Transcript for:
Fundamentos del Seguro de Propiedad e Incendios

all right this is melissa the insurance exam queen and we have a three hour property and casualty class so let's go ahead and get started all right so let's just talk about insurance for a minute so what is what is what is insurance and why why do we get it so in life we have these risks you have the risk of crashing your car you have the risk of your house burning down you have the risk of getting sick you have the risk of of dying and leaving your family with no money we have a lot of risks in life and there's many ways that we can handle you know our risk you can um in fact you are a star at handling risk you can share the risk with someone else like if you get married the two of you are now sharing the risk of paying the bills of having a house of raising children you can avoid the risk you could say you know what i'm not even going to buy a car so i don't crash it i'm not going to leave the house so i don't get sick i'm not going to get on an airplane so that it won't crash you um that would be avoiding the risk but avoiding is almost impossible um you could retain the risk which means that you keep it so retaining means i keep the risk and i deal with it myself so if my car is destroyed and i have no insurance i would pay for it myself my house burns out i pay for it myself so retention is keeping the risk um or you could uh reduce the risk you could try to do things that make make the risk less risky so if i'm always cleaning my gutters i'm keeping my car maintained um whatever or or i'm wearing a mask i'm washing my hands i'm exercising so that i stay healthy you can reduce the chance of a risk but the best way of handling risk is to transfer it so again i'm kind of um it should be on the document oh wait another wrong screen um i don't think i have star on this page but um star is the way oh there it is right there handling risk so see how it says handling risk sharing transfer avoidance retention reduction you want to know i am a star at handling risk i can share the risk i could transfer the risk which we haven't talked about yet i could avoid it i could reduce it i can retain it you want to remember those share transfer avoid retain reduction i am a star at handling risk all the other ones sharing avoidance retention and reduction um are cool but the very best one is to actually transfer the risk how amazing is that that the risk of my house burning down the risk of crashing my car i can transfer it i can give it away to someone else and that's what insurance is insurance is the transfer of risk the risk of me having to pay for my car after it's destroyed in an accident i have given that to the insurance company they have it they own it it's not my problem that's what transfer is that's what insurance is so insurance is the transfer of risk insurance is the transfer of risk and anything that i'm repeating is definitely a testable point and something that i really want you to memorize so insurance is the transfer of risk now if you notice on the screen it says insurance is the trance of of risk of loss now they may trick you on the exam the answer is risk the very best answer what is insurance or or what is uh yeah what is insurance transfer of risk very best answer but if risk is not available you will choose loss as your second option because insurance is the transfer of risk of loss so insurance is a transfer of risk of loss and if they have a multiple choice every test question will be multiple choice but if they say what is insurance and or they'll say insurance is a transfer of and they'll have four options if one of them is risk choose it that's the right answer if one of them is not risk but one of them is loss you're going to choose loss so loss is the second best answer and the exam actually kind of does it a lot they will have a very good answer and then another answer that's kind of good so when you take the exam you're gonna see four questions two of them you can or four answer options two of them you can pretty much delete right away and then the other two um are choosing between the best answer and another answer so i will always try and focus and help you know what is the best possible answer when you're on the exam so insurance is a transfer of risk of loss choose risk first if risk is available only choose loss if risk is not available then you need to know the definition of risk so we talked about the risk is the car crashing the house burning down whatever but you also want to know the definition which is the uncertainty or chance of loss occurring so risk is the uncertainty or chance of loss occurring and i am transferring that to the insurance company and i'm letting them handle it i'm letting them take care of the bill in all of that now when it comes to handling risk i am a star at handling risk the re the retention one is where you're keeping the risk retaining the risk with retention you can either fully keep it and you be basically become self-insured so you're insuring yourself you're handling all the risk yourself but retention can also be a little bit and what i mean with that is that retention could be the deductible so for many of us if you have a car insurance policy if you crash your car and it's destroyed you're going to have to pay your deductible which is the first 500 or a thousand dollars of the risk you retained 500 of the risk via your deductible so when you think about the word retention also think about deductible because even on the umbrella policy the deductible on an umbrella policy is called a sir self-insured retention you are self-insuring at least a little bit so retention could be all of it or some of it if it's some of it it's the deductible that a retention is a deductible so when you buy insurance you're transferring the risk and if the risk were to occur you pay the deductible when it happens they take care of the rest up to the limit and risk is the uncertainty or chance of loss occurring now they're not going to cover every single risk do are they going to cover the risk of me going to las vegas and losing all my money no they will not there are only certain risks that insurance companies are willing to take and these risks are known as pure risks so pure risks are situations where either nothing happens or a bad thing happens i either crash my car or i don't i either get sick or i don't my house either burns down or it doesn't that is a pure risk either loss or nothing is the um pure risk okay and only a pure risk is insurable you cannot get insurance on something unless it is known as a pure risk either loss or nothing no chance of gain they like to define that one a few different ways you can you want to be prepared for saying that a pure risk is lost or nothing and you want to be prepared to say that a pure risk is no chance of gain they definitely can word it both ways or the same way i mean as in you could take one exam and one question will be what is a pure risk loss or nothing and then five questions later it'll say what is a pure risk and you're choosing no chance of gain that's what i mean by they're going to use both definitions and again only pure risks are insurable i cannot get insurance on a risk unless it's known as a pure risk loss or nothing no chance of gain and with the no chance of gain what we're saying is you're not going to make money your house either burns down or it doesn't there's no making money off of your house which ties into the other type of risk known as speculative risk a speculative risk is a lose or gain i might lose but i might win that is a speculative risk and that one is not insurable insurance companies will not cover you if you were a speculative risk would be like covering going to vegas and gambling so if you say well i'm going to go to las vegas and i've got a thousand dollars i'm gonna spend on gambling but in case i lose it i'm gonna buy insurance so that i'll always get my thousand dollars back insurance companies don't do that like because if you win you win and if you lose they pay out you don't lost you never lost anything that's not a real they can't cover that so speculative is lose or gain lose or win and it is not insurable and if they ask about speculative risk outside of the definition of lose or win they will ask what is speculative risk like and it's like gambling so get it's not even like it is like that's one of the speculative risks now there's other speculative risks but the main thing that they talk about is gambling so speculative is like gambling you could lose you could win and you cannot get insurance on a speculative risk okay and then again make sure you're asking questions if you have any questions um you can either put them in the chat oh hi angela hello i'm in here as you by the way it was the calendar was linked to your zoom i only realized that at the last minute i was like oh my god i gotta log in as angela okay anyway um okay so now uh so so we talked about insurance is the transfer of risk we talked about risk is the uncertainty or chance of loss occurring we talked about the two types of risk which is that they're pure risk loss or nothing no chance of gain and then we talked about speculative which is lose or win lose or gain it's leg gambling and they will not insure it and of course we talked about handling risk that you can either share it you can transfer it you can avoid it you can reduce it and you can retain it and it's more important to know star and the acronym more than it is to know the exact definition of sharing the exact definition of avoidance the exact definition of reduction you don't need to know that because most of the time the question will be all of the following are ways to handle risk except and so you end up looking for the wrong answer because while it's sharing transfer avoidance retention reduction if it ain't one of those that's my correct answer with the accept questions okay now moving on to the next section we got exposure here um exposure is it and it's not on every exam if you haven't seen the word exposure in your studies that's fine but exposure is just basically asking how risky are you because if insurance is the transfer of risk the insurance company is going to take that risk from us they need to know how much risk and how risky is it if you are a bad driver if you have multiple speeding tickets and you have accidents you are way riskier than someone who has a good clean driving record so someone who is more risky will pay more premium than someone who is less risky and exposure is simply the way to figure that out so exposure is basically just asking how risky are you and depending upon that that will determine your premium so insurance is a transfer of risk and the more risk i have the riskier i am the higher my premium will be now um then we have hazards now a lot of people will confuse risks and hazards risk is the uncertainty of loss hazard increases the chance of a loss so a risk is the uncertainty of a loss hazard increases the chance of a loss one more time risk is the uncertainty of a loss hazard increases the chance of a loss okay so a hazard makes a risk riskier that's basically and that's why people get them confused because hazards and risk are you know they sound similar this is being recorded yes and every single person who bought a ticket will get a copy of that recording and i will also include the links of the notes and i will be emailing this out within 24 to 48 hours it just depends on how quickly the computer converts the zoom meeting but at the latest about 48 hours to get a copy of this recording and then if you already have my all access package this recording will be added to as well um but you have the opportunity live so make sure you use that ability um barb did you have a question i do so you talking about the hazards and the exposures made me remember a question that's on the michigan exam good so the question is you run off the road and you're while you're driving and you hit a tree it's hitting the tree um a peril exposure or a hazard and i can't remember the fourth one wait it could be peril and the way that they're saying it so hitting well apparel is the thing that happens like the accident like crashing um but when we think about perils we think of fire lightning wind hail stuff like that but that i would choose peril for that one because the you crashed your car that's what is going to cause you to file a claim and the peril is the thing that happens the fire the lightning the wind the crash that makes you need to file a claim so in that instance if they say you're driving on the road um now it's weird because it is it raining in the question no and the question is i think the exact word is what is the act of hitting the tree and then it says is it apparel is it a hazard or is it an exposure i think i put peril i would choose pyrrole for that one i'm feeling weird about it but not a common question um i have seen that in a future some people will get a question about the tires um and tires are not covered by insurance they're more like a wear and tear kind of thing like like um insurance doesn't