Liability, Damages, Subrogation and Other Insurance
Liability terms test absolute, strict, vicarious, negligence, damages, limits, other insurance, primary, excess, pro rata, arbitration, and subrogation.
How to study claims adjusting
Treat each item as a claim file: verify coverage, document facts, value the loss, preserve defenses, and apply state adjuster duties.
Core concepts
Concept 1
Liability investigation connects duty, facts, coverage, limits, damages, and legal defenses.
Exam cue: Classify the liability theory before selecting the settlement approach.
Concept 2
Other insurance provisions determine whether a policy pays primary, excess, pro rata, or not at all.
Exam cue: For multiple policies, identify primary, excess, and pro rata wording.
Concept 3
Subrogation preserves recovery rights after payment and should not be waived casually.
Exam cue: For subrogation, ask whether payment has occurred and rights are preserved.
Risk pitfalls and guardrails
Assuming all liability requires negligence.
Guardrail: Avoid answers that waive defenses, skip proof, ignore valuation wording, or use one state's claim rule everywhere.
Ignoring policy limits while valuing damages.
Guardrail: Avoid answers that waive defenses, skip proof, ignore valuation wording, or use one state's claim rule everywhere.
Waiving subrogation without authority.
Guardrail: Avoid answers that waive defenses, skip proof, ignore valuation wording, or use one state's claim rule everywhere.
Memory anchors
Absolute Liability
Absolute liability can apply without proving ordinary negligence.
Strict Liability
Strict liability imposes responsibility without proving fault in specified situations.
Vicarious Liability
Vicarious liability holds one party responsible for another's acts.
Negligence
Negligence is failure to use reasonable care.
Damages
Damages are monetary compensation or punishment for loss or injury.
Limits of Liability
Limits of liability cap policy payment.
Primary Insurance
Primary insurance pays before excess coverage.
Excess Insurance
Excess insurance pays after underlying coverage is exhausted.
Pro Rata
Pro rata other insurance shares loss by a stated proportion.
Subrogation
Subrogation lets the insurer pursue recovery from a responsible party after payment.
Checkpoint rule
Do the check-up only after you can summarize each concept in one sentence and identify one dangerous pitfall from memory.
Knowledge Check (after reading)
Short check-up to confirm understanding of this module.
Check-up Questions
Which four elements must generally be shown to establish negligence?
How does contributory negligence differ from comparative negligence?
Answer all questions to submit.
Next step personalized recommendations
Continue learning
Move forward only after this module is stable.
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