640 Class 2 Outline

640 Class 2 Outline - Class 2 Outline Business Finance 640...

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Class 2 Outline Business Finance 640 - Insurance and Risk Winter Quarter, 2008 This class focuses on several important legal principles that are reflected in insurance contracts. We review the principles of indemnity, insurable interest, subrogation, and utmost good faith. These principles are important in understanding individual insurance contracts discussed later in the course. We begin by reviewing the risk management process and loss exposures, topics covered in Chapter 3. I. Definition of Risk Management and Loss Exposure Risk management is defined as a systematic process for the identification and evaluation of pure loss exposures faced by an organization or individual and for the selection and administration of the most appropriate technique for treating such exposures. A loss exposure is a set of circumstances that presents the possibility of loss, whether or not a loss actually occurs. II. Types of Loss Exposures A. Property 1. Building, plant, other structures 2. Furniture, equipment, supplies 3. Inventory 4. Computers, computer software, data 5. Accounts receivables, valuable papers and records 6. Company vehicles, planes, boats , mobile equipment B. Liability 1. Defective products 2. Environmental 3. Discrimination, wrongful termination, sexual harassment 4. Premises and general liability (operations, completed operations, contractual liability) 5. Liability arising from company vehicles 6. Misuse of e-mail and internet 7. Directors and officers liability C. Business Income 1. Loss of income from a covered loss 2. Continuing expenses after the loss 3. Extra expenses to maintain operations following the loss 4. Contingent business income losses D. Human Resources 1. Death or disability of key employees
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640 Class 2 Outline - Class 2 Outline Business Finance 640...

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