pay for a broken down car tires kind of are in this weird spot where they're not really covered by insurance in that way so sometimes you get a weird question like that um but i would go with peril for that one with hitting the tree thank you barb and again if anybody else has a question that they've seen from the exam share it so that way we you know can help everybody listen quick question to clarification since you mentioned the tires so since the tires can't be covered then does that does that mean it can't be a hazard the tires can't be a hat if you have bald tires okay just it can be okay just want to make sure even though if it's covered or not under insurance it still can be a hazard yeah hazards is anything that increases the chance of a risk and you you can have a risk that's also not covered like um if you don't have the coverage on your policy you don't have that but that could still happen to you right like something can happen to you even though it's not covered so and perils you can have apparel doesn't mean it is covered apparel just means it's a thing that can happen to you and your policy may or may not cover that peril if that makes sense okay now we're about to talk about peril here in a minute um well let's talk about peril that's fine so peril is the cause of loss it's the reason that you're filing a claim it's the event or the activity that occurs that um causes you to file a claim so it's the fire the lightning the wind the hail it's the wharves it's the um bbb ice golf those are all perils and your policy may or may not cover every single peril okay but peril is the cause of loss they always in the general insurance chapter when they talk about perils they almost always go with fire and hail those are the two main perils they'd love to talk about from the general insurance chapter but since you guys are taking the pnc you're going to be learning many perils way more than life and health so if any of you plan to take the life and health exam later or as well pnc is the harder one just so you know so if you're heading into life and health so much easier i actually have way more pnc customers than i have life in health like pnc is 80 of my customer base only twenty percent of his life and health reporting my youtube stats so that also shows you how difficult the pnc exam is all right i think i saw another question in there um wet leaves on the sidewalk is this a risk a hazard a pair i would go with the hazard on that one because the the peril would have to be an act the peril would be slipping on the leaves the apparel would be the actual thing that happens but wet leaves are are that's like that's like kind of like a tree branch sticking out of the sidewalk it's possible that you can interact with it and be in a riskier situation so i would go with um wet leaves on the sidewalk i would go with hazard on that one okay so peril is the cause of loss like fire or hail and then loss is the reduction or disappearance of value that's how they love to talk about loss the reduction or disappearance of value so you have a risk you transfer the risk to the insurance company you have apparel happen like your house burning down fire you that now your house has a loss it has reduced in value value has disappeared from the house because it burned away it's gone and that's what you filed the claim for is the the loss that's why the transfer of rent or the insurance is known as the transfer of risk of loss i'm not actually transferring the fire to them they can't stop me from getting sick but they can pay the bill for it so when we say we're transferring risk to the insurance company we're transferring the risk of having to pay the bill and we let them pay the bill and the bill is the loss what did i lose that i now have to fix so insurance is a transfer of risk of loss loss being that reduction or disappearance of value and peril is the cause of loss the reason why i'm filing a claim all right so now let's get into well we kind of already did hazards a little bit but so hazards is the increase um increase the chance of loss so a hazard will increase the chance of a loss it will increase the chance of the risk happening and then you so you want to know that definition a hazard increases the chance of a loss then you need to know the three types of perils there is a hazard sorry physical moral and morale physical moral and morale a physical hazard is is something that you can see and touch it's material it's structural i can see it i can touch it that is a physical um hazard or it's like um it's like a sidewalk that or a stairwell and you could see that the railing is rickety that the railing is shaky that's not very sturdy that is a physical hazard a rickety rail along a staircase is a physical hazard gas cans next to rags in the garage that is a physical hazard that can start a fire so physical hazards are things that you can see and touch and the fancy way that they describe that is material and structural so real quick yes okay so this is a question i've asked previously and it's kind of awesome because of what you're talking about at the moment but so i'm doing the pearson view test i've signed up for the personal lines but does that also include all the prosperity and casualty testing yes yes so just real quick property and casualty is home dwelling auto commercial personal lines is home dwelling and autumn so pnc versus personal lines is just including commercial personal alliance doesn't have anything commercial on it but what's really cool is the p and c exam if you only study personal lines for the pnc exam you're able to pass it that's all i focus on is actually teaching personal lines because that's really all you need to be able to even pass the pnc exam okay okay so i have this question a man buys an engagement ring for his fiance all of the following have an insurable risk except so insurable risk which i don't think we got to yet in our text but we will hear it somewhere along here an insurable risk is saying am i allowed to buy insurance on this can i buy insurance on this ring and the answer to that is well who owns the ring who has insurable interest in the rink you have to be tied to the ring financially to be able to insure it and then and or be a family or have business and business blood uh money that's what makes insurable risk okay so anyway the fiance um bank loan man purchasing the ring fourth i do not remember it's the one you don't remember so if if i buy a ring to propose to someone what that ring is mine and i own that ring i am definitely allowed to insure it if i asked a bank to give me a loan to insure this ring they they own it and i'm making payments and if i were to lose the ring the bank would want me to pay them back the loan regardless so they can get insurance on it too so the fiat the man purchasing the ring can definitely buy insurance on it he might hold on to it for a month or two before he actually proposes or whatever um so he would want to insure it during that time the bank if they gave a loan for it they could definitely insure it how how many of us have to have homeowners just because we have a mortgage or if you owe money on your car you the insurance the loan company wants to know that you have insurance and they even want to be added as as an additional insured on your policy i forgot to get water oh good um sorry i need to get something to drink i'm gonna i'm gonna ask the boo here where's your name grab me someone can you give me a can of sparkling soda out of the fridge downstairs okay now the man and then the man purchasing the right now the fiance she has insurable risk as well once she has the ring so once you own the ring now that now financially that is your ring and you can insure it and then as they get married as a couple they would have insurable risk on it as well but once he gives it to her it is hers and she would have financial ownership of it unless he's also still making loan payments on it um so it's probably the fourth option i don't because all of those work okay and that was on the new york exam okay cool okay perfect all right so physical hazards are things that i can see and touch then you have a moral hazard a moral hazard is lying on purpose so a moral hazard is lying on purpose this is where you know it's wrong but you're going to do it anyway the most common example of a moral hazard is lying on your insurance exam ah lying on your insurance application so as an insurance agent you're going to be filling out applications for people or they may be filling them out this is where i live this is what i drive this is what my house is et cetera et cetera um i'm sorry the doctor um you're gonna be filling out an application if you lie on that application that is moral hazard so moral hazard is lying and that's the most common example when they ask about a moral hazard is that you lied on your um insurance insurance application the last one is a morale hazard and as you know it's got a little extra e at the end a morale hazard this one when i think of morale i think of ee like teenagers because teenagers are moral hazard they are i don't care i do what i want this feels good yolo i do whatever that's a morale hazard now it's not i'm gonna cheat the insurance company those efforts it's more like i don't care if i crash my car insurance will pay for it so that's a morale hazard is the sense of carelessness it's more about an attitude and just not caring than it is someone trying to lie and be deceitful so more moral no e is about lying and being deceitful where morale is just i don't care i don't care yellow i only live once if i speed down the road because i love the wind in my hair and i happen to crash my car i don't care they'll fix it anyway so it's like a teenager i don't care if i mess up mom will clean it up anyway so that's the morale hazard is a sense of carelessness now there's usually a tricky question where they will say um let's smoke and drink which would be a physical hazard smoking and drinking are a physical hazard to your body it increases the chance that you get sick it increases the chance that you die sooner so smoking and drinking are physical hazards yes however they throw in a question that says let's smoke and drink because we're gonna die anyway that makes it a morale hazard so that sense of carelessness that attitude of that is a morale hazard i don't care whatever so morale hazard is a sense of carelessness so again you have your three physical health or you have your three hazards hazards increase the chance of a loss a physical hazard is one that you can see and touch a moral hazard is lying on purpose i lied on my insurance application i don't want them to know that i'm a very bad driver so i'm going to pretend that i have no speeding tickets i'm not going to list my accidents on there for them i'm going to lie to them and then a morale hazard is i just don't care they're going to take care of it whatever you deal with it i don't care i'm having a good time and by the way don't lie to insurance companies as you begin working for them you will see that they know everything about everything they have all the data on you they know every claim you've ever filed for every insurance company ever because they're all friends with each other okay can they want to protect they want to protect themselves against people who lie so they share information with each other about people who lie so don't ever lie to the insurance company they will find out okay now oh this is perfect for this how does how does insurance handle all of this so insurance when we if insurance is a transfer of risk so let's say i buy car insurance i pay a hundred dollars a month for my car insurance if i crash my car and cause an accident they could be paying me hundreds of thousands of dollars even millions of dollars depending on the coverage that i have how are they able to take 100 from me each month and be prepared to pay me potentially millions of dollars if i if i get into an accident and the reason they're able to do that is the law of large numbers the law of large numbers is basically endless amounts of data that insurance companies have to make predictions about things and the more data they have the better they can get at making predictions so they know if you tell them i'm a 35 year old woman with hypothyroidism that's me they will be able to predict the likelihood of when i will die and they will use that to determine my insurance rates like they have statistics on everything the likelihood of you crashing the likelihood of your car being stolen the likelihood of your house burning down they have all that data and they use it to make predictions how likely is this person going to get in an accident they use the law of large numbers and it will make the prediction for them about how likely you are to be in an accident now the law of large numbers is not asked about other than the definition so when they talk about the law of large numbers they want you to say the law of large numbers says the more information i have to look at the more data i have the more stats i have the more predictable losses