Exam 23: Managing Risk

A carton of eggs broke onto the floor in the dairy section,making the floor slippery.Little Johnny slipped,fell,and hit his head on the floor,causing a cut and mild concussion.The grocery store incurs _________________ liability for his injuries.

Doug's BOP on his fishing guide business excludes property losses due to the wakes of other fishing boats.This example illustrated the ____ approach to property insurance.

Match the term with its definition.Some terms may not be used. a.Actual cash value b.Aggregate stop loss limit c.Direct loss d.Disability buyout insurance e.Disability insurance f.Indirect loss g.Loss avoidance h.Loss prevention i.Loss reduction j.Replacement value of property k.Specific stop loss limit -A loss in which physical damage to property reduces its value to the property owner

Match the term with its definition.Some terms may not be used. a.Automobile insurance b.Coinsurance clause c.Crime insurance d.Design defect e.Manufacturing defect f.Marketing defect g.Noneconomic damages h.Partially self-funded program i.Proximate cause j.Punitive damages k.Workers' compensation legislation -A defect resulting from a dangerous design,even though the product was made according to specifications

A managed-care network providing health insurance that is more expensive than an HMO but offers a broader choice of medical providers is called a

The cost to replace or replicate property at today's prices is described by________.

After explaining the different types of property and losses,which ones were an issue for Sandy Whann,owner of Leidenheimer Baking Company?

Dan bought a $500,000 marina two years ago and obtained $400,000 of property insurance.Recently economic improvements on the lake has raised the property's value to $550,000 (the good news).But the general store had a fire causing $100,000 worth of damage (the bad news).How much will the insurance company pay to repair the store since Dan has a coinsurance clause in the marina's policy?

Which risk type directly affects the employee but indirectly impact the business?

Match the term with its definition.Some terms may not be used. a.Actual cash value b.Aggregate stop loss limit c.Direct loss d.Disability buyout insurance e.Disability insurance f.Indirect loss g.Loss avoidance h.Loss prevention i.Loss reduction j.Replacement value of property k.Specific stop loss limit -Lessening the frequency,severity,or unpredictability of potential losses

Match the term with its definition.Some terms may not be used. a.All-risk approach b.Business risk c.Compensatory damages d.Disability insurance e.Economic damages f.Health maintenance organization g.Market risk h.Named-peril approach i.Peril j.Preferred provider organization k.Pure risk -A managed-care network providing health insurance that is less expensive but more limiting in choices of medical providers

Real property risks include damage to buildings.

Loss reduction is defined as preventing losses from ever happening.

Match the term with its definition.Some terms may not be used. a.Automobile insurance b.Coinsurance clause c.Crime insurance d.Design defect e.Manufacturing defect f.Marketing defect g.Noneconomic damages h.Partially self-funded program i.Proximate cause j.Punitive damages k.Workers' compensation legislation -A defect resulting from failure to convey to the user that hazards are associated with a product or to provide adequate instructions on safe product use

Match the term with its definition.Some terms may not be used. a.Actual cash value b.Aggregate stop loss limit c.Direct loss d.Disability buyout insurance e.Disability insurance f.Indirect loss g.Loss avoidance h.Loss prevention i.Loss reduction j.Replacement value of property k.Specific stop loss limit -Insurance that provides a healthy partner the cash to buy out a partner who becomes ill

Driving as safely as possible is an example of loss

A lease on a real property structure will relieve the lessee of any damage or loss to the leased premises.

Match the term with its definition.Some terms may not be used. a.Business interruption insurance b.Business owner's policy c.Commercial general liability insurance d.Disability insurance e.Funds transfer fraud f.Key-person life insurance g.Package policy h.Personnel risks i.Proximate cause j.Reasonable standard k.Workers' compensation insurance -The criminal transfer of funds from a bank account

Assume a contract exists between Mr.Jones,a college professor,and his student,Mr.Smith.Jones provides a syllabus,instruction,tutoring,and assessments of learning but Smith fails the class.Which of the following elements is absent in this case?

Match the term with its definition.Some terms may not be used. a.Business interruption insurance b.Business owner's policy c.Commercial general liability insurance d.Disability insurance e.Funds transfer fraud f.Key-person life insurance g.Package policy h.Personnel risks i.Proximate cause j.Reasonable standard k.Workers' compensation insurance -A policy for small businesses that do not qualify for a BOP that combines property insurance,commercial general lability insurance,and crime insurance