Lesson Summary

- Definition of Insurance: Insurance is a legal contract that provides financial protection to individuals or organizations against potential losses or damages. - How Insurance Works: Insurance works by pooling risk from multiple policyholders and using the premiums collected to pay for any losses or damages that may occur. - Characteristics of an Insurance Contract: Insurance contracts are legal agreements that have certain characteristics, including a principle of indemnity, insurable interest, utmost good faith, subrogation, and contribution. - Types of Insurers: There are various types of insurers, including stock insurers, mutual insurers, captive insurers, and government insurers. - Hazards and Risks: Hazards and risks are factors that can contribute to the occurrence of losses. Key terms related to hazards and risks include exposure, peril, loss, insurable risk, and risk management techniques. - Important Policy Terms: There are various policy terms that are important to understand, such as policy limits, deductibles, coinsurance, coverage exclusions, and endorsements. - Types of Hazards and Fraud: Hazards can be classified into four types: physical, moral, moral, and legal. Fraud in insurance can be classified into two categories: soft fraud and hard fraud. - Cause and Loss: The cause of a loss can be categorized as an occurrence or a proximate cause. Direct and indirect losses may occur as a result of an insured event. - Insurable Interest, Subrogation, and Claims: Insurable interest refers to the financial interest that a policyholder has in the insured property or person. Subrogation is the right of an insurance company to recover costs from a third party. Claims involve the process of investigating, evaluating, and settling insurance claims. - Valuation, Deductibles, and Coinsurance: Valuation refers to the process of determining the value of the insured property or belongings. Deductibles and coinsurance are types of cost sharing between the insured and the insurance company. - Liability Insurance and Policy Limits: Liability insurance provides coverage for legal liabilities resulting from negligence. Policy limits indicate the maximum amount that an insurance company will pay for a covered claim. - Liability and Law: Liability and law involve various types of laws used in civil court, duties of the insured and the insurer, civil damage types, and liability laws. - Agents and Authority: Insurance agents play a crucial role in selling insurance policies and serving as intermediaries between policyholders and insurance companies. They have specific responsibilities and authority granted by the insurance company. - What is Adjusting: Adjusting involves the process of evaluating, investigating, and settling insurance claims. There are different types of adjusters with specific responsibilities. - Settling the Claim: Settling a claim involves resolving the claim through various methods such as negotiation, alternative dispute resolution, or litigation. - Common Policy Provisions: Common policy provisions include standard fire policy, homeowners policy, dwelling policy, personal auto insurance, farm insurance, crop insurance, commercial property insurance, and commercial general liability. - Fiduciary Duty and Ethics for Adjusters: Adjusters have a fiduciary duty to act in the best interest of the insured. They face ethical challenges and must adhere to a code of ethics. - Insurance Rules and Regulations: Insurance is regulated by government authorities such as the Florida Office of Insurance Regulation and the Department of Financial Services. There are specific rules and regulations that insurers and insurance professionals must follow. - Insurance Fraud: Insurance fraud involves intentional deception or misrepresentation for financial gain. It is important to fight against insurance fraud to protect policyholders and the industry as a whole.