will be so the more i have to look at the more predictable losses will be now with the law of large numbers yes they definitely ask about the law of large numbers but they always ask in the form of a definition what does the law of large numbers say the the more uh data i have the more predictable the loss will be that's how they word it or they will say what says the more data you have the more predictable losses will be and um law of large numbers becomes the answer so that's how insurance companies are able to take a hundred dollars from me and yet have a hundred thousand million dollars potentially pay out to me is because they know the data of the likelihood of me actually being in an accident and with insurance everyone is paying in and all of us have to have car insurance we're all buying car insurance we're all paying that hundred dollars a month whatever it is but only some of us will actually file a claim so it's very rare for every person ever to file a claim that hardly ever happens um and they exclude things that would cause that like war war is excluded they do not cover war on your insurance policy because if you have a war there's no statistics to predict about how much damage might be done they don't have that data because you can't make predictions about something that you don't even know could happen from some country whatever so war is excluded because i have no data on it um or flood flood is excluded from homeowners and dwelling policies and property policies because it impacts everybody and it's devastating so insurance the government had to take over flood insurance because insurance companies were not able to make a profit and that's the other mind-blowing thing too is with the law of large numbers insurance companies are able to only collect 100 from me only collect 100 from you have millions of dollars to pay out to us if we file the claims and still make a ton of money but that's crazy insurance companies know what they're doing and they use data all day long to figure it out and that's the law of large numbers okay where is my indemnity word all right we haven't talked about indemnity but i'm about to talk about reinsurance so i need to talk about indemnity first indemnity is probably at the end of the the notes anyway but indemnity is what the insurance company does for us so we transfer the risk to them that pure risk of our house burning down we transfer to them they will pay the bill when they pay the bill to fix our car and to rebuild our house they are indemnifying us they are making us whole again so if i had a three-bedroom two-bathroom house and it burns down and they rebuild me a three bedroom two bathroom house i have been restored i am restored to my previous financial condition of being a homeowner with three bedrooms and two two bathrooms so indemnity is to restore to put you back to where you were before so to indemnify someone means to make them whole to bring them back to where they were before now you're not supposed to make money off of insurance you're just supposed to be restored to where you were before insurance is not meant for you to profit off of now there are certainly times or situations where it can feel like that especially if you have life insurance and a person dies you get millions of dollars you're like whoa but what you're actually ensuring is the potential for that person to have made that millions of dollars um so it's not technically like a profit but it can certainly feel that way but indemnity is all about restoring making you whole again um not not making you profit not making you wealthy that's not necessarily the point of insurance especially with homeowners dwelling car insurance like that there certainly is insurance on the life on the life side like annuities that can help with making you wealthy um but but that's a whole different ballgame that we're not even dealing with right now so indemnity is to make us whole now going back to the idea where there are some things that are so big and so drastic that everyone is flying with claim at the same time that can happen and especially when you think of like a wildfire um if a wildfire breaks out burns down an entire you know community everyone's house is gone and destroyed or tornado you know there may come a time where the insurance company goes whoa too many claims all at once and what they can do to help prevent them from being in that situation is to have another insurance company back then and that's called reinsurance reinsurance is when one insurance company will back another insurance company for all or some of their losses but they don't say back they say indemnify because it means to make them whole again so let's say on state farm and there's like way more claims than we predicted because there's like all these natural disasters happening we're running out of money we're like oh my gosh we can't pay all these claims if i have another if i have another insurance company who's reinsuring me they're going to help me out they're going to take over some of the claims they're going to help pay the bill now i paid for that reinsurance isn't free it's not like oh we'll help you is that you pay us and we will we will help you when you when that happens so reinsurance is um when one company indemnifies another company it's just where what like i'll i'll scratch your back you scratch mine we'll take care of each other all right now with insurance companies um hey melissa can i ask you a quick question yes um i have so you know how indemnity how we were talking about and then we have replacement cost and i know replacement cost is used to calculate actual cash value but i was just wondering is there really a difference between the two yes and that's actually a good point because uh replacement cost defeats indemnity which could be a test question um and i actually talked about this in my most uh recent youtube video indemnity versus replacement versus um actual cash value so in depth so when i give the example of my house burns down and uh and then build it marita can you check your mute there we go i think she got it okay there we go okay i know she's that she's having audio issues i think anyway okay so uh replay okay so let's talk a little bit about replacement calls actual cash value and this is fine it's coming from the next section anyway all is good replacement cost is going and buying something brand new i like to call replacement costs best buy it's it's the money that i would need to go in and buy something brand new at today's prices that's replacement cost actual cash value on the other hand is the goodwill value the used value how much so so let's think about this for a second you you go to best buy you buy a brand new tv for a thousand dollars you take it home you hang it on your wall you use it for a year it's great but then next year you want to upgrade you want to get a bigger one you go to sell that tv how much are you gonna get for it a thousand hecks no no one is gonna pay you a thousand dollars for a tv that you've had for a year and you've taken it out of the box and you've used it you've touched it you got your fingerprints on it you wore down the remote control buttons no one's going to pay you a thousand dollars for that they're going to give you the goodwill value the used value replacement cost would be saying oh you know what we will give you the a thousand dollars for the tv that's not that's beyond indemnified you would be profiting in that way so if i do have a year old tv it burns the insurance company wants to give me the value of a one-year-old tv that's what i had they're restoring me to where i was before a person with a one-year-old tv it's it's been used it has wear and tear on it has cat hair on it it's been touched it's been used it's not brand new out of the box which is what replacement are in the box that's what replacement cost is brand new in the box so when they when they restore us with replacement costs they are actually allowing us to profit they are allowing us to make extra money but the thing is is or let's look at another example instead of the tv think about your car if you buy a car brand new sure you pay whatever you pay as soon as you drop off the law it's not worth that much the fact that there's now a title owner immediately devalues your car and as you drive around the value goes down further and further and let's say it's five years in that you own this car and you crash it they're not going to give you the same amount of money you use to buy that car they're going to give you what you could sell that car for right now and that's actual cash value is the used value of the car if they were to completely replace the car brand new again i am being put in a better financial position instead of being melissa with a five-year-old car i'm melissa with a brand new car i have been indemnified and then some because they're giving me back all the value and so replacement cost actually defeats indemnity now with most of your coverages everything is pretty much actual cash value your car is destroyed actual cash value your tv burns in a fire actual cash value the only thing that they really keep at replacement is um the walls and the roof because you can't rebuild a house with used wood they need to rebuild the house with brand new wood brand new roof tiles brand new siding brand new foundation right or whatever like they they can't build a house with used materials so replacement cost does defeat indemnity it's like the one time you are profiting off of insurance is when they rebuild you a brand new house because there's not really another option and that's where replacement cost defeats indemnity because you might be walking away like imagine if if you had a house built in the 1970s never updated never remodeled you try to sell it you know you might make you know 150 depending on the neighborhood whatever but if that house burns down and the insurance company rebuilds it and it's a brand new house all remodel all fresh stuff all brand new stuff you could sell it for maybe 250 300 even because it's all brand new but there's but the insurance can't build you a house from the 70s so you will benefit you will profit from replacement costs but there's no way around it but the thing is is like if i have a three-bedroom two-bathroom house and it burns down they're not going to rebuild me a 20-bedroom 10-bathroom house they're gonna rebuild me what i had before so they try to keep they try to keep it as close to what it was without having you profit too much but there's really no way to avoid that you know brand new house because it's just it is what's going to happen all right hopefully that for that i think you already said that cleared that up for you so awesome um perfect um okay all right so let's talk about um insurance companies so we're going to talk about stock companies versus mutual companies and also um insurance companies in general so in order for an insurance company and actually um let's do a little five minute break so we're on the five-minute mark so come back i don't know what time zone you're in come back at the 10-minute mark so take five minutes um this class is very short anyway so i don't want to give out too too long of breaks i'm gonna go get some water he hasn't got my text my dad must be keeping him very busy um he's making repairs all around the house is amazing having this man who actually knows how to do things but anyway um i'm gonna go with water be back at the 10-minute mark see you guys in a minute okay all right did i come back one yeah okay there i am yeah okay all right coming back up oh once you receive it um oh for the cash out angela sent her the you have the link you have the zoom link it's in your zoom so you can just center that that's fine but i haven't received anything yet okay i have one quick question yes i want to know how do i sign up for the 101 one-on-one with angela or me with you um i can send you the link okay i thank you yup and i can i'll share that at the end too yeah i'll shoot it at the end um don't let me forget but um i'll put it out there okay all right double checking everyone seems okay [Music] okay okay so well we're talking about insurance companies okay so insurance is a transfer of risk we've got our two types of risk pure risk loss or nothing speculative risk loser win we've got our hazards increase the chance of a loss we have our physical hazards things that we can see and touch we have our moral hazards which is lying on our insurance application we have our morale hazards with that little extra e and that's the sense of carelessness um we have our peril which is the cause of loss the reason that we file the claim um how are insurance companies able to do this with the law of large numbers they look at all the data to determine things um now we're going to talk about uh insurance companies specifically so when an insurance company wants to be an insurance company and sell insurance they have to go to the department of insurance in that state and say i want to sell here if the department of insurance says yes you can sell here they will give them