Aic 301 Assignment 1, 2 And 3 Study Guide Questions And Correct Answers

Mitigation of damages {Ans: A duty owed by an injured party to a claim to take reasonable measures to minimize or avoid additional injury or loss.}Extracontractual damages {Ans: A payment awarded by a court that exceeds the usual contract damages for a breach of contract.}Which one of the following is the most appropriate alternative for an insurer whose insured has been sued by a third party and a question of coverage has arisen under the insured's policy? {Ans: Investigate or defend under a reservation of rights or nonwaiver agreement allows the insurer to conduct an investigation into the coverage issue without waiving any of its rights to deny coverage. Refusing defense or denying the insured's claim in this situation could result in severe adverse consequences to the insurer, if the facts ultimately show that the insured is covered. Investigating without reservation of rights or nonwaiver would result in the insurer waiving its coverage defenses.}Voidable contract {Ans: A contract that one of the parties can reject (avoid) based on some circumstance surrounding its execution.}Estoppel is equitable in nature and {Ans: arises from a false representation. Waiver is contractual in nature and rests upon agreement between parties.}Tender