair or replace property at its replacement value, minus depreciation.
• Vaule-Depreciation=ACV

• cost to replace property with other property that performs the same function with similar efficiency
• property is not identical

• exterior walls of masonry or fire-resistive rated for not less than one hour
• combustible floors and roofs

• buildings and its walls, floors, and structural framework are constructed of noncombustible materials.

• Buildings with exterior walls of masonry or
• made of fire-resistive construction with a rating of not less than one hour
•  noncombustible floors and roofs

• entire building and roof are constructed of reinforced concrete and steel
• 2-hour fire resistive rating

• walls, floors, and roof of a structure must have a fire resistive rating of at least 1 hour
• but less than 2 hours

• Specific Limit
• Scheduled Limit
• Blanket Limit

• Insures a single item of property for a single limit of insurance

ONE item ONE policy

• Insures one or more items of property on a single policy and the amount of insurance applying to each item is shown on a schedule

2+ items ONE policy

• Insures property located at more than one location
• more than one type of property at the same location
• OR both

• Declarations
• Isuring Agreement
• Conditions
• Exclusions

DICE

• Who- insurer/insured
• What- property being insured
• Where- location and address
• When- Effictive & expiration dates
• How much- Limits of liability & annual premiums

• States what perils are covered

• broadens coverage with no increase in premium
• No endorsement needed

• Subrogation allows the insurer to recover from the party that caused a loss
• Prevents the insured from collecting twice
• Helps the insurer control expenses and premiums
• holds the responsible third party accountable

obligations of the insured:

• written notice to the insurer(How When & Where)
• Notifying the police if a theft occurred
• Cooperating with the insurer in the investigation
• Protecting property from further damage
• Preparing an inventory
• Allowing: inspect on any damaged property and examine books and records.
• Submitting proof of loss (Tine & Cause, other insurance, evidence & recipts)

• Ordinance or law
• Earth movement
• War
• Utility OFF-premises
• nuclear hazard
• Gov Action
• Fungus wet rot dry rot bacteria
• neglected
• intentional loss

•  automatically included in property policies without an additional premium
• paid in addition to those stated in the insuring agreement
• Examples:

debris removal, collapse, and fire department service charges

• Named insured
• Insured
• First Named insured
• Additional Insured

• Person/Organization designated on Dec page
• Broadest coverage

• person or organization protected by an insurance contract

• Person or organization whose name appears first on dec page
• Can cancel the policy
• Responsable for paying PREMIUM

• Person or organization not normally protected
• Added endorsment provides protection

$10,000

First, determine the amount of coverage there should have been ($300,000 x .8 = $240,000). Divide what was insured by what should have been ($200,000/240,000 = 5/6) times the amount of loss ($12,000) = $10,000.