what is known as a certificate of authority now what you want to remember about a certificate of authority is that it makes an insurance company admitted and authorized a certificate of authority makes an insurance company admitted a certificate of authority makes an insurance company authorized never certified i know it's got the word certificate in it and on the state exam they will say what does the certificate of authority mean and you will go certified now doesn't mean that it means admitted or authorized the certificate authority means admitted or authorized and then they may ask you what does admitted mean admitted means authorized what does authorized mean authorized means admitted so there's a kind of a weird thing that they've got with all of this but so a certificate of authority is what an insurance company needs to be allowed to sell so a certificate of authority is what an insurance company needs in order to be allowed to sell once they have a certificate of authority they are known as admitted and authorized and admitted is authorized authorized is admitted they love to ask this question you know what does an insurance company have to do before they are allowed to sell they have to get a certificate of authority and i kind of briefly um insurance is a state-run thing it's not president it's not congress it's not federal it's a state-run program so every state has their own department of insurance and the department of insurance is the ones who issues the certificates of authorities sometimes they ask you what is the certificate of authority like it's like an insurance license because you need to get an insurance license before you're allowed to sell an insurance company needs to get a certificate of authority before they are allowed to sell so it's similar to that and in fact i've seen that on the exam sometimes where they will say what is the certificate of authority similar to it's similar to an insurance license as an agent if i want to be allowed to sell i've got to have a license if they want to be allowed to sell they got to have a certificate of authority now insurance companies um there's many different setups for insurance companies and in your textbook you may read stock mutual franchise um there's a few other ones i forget but the two main ones are stock versus mutual so stock versus mutual so let's talk about mutual first so state farm is a mutual company and they're amazing i love state farm when you learn more about state farming like oh my god it's one of the greatest companies but anyway state farm is a mutual company and what that means is that people who buy the policy become members and as a member you own the company so in a mutual company you own the company you mutually own it with everyone else so anyone who is insured with state farm if you own state farm if you have a policy with them you are part owner of the company if you are in a mutual company now this is how cool state farm is when they collect the premium money that premium money is saved only for claims they don't take any money off of it they don't take any money off the top to pay themselves to pay for their um their employees they don't take any money from the other than commission but they take the premium money and they invest it and that's how state farm makes their money so like they're not even they're not even using premium money to fund themselves they're taking the premium money investing it and then they take it off the top but they leave the premium money just for claims and then what happens at the end of the year and so again so state farm uses the law of large numbers to make predictions about how many claims will be filed so they say okay looking at all the members the mutual people that we have insured we estimate that we will spend 20 million dollars in claims and so they collect enough premium to have 20 million dollars available for claims at the end of the year if there is still money left in the premium money bucket they will give it back to the people who paid the premium in so in a mutual company if if i own the company and i'm paying premium for my insurance and they end up not needing all of it because they maybe they anticipated a lot more claims than what actually happened they will give me the money back it's my money because i am a member i own this company so when there is leftover premium money that wasn't used for claims they give it back to the owners the people who paid the premium that is a mutual company and i don't know if she's still in here but um angela if you are join in one so that people can see how amazing you are with explaining stuff and why they should book appointments with you um but she explained stock versus mutual very well are you in your auntie she might not be in here i'll give her a second okay i'm gonna steal her line so she says that when you think of mutual it's me and you do you want to own your policy yes you do do you want to participate in your policy yes you do do you want to get back money if they didn't need it yes you do that is a mutual company so a mutual company is if you look at the text here on the screen mutual companies are owned by policy owners they issue participating policies and dividends are not taxed now the dividend is that money coming back so like i said there's extra money left over in the bucket at the end of the year that they thought they needed for claims and they didn't have to actually use it when they return it back to the mutual policy owners it's considered a return of unused premium as a dividend it's a dividend but it's considered a return of unused premium and then the government won't tax you on it because that was already your money so like if you you when when you get an income check so i get a check from work they've already taxed it and then i use that money to pay premium that money has already been taxed and if i get it back to me i shouldn't have to pay taxes on it again so you won't pay taxes when you get that money back so return of unused premium is is only if you're mutual companies because the people who pay the premium are the policy owners and if they're going to get any of that premium money back in the form of a dividend it's a return of unused premium so the dividends are not taxed in a mutual company and when they say issue participating policies that means that you as an owner are participating in the ownership of the company of the policy okay on the other hand you can have a stock company and stock companies are not owned by the policy owners they are owned by people who just bought a piece of the company in the stock or a share of the company unrelated to a policy so i can own a piece of an insurance company without owning a policy it's only in mutual companies where policy dictates ownership if it's not a mutual company your policy has nothing to do with owning the company it's only in mutual company mutual is all of us mutual means me and you it's a mutual feeling if you if you're in love with someone they love with you that's a mutual feeling we both feel the same thing we both own the same company i have a policy your policy we own it together we're mutually in this in a stock company there is no mutual nothings it is it is people who want to make money so they collect premium they and they estimate we're going to have 20 million in claims whatever they they have less claims any money left over in the premium bucket will go to the shareholders will go to the stockholders it will not go back to the people who paid it only the only way you can get your premium money back is if you're with the mutual company you will not get your money back if you are in a stock company and by the way you're not guaranteed to get your money back that's only if they have a surplus so if they estimate 20 million in claims and they end up having 30 million you're definitely not going to get a dividend because they're 10 million in the hole and they've got to use their own money to fix that hole so there's only a dividend if there is extra money left at the end of the year whatever their fiscal year is so whether you're stock or mutual an insurance company will use the law of large numbers to determine the premium that people should pay and then they save and store that premium for claims and then at the end of the year if there is money left over in a mutual company they will give those dividends back to the policy owners as a return of unused premium and they will not be taxed in a stock company they will give out the dividends to the shareholders and the stockholders who never paid premium so in a stock company when a shareholder gets a dividend that is money that is coming to them that is income to them it's money they never had before that now they have so in a stock company the owner the shareholder would have to pay taxes because that's money that they didn't have before it's money coming into them so please ask if you have any questions and barb is saying this has definitely showed up on her michigan exam understanding the difference between stock and mutual if you can just remember the bullet points you're good if you can remember mutual is owned by policy owners mutual issues participating policies mutual dividends are not taxed you can pretty much answer any question they have about mutual stock is owned by shareholders non-participating policies dividends are taxed if you can just remember those three things for each stock and mutual you're good for the example again please make sure you ask me any questions okay now um we want to talk about where insurance companies are located where are they based at insurance companies can either be domestic foreign or alien domestic foreign or alien and that in and of itself can be a question how can or what are the ways insurance companies can be documented as the word they use which dos domestic dos and missile just means you're home where where are insurance companies dos missiles domestic foreign and alien whatever word and it's usually an accept question insurance companies can be documented in all the ways except and you're looking for an answer that is not domestic foreign and alien because those are the ways that insurance company can be dasa messiah okay so what are the ways domestic is the insurance company started here headquartered here based here and selling here that's domestic so if i'm an insurance company and i get started in michigan i am founded in michigan i am based in michigan i am headquartered in michigan and if i sell in michigan i am domestic now i may branch out and sell in other states so if i'm a michigan company i started according to michigan laws and rules because any company you start in any state will have to follow those state laws so if i'm an insurance company that started in michigan i'm domestic to michigan because that is where i'm headquartered that is where i'm founded that is where my home base is at any other company that i try to sell in will be foreign because foreign says you're not headquartered here you're not based here you're not founded according to these state rules but you are selling here so foreign is where it's not my home base but i am selling here domestic is my home base and i'm selling here alien means completely outside the country i know many of us think foreign for that but you've got to shift your mind a little bit foreign is just another state that's not the home state so an insurance company if they're selling across all 50 states they're going to be domestic in one state and foreign in every other state an insurance company can only be domestic in one state because that is where they're dos missile that's where they're based off did you have a question i saw something on you for a second okay maybe not no i'm fine thank you no no reason all right and then so alien is is another country so our memory trick for domestic foreign and alien is if they have one state in the question so if the question says an insurance company is based in indiana and they're selling in indiana they only mentioned one state it's going to be domestic if they say an insurance company is based in wisconsin and is selling in new york they mention two states the answer is going to be foreign if they ask a question they say you're based in england or another country it's gonna be alien so domestic one state foreign two states alien country they're gonna use the word country you're out of the country you're in another country and they may not use the word country but they may actually say another country like if they say an insurance company is based out of spain what are they well spain is another country it's not america it's another country so it's going to be alien so you have domestic foreign alien domestic i'm i'm home here and i'm selling here i'm headquartered here i'm based here and i'm selling here domestic foreign i'm selling here but i'm home somewhere else i'm domestic somewhere else my headquarter is somewhere else alien complete that's an insurance company completely outside of the country all right all right now we're going to talk about you working for the insurance company so whether