Casualty Basics (Insurance) & Homeowner's Policies

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CASUALTY (LIABILITY) INSURANCE

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-anything that's not property insurance

-3rd party

-someone not directly involved in contract, but could benefit

-3rd party=1st party becomes liable due to bodily injury or damage to 3rd party property

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DUTY TO DEFEND

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insurer is obligated to provide defense to insured with claims under liability (when lawsuit stemming from loss that has potential for liability coverage)

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TORTS

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Civil actions, insurance companies will pay for many (who who commits civil action=tortfeasor)

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NEGLIGENCE

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-failure to act or not act in reasonable manner

-leads to another party's damages (4 MUST BE PRESENT:

1. legal duty owed (stop at red light)

2. breach of duty (action/inaction-run red light)

3. breach of duty was direct cause (hurt someone)

4. actual damages (injuries to other person)

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CONTRIBUTORY NEGLIGENCE

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defense when injured party was even slightly responsible (maybe pay nothing)

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COMPARATIVE NEGLIGENCE

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defense where one party's fault is weighted against the other party (if harmed party 30% responsible, other party pays 70%)

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ABSOLUTE LIABILITY

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inherently dangerous activities (exotic animals, swimming pools)-do not have to meet elements of negligence to be held liable

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STRICT LIABILITY

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faulty products

-manufacturer must provide warning or label if possibility of harm

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VICARIOUS LIABILITY

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person/entity not done anything wrong, but someone/something they are responsible for does (parents/minor children, owners/animals, employers/employees)

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COMPENSATORY DAMAGES

(2 types)

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make things right ($) after responsible for bodily injury or property damage