Umbrella Insurance

Table of Contents

Chapter 1:  What is Umbrella Insurance	1
Umbrella Policy Questions	1
Umbrella Insurance Defined	1
Liability Dollars Figures	1
Price Variance	2
Chapter 2:      How Does Umbrella Insurance Fit in with General Liability Claims	3
Liability Insurance for Liability Exposures	3
Torts	3
Intentional Torts	4
Intentional Interference with the Person	4
Battery	4
Assault	5
Mental Distress	5
Defamation	6
Defamation or Slander on social media	6
False Imprisonment	8
Intentional Interference with Property	8
Trespass	8
Conversion	8
Privilege	9
Mistakes	9
Consent	9
Protective Acts	10
Absolute Liability	10
Strict Liability	11
Negligence	11
A Reasonable Man	11
Chapter 3:  When is Umbrella Insurance Necessary	12
Third-Party Forms	12
General Liability Forms	12
Actual Claims Result from Negligence	13
Primary Underlying Policies	14
Terms:  Coverage & Liability	14
Legal Liability Must Exist	15
Public Opinion	15
Ownership & Liability	15
News Exposure	16
Paying for a Legal Defense	16
The Law of Negligence	16
Successful Liability Claims	16
Relaxed Standards for Evidence of Negligence	17
Daily Risks of Life	17
Dual Risk Contributions	17
Injury Avoidance	18
Shared Blame – Injured Party Preference	18
Absolute Liability	18
Determining Monetary Damages	18
Jury Awards	18
Umbrella Liability Insurance	19
Excess Coverage	20
Chapter 4:  Umbrella Policy Considerations	21
Excess Liability Insurance	21
Excess in 3 Ways	21
Million Dollar Limits	22
An Indemnity Policy	22
Bumbershoot	23
Comprehensive Ceiling Coverage	23
Excess Personal Liability Coverage	23
Excess Liability versus Excess Coverage	24
Exclusions in Coverage	24
Legal Contracts	24
Offer & Acceptance	25
A Premium Must be Paid	25
Legal Competence	26
A Legal Reason	26
The Liability Policy	27
No Standard Form	27
Catastrophic Coverage	27
Primary Purpose	28
Characteristics of Personal Umbrella Policies	28
Policy Layout	30
Risk Management Field	32
Chapter 5:  Underwriting the Umbrella Policy	33
Assessing Policy Risks	33
Books of Business	33
Underwriting Based on Exposures & Risks	34
Adverse Selection	34
Risk Classification	34
Pricing Specific Contract Risks	35
Actuarial Equity	35
Subsidizing Rates	36
Exposure Distribution	36
Recognizing the Underwriters	36
The Agent as a Preliminary Underwriter	37
Staff Underwriters	37
Line Underwriters	38
Actual Underwriting Processes	38
Information:  The Agent’s Role	39
Information & the Inspection Company	40
Accepted or Rejected	41
Standard Risk Applicant	41
Preferred Risk Applicant	41
Substandard Risk Applicant	41
Post-Selection	42
Unique Aspects of Post-Selection	43
Retention	44
Line Limits	44
Underwriting & Production	44
Premium Rates	45
Chapter 6:  Agent Ethics	46
Everyone has a Code of Ethics	46
Determining Our Own Life Goals	46
Controlling Behavior	47
Defining Ethics	47
“Ethics” – from Ethos Meaning Character	48
Moral Excellence	48
Imitating Other’s Behavior	49
Religion & Ethics	49
Continually Learning	49
Behavior Examples:  Example 1	50
Example 2	51
Example 3	52
Example 4	53
Example 5	54
The Formation of Values	54
Four Basic Issues	55
Facing Ethical Issues Daily	56
Question #1 – Is It Possible to Teach Ethical Behavior?	56
Egoists (Not Eotists)	57
Ethical Egoism	58
Day-to-Day Heroism	59
Question #2 – What is the Scope of Ethics?	59
Question #3 – What Does it take to be a Moral Person	61
Believing in Right & Wrong	61
Religion – a Common Component	62
Addressing Three Questions	62
Competency	63
Understanding the “Why” of Your Profession	63
Who Do You Choose to Work for?	64
Example 1	64
Example 2	65
Example 3	66
Example 4	67
Back to the Question of “Why?”	67
Question #4 – What are Our Responsibilities to Other Moral Persons?	67
Reactions of Our Actions	68
Ethical Responsibility - a Matter of Daily Choices	68
Determining Identity	69
Objectivist Ethics	69
Thinking Individuals will always be the Top Performers	70
Objectivist Ethics as a Theory	70
What Does Ethics In Action Mean?	70
Man’s Nature	72
It’s Easier to Say it than it is to Actually Do It	74
Forming Who We Are	74
Standing Up for What We Believe	75
“Levels” of Ethics	76
Changing Our Views	77
A survey of CEO’s	77
Keeping Our Priorities in View	78
Psychology or Manipulation	79
Can Ethics be a Part of Promotional Selling?	81
Ethical Conduct is Hard Work	82
Sympathy or Empathy	82
Can Honesty Always Be Considered?	85
Repeating Mistakes Through Lack of Knowledge	86
Love Envieth Not	86
For Example:	86
Where Did the Dishonest Reputation for Salespeople Come From?	87
Implied Statements	87
Due Diligence	88
What Does Due Diligence Mean?	88
Agent Representation	89
Three Reasons to Practice Due Diligence	89
Gathering Company Information	90
Insurance Company Financial Statements	90
Assimilating the Information Gathered	91
Company Rating Services	91

United Insurance Educators, Inc.

PO Box 1030

Eatonville, WA  98328

www.uiece.com