you work for stock mutual doesn't matter whatever that's cool as long as you know the three bullet points um when you work for a company you you fall under what is known as the law of agency now i'm going to tell you right now the definition that you see right here is not technically the definition of law of agency like this this right here that's not technically the definition of law of agency but let me explain myself law of agency explains the relationship between the insurance company and the agent so the company you're going to work for and you your relationship with each other is defined by the law agency so the law of agency defines the relationship between the insurance company and the agent who is selling their insurance now there are two main rules under the law of agency that are super crucial to memorize which are the two things that are on the screen that the um law that the agent represents the insurer so what that means is that you as the agent when you're working for state farm you are state farm to every customer that you meet you are state farm you represent the company that you work for you are a representative of them you are a you are a piece of them essentially so the agent represents the insurer the agent represents the insurer which also means that they are responsible for you and anything you do or say acting for them they ultimately are responsible for um you don't represent the customer that would be a broker a broker is someone who works for the customer they they find the customer's cheapest policy with any company or whatever it is you're looking for so a broker is not tied to a company they're tied to the customer where an agent is tied to the company now that that doesn't matter so much that you some of you may have questions about brokers on your exam not many of you do though but as an agent you represent the insurer you work for the other um number two rule to know about law of agency so remember law of agency defines the relationship between the insurance company and the agent the first biggest rule being that the agent represents the insurer the other rule is that knowledge of the agent is knowledge of the insurer and that's just a weird phrase you're like what knowledge of the agent is knowledge of the insurer huh all you need to do is memorize that knowledge of the agent is knowledge of the insurer because that's most of the exam questions will just be very focused on that being very definition based but what does that mean all it means is that when a customer calls you and you're like hi this is jake with state farm the customer is going to go oh jake with state farm anything that you tell me is state farm telling me that's all that is when you're talking to a customer to the customer you are the company and so everything that you say is knowledge of the insurer they believe and trust what you are saying because you work for the company so law of agency describes the relationship between the insurance company and the insurance agent and the two main rules to know are that the agent represents the insurer and that knowledge of the agent is knowledge of the insurer now what authority do you have as an insurance agent and angela really loves to switch these around so instead of saying agent authority authority of the agent and it helps with understanding that we're talking about what authority do i have as an agent what power do i have as an insurance agent there are three although one of them is not quite real it's known as perceived authority the first one is express authority what is what is express authority is whatever is written in my contract so when you go to work for an insurance company they're going to have you sign a piece of paper that is your contract that says you're allowed to sell with them it'll say you're allowed to do this you're allowed to do this you're allowed to do this you're allowed to do this sign here and that is your your contract with the insurance company telling you what you're allowed to do as an agent for them express is written express is in the contract a contract is written it's a typed up document it is written so express is written expressed as a contract you know you have that authority because you can read it on this piece of paper and it says you have that authority all right the next one is implied now this is assumed by the insurer there will be things that you do as part of your job that is not typed up in that contract they can't possibly write down every possible thing that you may do for them as an insurance agent like it may not you have the authority to buy post-it notes they're not going to say that do you have the authority to buy yes you can buy post-it notes write it off as a business expense sure whatever but they're not going to put that in your contract but they assume that you know that you could take care of yourself that you can you know do these things so implied is we don't implied is you do have that power because the insurance assumes that you can take that power that you have that power because there's just things that you're going to have to do for them working for them that may not be typed up so implied authority is still coming from the insurance company it's still real it's just not written down it's assumed it's implied like duh like duh you have to do this working for us we just didn't write it down in your content we didn't want to make your contract 20 pages long so we didn't write down every possible thing we just assume you can do it so that's implied authority the end it's not written in the contract it's not expressly written but the insurance company assumes that you can do it that's implied authority the last one which is the most trickiest one is the parent authority or also known as perceived authority and what has perceived me perceived is what a customer thinks is true you can have two people in the same situation and and both of them believe two different things based on what they perceive to be the situation now this is where a lot of arguments happen with couples they have different perceptions of what happened and so your perception is not reality your perception is your view of what is happening which may or may not be true so with a parent authority this is one where it's not real authority but it can make a real impact which is why you need to understand it when a customer comes to you just like we said knowledge of the agent is knowledge of the insurer when the customer comes to you they believe you are state farm or whoever it is you're working for so what you say out of your mouth they believe is the insurance company and they're going to trust you and believe that what you're saying is true if what you're saying is false but the customer believes it that's not real authority that's perceived authority it's fake authority you don't actually have that authority so for instance as an insurance agent you don't write claims checks that's the claims department you will never do a claim like that you may deliver a claim check but you aren't the one who writes them you're not the one who gets them out you're not the one who issues them so if a customer comes in and this actually happened in this the movie um fargo with billy bob thornton in it great movie love it crazy movie i actually i think it's a series but um there's an insurance agent in that um tv show and he tells the client that he will get the claims because oh yeah i'll get that claims check if her husband had died and he's like hitting on her and he's like oh baby i'm gonna get you that claims check don't you worry about it i'll have that available for you tomorrow i'll take care of everything what is the customer going to do she's going to believe him she's going to believe that he can get that claims checked because why why would he lie about that she's just going to trust him as an insurance agent but you as an agent do not have that authority to write a claims check so you shouldn't ever say it so a parent authority is where the customer is going to assume you have this power so you need to be careful about what you say now um with the how are you going to see a parent on the exam one perceived what type of authority is or what type of agent authority is known as perceived a parent or a parent is known as what type of authority perceived i think it's true but that doesn't mean it is another way that we might see a parent authority is on business cards or letterheads or stationery so if they say for instance that you um sent a letterhead to the customer with a handwritten note even if you're like you're so cute i want to go on a date with you like the per the customer is going to read that as an official letter from the insurance company and they may go oh my god if i don't go on a date with this agent they may cancel my insurance because it's coming from an official letterhead so anything that's typed up on an official letterhead or stationery of the business whatever you say you have to understand that the customer is going to perceive it and read it as an authority of the company the other way that we talk about a parent or perceived authority on the insurance exam is business cards that are printed too soon so let's say you call your grandma you're like hey grandma i'm studying for my insurance exam i'm going to be an insurance agent and i'm so excited grandma's like oh my god i'm so excited for you so then grandma decides to go to vistaprint and to make you little business cards that she can pass out to all her friends because she's so excited for you so she orders cards that say um joe licensed agent and she passes it out to her friends her friends are gonna believe that joe is a licensed agent because it says so on the business card be like grandma you pass those out too soon i'm not licensed yet i'm only studying but to the customer they're going to think that you are a licensed agent and that you could sell them insurance so that's another example of a parent authority all right so i got a question from astrid so right now my job which is an insurance company i'm still not the agent i only do endorsements file claims customer representative etc am i a parent authority or implied you're none of those because you're not an agent you would have to be these are agent authority and until you get your license you're not an agent you're like customer service or something like that but as an agent you have all of these as an insurance agent you have express authority which is written in my contract you have implied authority which is assumed by the customer and you have a parent authority which is assumed by the client the customer again a parent doesn't mean real but just that you have to understand the client is going to believe you to have the type of power simply because you work for the insurance company and that's the apparent authority okay judiciary as an insurance agent you are known as a judiciary however a fiduciary is a person of trust so judiciary person of trust judiciary person of trust judiciary person of trust as an agent you are being trusted with a lot of things social security numbers addresses birthdays credit cards all this stuff you're being trusted with a lot of stuff so you yourself need to be a person of trust you are now a future as an insurance agent now the biggest most important part of being a fiduciary is that you are going to collect money from the customer in the form of premium and then you need to submit it to the insurer so as an agent i collect money and then i submit it to the insurer so if you're dictionary is a person of trust who needs to be trusted with collecting the money and submitting it to the insurer and that's the main question they'll ask you about with judiciary that you are need to be trusted with the money that they collect and then submit it to the insurance company so i like to tell people judiciary funds judiciary funds judiciary funds funds is money they may not use the word funds they may use the word premium but premium is money money is funds so fiduciary funds funds is money money is premium premium is money it's all together it's just a memory trick but you may not actually see the word funds but when you think judiciary think funds which is money and your biggest job is to take the money from the customer and submit it to the insurer as if you're distributed the other thing which is not typed on here is that co-mingling co-mingling would be taking customer money and putting it in your wallet you're not allowed to do that you have to keep the money you collect from premium separate from your money you're not allowed to mix money so even if you you drove to a customer's house 100 miles away they pay you the premium in cash you're gonna drive back to your office and put it in the savings account bank whatever but on your way back you're like i'm hungry i'm gonna grab some mcdonald's you go through mcdonald's realize i don't have my wallet it i must have left it back at the office whatever i don't have my wallet but i have this cash that the customer gave me can i use it no you would be guilty of co-mingling which you're not allowed to do so don't co-mingle so co-mingle is mixing my money with premium money you're not allowed to do that you got to keep the money completely separate i have a question yes michelle okay uh one of the questions that i did notice on my exam fx was if a customer gave me a check for the premium i never turned it over like i was supposed to that day and they got into an accident sorry my dog just came in you've actually seen her on your facebook post um get down uh if she gets into an accident but i haven't given that money to you know whoever i'm supposed to give it to what happens who's responsible will it actually be an approved claim if she gets into an accident that evening when i haven't turned the money over yeah i know that's a little long but no is and that's another thing about law of agency that paying the agent is the same as paying the insurance company because imagine that so yours your case was that the agent just failed to do it for whatever reason but what if what if i collected the premium money and then i was in a car accident and it all burned up in a fire do i am i going to charge you another hundred dollars like sorry i lost your money you got to pay me another hundred to keep your insurance no you're like hex no i already paid you paying the agent is the same as paying the insurance company so as soon as so even this this matters like if an insurance co if a policy is going to cancel at midnight due to non-payment as a customer you can go to your agent's house knock on the door make them wake up throw them in money and say my premiums pay as long as the agent gets the money it counts okay so even and even if like let's say let's say that you know grant my grandma always pays her payment she makes she goes to state farm every month and pays her payment in person so let's say she comes in friday night like it's the end of the day the agents they're ready to go home go party whatever grandma hands them the check they say thanks grandma they give her a little receipt they put it on their desk and they're they're gonna come back to it later their their day is over they're ready to leave okay the insurance company has no record that grandma paid her payment because the insurance agent didn't log it which is totally fine there's no requirement that they have to log a payment the moment they get it and especially on 5 pm on a friday they're ready to go so let's say grandma gets into an accident on sunday she calls the insurance company the claims department they say sorry grandma you don't have an active policy should go no i paid they said okay we'll wait can we talk to your agent they go talk to the agent on monday oh yeah payment's right here grandma paid everything's fine they go okay grandma you're covered no problem as soon as you pay the agent you're paid your premiums paid even if it takes them a while to plug it into the system or even because insurance agents you depending on the state you have up to 30 to 45 days to turn that premium in so you collect it from the customer the insurance companies may still not see it for 30 to 45 days depending on the rules that you have to how quickly you submit it so as soon as you pay the agent you're paid um and what you're talking about in your example it would be an errors in admission problem so errors in admission is the type of insurance that we as insurance agents need to have if we make an error while setting up the policy or in this case um let's say that the question was a client called to add a fourth car you took down the information you said i'm gonna get that added to your policy your daughter calls mom i'm in an emergency you run over to help your daughter you completely forget about adding that fourth car a month later they crash it it's destroyed it's totaled what will happen the claim will be paid and the agent is gonna have to their insurance their eno policy would have to pay out for it for the mistake that they made so you made a mistake you literally have insurance for making a mistake and it's called errors and emissions and you're gonna have to buy it if you work for yourself you have to buy eno yourself if you work for a call center or whatever they'll buy it for you but you know is the type you know errors and emissions that's the type of insurance you have as an agent and it will be what pays for if you make a mistake okay um barb question on the mi exam a a marketing company is asking for customer information what do you tell them no you cannot give marketing companies information you're not allowed to share or sell insurance information without explicit consent from the customer they have to sign saying yes you can sell my paper to a marketing firm i'm not allowed to do that and that actually pops us into graham leech bliley as you're reading if you if you're just beginning to study or you've been studying whatever there's a concept called graham leech bliley it's actually an insurance um it's a banking law but it applies to insurance in the financing industry what you want to remember about graham leach bliley is it protects your privacy and that you need disclosures in order for the insurance company to share your information so if they plan to share your information they have to have a signature they have to disclose it to you and that falls under the rule of graham lee bleily and what you want to mostly remember though about graham leech blighly is that it's privacy protection so i like to pretend that's why i've been boxing pretend that you have body guards named graham and leech and bliley and they're protecting your privacy that's the main thing about gram leach blind is protecting your privacy i have three bodyguards protecting my privacy um and that if an insurance company shares my information they have to get a signature to that point though there are a couple of places you are allowed to share the information and the one i've seen them ask about is like an fbi or law enforcement so let's say one day you sit down you sell a policy to joe bob the next day the fbi comes in and says hey joe bob is a known serial killer we need to know everything that you talked to him about you are allowed to share that information with the fbi with the law enforcement with the police whatever that's the one place that you can share information without requiring a disclosure is to law enforcement okay all right now we're moving on to elements of a contract so elements of a contract is important because insurance policies are contracts so whether it's car insurance auto insurance homeowner's insurance health insurance life insurance they're all contracts a policy is a contract every policy is a contract so it's important for you to know contract law now there are four elements to a legal contract and you need to know all four agreement consideration competent parties legal purpose agreement consideration competent parties legal purpose agreement consideration competent parties legal purpose these are all four elements of an insurance contract of a legal contract and an insurance policy is a legal contract so an insurance policy must have all four elements one you need to just remember the names agreement consideration competent parties legal purpose agreement consideration competent parties legal purpose you must remember all four names then you need to know what each one means and the two they ask about the most are agreement and consideration they will definitely ask about competent parties and legal purpose too but you could expect potentially three to five questions about agreement alone and three to five questions about consider actually even more about consideration these two concepts are asked about a lot agreement and um consideration so let's talk about those and so i i saw somebody flat again if you have a question let's go ahead if you just unmute yourself i'll be able to see it if you have a question so what is agreement when agreement is known as offer and accepted agreement is known as offer and acceptance agreement is known as offer and acceptance when two people come in agreement it means that one person made an offer and the other side accepted it so one person makes an offer the other person accepts it you're in agreement agreement is known as offer and acceptance agreement is known as offer and acceptance one person makes an offer the other person accepts it you're in agreement okay so that is one question what is agreement offer and acceptance or what is agreement known as offering acceptance then they're going to ask you what is the offer and what is the acceptance what is the offer what is the acceptance the offer is when the customer submits an application to transfer their risk it's funny because like if you hear a commercial call us to save 15 or more on your car insurance that feels like an offline offer oh they're offering me to say 15 no no because even if you do call them and say i want to say 15 or more then i say what's your name what's your address what cars do you drive how many accidents have you had you are filling out an application when you answer those questions the offer is you listing out all of your risks and saying will you take them can i transfer these risks to you that is what the offer is a customer saying i have all these risks will you take them if the insurance company says yes they accept those risks and that means that they will issue the policy so agreement is known as offer and acceptance the offer is the customer submitting an application acceptance is the insurer issues the policy i offer my risks they accept it by issuing the policy we are in agreement so agreement is known as offering acceptance offer is submitting the application acceptance is the insurer issues a policy now where we get confused is with consideration because consideration also has submitting an application and it can get a little funky but consideration also involves money so what is consideration consideration is both parties must bring value both parties must bring value okay now if if i'm making an offer and you're making an acceptance we also need to give value to each other because otherwise why why else are we doing this we have to have both offer and acceptance but then we need to have value with it you wouldn't ever join an agreement with someone if you're not going to get any value out of it so consideration says both parties must bring value to the other parties both parties must bring value to the other parties then they're going to ask you what is the value on each side but they will not use the word value they use the word value in the definition of consideration consideration says both parties must bring value to the other party and then they're going to say what what consideration does the insured bring and what is consideration on the side of the insurer that's why i titled it this way in the notes consideration on the side of the insured consideration on the side of the insurer that's how they're going to ask you the question they're basically saying what value does the customer bring what value does the insurer bring and the answer is app plus premium on the side of the customer and promised to pay a claim on the side of the insured so let's talk about the customer side the value that a customer brings the consideration that a customer brings to the insurer is at all of my risks and the premium i'm willing to pay for it i give that to the insurance company and in return the value that they give me is promise to pay the claim they are promising that if i have a valid claim they will pay it that is the value that i give just a promise a promise that if something happens they will pay the claim so consideration both parties must bring value to the other party consideration on the side of the insured is at plus premium consideration on the side of the insurer is promised to pay a claim now where we get confused is offer not agreement by the way people will choose so there will be a test question that says a customer submits an app what is this known as some people will choose agreement no agreement is offer and acceptance the answer cannot be agreement unless you have both offer and acceptance if they're only asking about submitting the app that's offer not only do you need the definition of agreement you need the definition of offer and acceptance and don't confuse the definition of offer with agreement and the definition of acceptance with agreement they're all three distinctly different agreement is known as offer and acceptance offer is submitting the app acceptance is issuing the policy where we get confused is the value the consideration on the side of the insured is submitting an application but in order for it to be consideration you have to have the money the premium so if the question says the customer submitted an application what is that known as you're going to choose offer there's no discussion of premium so it's going to be offer offer is the customer submits an app offer is the customer submits an app that's it if they say a customer submits an app and pays the premium then the answer is consideration you have to have both the offer and the premium or just premium if they say the customer submitted premium what is that known as consideration money premium is the most important part of consideration okay next one is competent parties so competent parties means that when you sell insurance you have to sell it to someone who knows what they're doing they're not under the influence of drugs and alcohol and they are of legal age they're old enough okay old enough can kind of change depending on the state like new york you can buy life insurance at 15 or something but generally speaking it's roughly 18. so old enough knows what i'm doing not under the influence of drugs and alcohol if they ask a question that says you sold a policy to someone who was under the influence what happens the answer is the policy is voided it's as if it was never written because you never should have sold it to someone who was who was under the influence and didn't know what they were doing now in terms of being under the influence um if you are taking a daily medication thyroid blood pressure whatever that's not under the influence when they say under the influence they mean something that's going to impair your thinking impair your mind that's going to be under the influence even pain meds if a doctor prescribes it that doesn't automatically mean you're competent if your doctor prescribes you meds that say do not operate heavy machinery you are incompetent in terms of buying an insurance policy at least for the purposes of the exam so if they say recreational drugs alcohol pain meds those all will make you incompetent daily blood pressure medicine thyroid that's fine that does not make you incompetent so just keep that in mind another thing they like to try and throw you off with is asking about a felon the felon is fine as long as they are not under the influence as long as they know what they're doing and as long as they are of legal age they're fine just the word felon alone but oh they're incompetent no they're not they're fine they just have a felony so felons are okay all right last one is legal purpose which is joe exotic all day long so if you don't know joe exotic he's a man who's currently in jail because he tried to pay someone to go murder someone else you are not allowed to do that that's called murder for hire that is not legal that is against the law and if you attempt to do murder for hire you will be thrown in jail so that's legal purpose is that whatever contract you have cannot break the law cannot go against public policy and if it does it's not a legal contract and it cannot be upheld in court to anxiety if the guy didn't go murder which he didn't um that damn carol baskins joe wouldn't be able to sue him and be like i paid you five grand to murder her and you didn't i'm gonna take you to court they would both go to jail so legal purpose says you cannot break the law you cannot go against public policy so anything about law law law law is going to be legal purpose so they mention the law breaking the law not against the law it's all legal purpose all right um adhesion um okay so so agreement consideration competent parties legal purpose are the four elements of a legal contract and you want to remember all four agreement offer and acceptance offer submitting the app acceptance is sure or issue in the policy consideration both parties must bring value to the other party consideration on the side of the insured the customer is app plus premium consideration on the side of the insurer is uh promised to pay a claim competent parties i'm old enough i know what i'm doing i'm not under the influence of drugs and alcohol legal purpose cannot break the law cannot go against public policy cannot hurt anyone those are the four elements of a legal contract the next words that we're about to learn are um unique to insurance policies so they're part of a contract but just insurance contracts they're unique to insurance contracts you're not necessarily going to see these concepts on other contracts so the first one is adhesion and adhesion oh is my camera going in and out it might be my internet but i think it's plugged in it should be good all right hopefully it's okay um no i was actually talking about mine i keep seeing it zooming back and forth and i'm not sure why so that that's the question do you know where your camera circle is do you see your circle for where your camera is i'm on my ipad i just got the ipad and i've never been on zoom oh you're amazing so it could just be your ipad's kind of moving a little bit or i don't know but it used to be fun you could turn if okay so adhesion is the word adhesion is to think about adhesive adhesive is sticky glue is adhesive it adheres it sticks to so when we say that an insurance contract is it has adhesion what we mean is that the insurance company has to stick to what they said so if their contract says we will cover you if this happens they need to stick to what they said and cover you if that happens they're the ones who wrote the contract so they need to do what the contract says so adhesion is the insurer must stick to what they said if they said they're going to cover you they need to cover you the other side of adhesion is if i as a customer and i'm going to buy the policy i got to buy the whole policy i can't say i only want this and i only want that you got to stick to the whole thing all or nothing now there may be you know extra coverages that you can add and take off or whatever but the base policy itself needs to be the same um if a customer cannot have a different contract than you than you when they sell an ho3 for instance that h03 is the same for everybody what is typed up in that contract is the same for everybody and then you can add extras if you want you know endorsements for water sewer backup or whatever but if you were to buy an endorsement the wording of the endorsement cannot be changed by you it can only be unchanged by the insurer um adhesion is they stick to what they said the way that they typed up your endorsement is the way they type of everyone else's endorsements you all are reading the same language the same words they have to stick to what they said and when you buy the policy you have to take all of it or none of it so if you're like i only want this i only want that to be like sorry you can't you have to buy all of it or none of it once you buy all of it then you can sprinkle on some extra endorsements and some extra coverages but you can't just say i only want some of this and i only want some of that and i don't want any of this delete that paragraph for me no they're not going to do that for you they stick to what they said and you have to buy all the policy or none of the policy the next one is alliatory alieatory um you could say it either way it doesn't matter all it's reallyatory this one is about an unequal exchange so when you pay my life insurance premium for instance 28 dollars a month my payout 2500. yeah 250 000 sorry 250 a quarter of a million dollars 28 250 000 this is very unequal 28 250 000 very unequal that's alliatory alienatory when we pay our premium even if i pay 28 every month for the next 30 years which is how long my life insurance is for it will not add up to 250 000 not even close our premium that we pay is teeny tiny compared to what the insurance company can pay out and that's what alliatory aliatoria is saying it's an unequal exchange now that one will usually come in the form of a scenario question they will say john purchased his life insurance policy two months ago he has paid 200 in premium he dies and 20 000 pays out to his beneficiaries what does this represent alliatory 200 in exchange for 20 thousand is alliatory aliatory an unequal exchange so i like to uh my memory trick for this one is to be a seesaw uh going back like if you think the scales of justice they're never balanced um aliyah tori ali tori it's never balanced it's always wonky one side is paying a little bit one side is paying a lot more so alliatory aliatory personal just means that the contract is between you and the insurance company so personal is between me and the insurance company um that's just all that's all i mean the policies between you and the insurance company now if you it's very rare that you can give away your policy to someone else especially when it becomes property casualty you can give away your life insurance all all day long you could sell your life insurance that's fine but when it comes to home and auto it's very rare that you would give your policy to someone else like even if i sold my car to you i'm not giving you my insurance i would have to cancel my insurance you need to write your own we don't give away um policies like that but there may be times where like a husband and wife are married they both buy you know together they buy a homeowner's policy on the house but it's like under the wife's name because she's the one who called in and then they get a divorce and the husband is keeping the house they they won't necessarily rewrite the whole policy um but what they will do is they will assign it to the husband so that's another word that's not typed up here but assignment is when you assign your policy to someone else very rare in the property and casualty world um usually only for like a husband and wife situation like that but if you if you're giving your policy to someone else you're assigning it to them and sometimes with personal they say that you you can't just give your policy away because it's between you and the insurer all right unilateral is known as a one-sided promise so we're talking about unilateral and if we go back to the idea of what is consideration on the side of the insured it's a promise to pay consideration on the side of the insured i messed up there consideration on the side of the insurer is promised to pay what is unilateral one-sided promise only one side is making a promise and it's the insurance company the insurance company is promising that if our house burns down they will rebuild it they are promising that if we crash our car they will pay to fix it it's a one-sided promise as a customer i'm not promising to pay my premium if i fail to pay my premium they just cancel the policy goodbye move on if the insurer though if they fail to pay a claim guess what i'm doing i'm suing them i'm like no no because the insurance company is legally bound to me because this is a legal contract so unilateral says it's a one-sided promise and only the insurer is legally bound to do anything because of that promise so if i fail to pay my premium as a customer they cancel move on doesn't matter the insurer pays fails to pay a valid claim i can take them to court and sue them and a judge can make them pay that's what unilateral means one-sided promise and only the insurer is allowed to um only the insurer is legally bound to do anything okay um i have a question yeah go ahead um so i had this uh similar question on uh new york uh test uh it was pretty much um insurer pays the claim but the insured uh does not pay the premium and i was pretty much down to an uh auditory or a unilateral and it was a little bit confusing because it seemed like it was an unequal exchange but at the same time as a one-sided type deal as to why they paid the claim have any of without the premium it just pretty much was afforded in a way where uh that was the agreement that the insurer played the paid the claim but uh insured did not pay the premium and it just gave you like options of it was like adhesion alliatory unilateral and i think it was conditional or something like that but um i i don't like 100 remember i just remember i was down to the last to the auditory and unilateral and i picked unilateral but i don't know i got it right was it waver and estable was that in there no no okay it was just those four options and it was it was very weirdly uh worded that's why i thought it was i was stuck on it for like maybe two or three minutes yes yeah if you are stuck on a question and you just don't know just move on you're allowed to get you know 30 of them wrong 30 wrong you know in most states um oh michelle that's funny because that should be in your general all of these should be well oh some of these words are not necessarily in every text so i teach to the most common so there may be one or two words that are not important to you that are to another state um i think i kind of said that at the beginning there may be some things in here that are not on your state exam but this should be in i believe you're in georgia um yeah you have insurance terms really concept but there may be a couple words you don't have yes patrice what's up you can unmute yourself that'll be the fastest way to ask your question um okay so um i'm more of a the definitions is fine but i am more trying to understand the concepts of like the 30 days the percentage is like you know um a policy with a hundred thousand um you know makes a payment of 80 000 like the percentages um the numbers it's more what i need to work on and also the commissioner uh i know like details because i want to go take this test like two days ago and i did pretty good on this however when it got to the next part it was like strictly on what i need like two years before i renew my license what is the commissioner's job um how much is this fine like so i need to work on the numbers and the rules and regulations more than the definition okay so that would be like a state law class i have one of those available for um sale um this was this one was not slated to talk about state law what state are you in by the way i am in texas okay so yeah texas has makes up a pretty decent percent like um i think around 20 not quite 20 of the state exam so that is pretty important um for you and i do have the state regulations class today we're supposed to talk about what to study most tested topics in q a um state law is not it is important for sure and um there are a couple of videos i have on youtube about what to memorize you do want to memorize like how long your license is good for and that's different for everybody you do huh when is the next the state law class do you have another one coming i don't have one on the calendar but i do have a recorded one available for sale okay definitely um you can keep going i'll just literally uh try to email you to purchase the state law class yes and i do have um um i do have homeowners class an auto class dwelling class the only things i don't have classes on are commercial because like i said you don't really need them to be able to pass the exam um i was definitely i think we're down to like 45 minutes um i definitely plan to talk about homeowners and dwelling in this class not that i i purposely didn't say it because you never know what and what ends up happening with classes but um i fully intended to do that i'm actually going to send you guys a link for my home and auto class that is paid for you may already have it if you have the all access but if you don't um i'm gonna actually include it in this so this class will end up just being um like general insurance terms which again for most people this does represent a very large chunk of your exam um for for a lot of people so that's why i tend to focus on these so i will and so what you were also asking about was co-insurance if you have a house for a hundred thousand and you insure less than that and you file a claim what's going to happen that's all coinsurance and that is going to be included in the the homeowners class that i send you so i will um as as if you're watching this recording you're not going to get that but if you're sitting here live um i will also include my um homeowner's class and then i will share at the end um how to how to buy my stuff and where all my stuff is if you don't already know that okay um we're to be getting a misrepresentation here in a minute um okay all right so where were we conditional unilateral once okay conditional just says that both parties have to have rules and duties um uh that is its condition like think about the word unconditional love unconditional love means you love me no matter what conditional says you got rules in place and if i don't follow the rules you don't love me anymore um insurance policies are conditional you have to follow rules or this is over you have rules and i have rules we both have rules we have to follow or this is over um so and and it's not just the customer both like one of the rules for instance is that like you said the 30 days in order to file a claim you need to file within 30 days in most states then the insurance company has 60 days to pay you in most states so like you have a rule i have a rule we all have rules when it comes to conditions and conditional you want to say you want to say um rules duties obligations ways of behaving those are all conditions so rules duties obligations ways of behaving that's all triggering you to to choose conditions so they say where does the customer go to find the rules conditions where does the customer go to find their duties conditions where does the customer go to find out how to act after a claim ways of behaving conditions so rules duties obligations ways of behaving are all the trigger words for you to go oh that's conditions they're talking about conditions conditional all right next one reasonable expectations um this one's kind of a weird one but this one is just saying that if the agent said you'd be covered for that you can expect to be covered for that so they're like um you know you're the agent implied that you would be covered for this what does that mean i can reasonably expect coverage um the state law i'll go over how to get the state law class at the end of this class um identity we talked about that one before restore the insured to the previous financial condition um representations and misrepresentations and warranties so these ones can can be a little bit confusing so first let's talk about a warranty a warranty is an absolutely true statement must be true is true has to be true that is a um warranty warranties are used for things like home and auto i live at this house 123 main street that is a fact that i can guarantee it i live at this house i drive a 2009 toyota prius that is a fact there's no wiggle room for it to be wrong so warranty is used for home and auto where things are factual now if you lie about the warranty you are voiding the policy so if you're what was supposed to be your warranty is false you have lied to the insurance company and they can void your insurance so warranty must be true is true has to be true and if it's not true then you are um guilty of fraud concealing whatever and they can void the insurance on now what is a representation representations are used for life and health and this is where you can't speak in facts and guarantees like on a life or health application for insurance they're going to ask you do you have cancer well as far as i know no is it possible that there's a tumor somewhere in my body yes it is possible so with life and health applications they can't have warranties because you can't guarantee that there's nothing going on inside your body when we don't have systems to absolutely know what is going inside our bodies okay so a representation is i believe it to be true i think it's true to the best of my knowledge is true but it might not be true that is representation so i think it's true to the best of my knowledge is true i believe it to be true but it's possible that i could be wrong so if they say do you have cancer and i put no and then i buy the policy they issue me the insurance two months later i go to the doctor crazy headaches tumor in the brain based on the size it's been growing for the last six months well shoot i bought my insurance two months ago and i told him i didn't have cancer when i did are they going to cover it yes because to the best of your knowledge at that time they didn't have um cancer to the best of your knowledge and so they will still cover it so that's a representation i believe it to be true i think it's true to because my knowledge is true but it might not be true where warranty must be true has to be true absolutely true and that's the difference between those two representation i think it's true i believe it to be true but it might not be true warranty must be true is true has to be true and if not you void the policy if a representation isn't true it's not voided it's just oops you didn't know that you had a tumor okay now we know let's clean it up okay um now yes so i see on the michigan exam these four that you are kind of talking about or getting into right now with the um representation misrepresentation warranty concealment and fraud i know you're moving into that but my problem is the question usually goes something like someone's doing an application and um they say they've never been in an accident or they say they never had a ticket but their son had a ticket which one does that fall under like is is it that they concealed it but i think it would only be concealment if they knew and didn't put it on there but it wouldn't be fraught or would it be fraud because they actually knew the sun had a ticket and didn't put on there so that's where i'm kind of getting a little bit confused when it comes to these in order for the answer to be concealment you need to see withholding or height they withheld the information they hid the information then it's concealment fraud is generally you know you outright lied you attempted to deceive you're trying to deceive if if the question is saying they ask do you have a ticket and the customer didn't understand that you meant you and your family and your son and your thing then that's just that's the whoopsies so i guess it depends on more of the question but in order for it to be concealment it has to be withholding or height does that help a little bit a little bit i i feel like if you know you're honestly saying the wrong answer it sounds like concealment to me but i get what you're saying whereas because it also sounds like fraud so the customer tonight can i say something oh i'm sorry it is maybe this is maybe this will help if concealment like lying by omission and fraud is you're just outright lying right consuming is a liable mission by withholding or hiding and fraud is just an outright lie yeah okay the thing is is that concealment is a form of fraud you have you have fraud this this represents we haven't talked about fraud is deceiving or lying or cheating the insurance company and um concealment is withholding or hiding you're deceiving the insurance company by withholding or hiding they go together right but consume it is specific to withholding or hiding you're you're trying to conceal what you're doing you know i don't want you to see this i don't want you to know this that's that's concealment um whereas fraud is just i'm trying to deceive you i'm trying to um lie about something but not necessarily withholding ourselves so i know it gets weird but when you see with hiding or holding that's when you choose concealment thank you yes sonia they will they will use the words with hiding hiding or withholding or some some sort of concealing means you like think concealer you're trying to conceal the fact that you've got bags under your eyes you're trying to hide it don't look at don't look at it i want you to see it that's what concealing is doing you're trying to prevent them from even knowing about it from seeing it whereas fraud would just be like an outright lie kind of weird but that's how it works now um with the misrepresentation this is simply an untrue statement so this is this is where the information is known and it is available but maybe you forgot you misunderstood you don't understand the question that can be a misrepresentation so this so this would be like do you um yeah i mean there was actually i've seen an exam question that said you know carlos um was addicted to drugs for a long time he was in and out of rehabs he had a lot of medical stuff done he he's okay now he goes to buy insurance when they ask him about his medical history he forgets most of it doesn't put it down on his application he later files the claim what will they cover all of it he didn't try to deceive them he literally just didn't have a memory of it because he was on drugs full time so he would still be covered he would still be okay so um it's it's only an intentional purposeful misrepresentation that becomes fraud but if it's simply i forgot i don't understand i don't get it then it would just be um a misrepresentation an intentional misrepresentation though would be actual fraud um jeff i believe you're asking about miss material material i don't i didn't put it in these notes because i sometimes i focus too much on material when it's not even asked about very much so i don't even put on the notes but there also is something called material misrepresentation and the thing you want to know about material is that it's withholding or hiding so um sorry sorry that's concealment material is i would have made a different decision so if the insurance company asked you a question and you gave them the wrong information whether on purpose or accident whatever and that piece of information had they known the truth they would have changed the policy offered a different coverage offer different premium that's material to them a piece of information that would have changed their mind would have caused a different premium a different policy a different coverage they may have even declined you completely because the information that is what material means so when i think of material i think of altering it would have altered their decision so think of a piece of material i want to take it from a long skirt to a short skirt i'm going to alter it i'm changing my mind from a long skirt to a short skirt i'm going to alter the material a different decision is being made based on this so material is i'm altering my decision and i'm changing my mind that is that's what material but i won't go further into that because we don't talk about them or wrench okay um now we have so we talked about concealer we talked about fraud okay so that represents um general um insurance now we can move into pnc basics uh or we have two options here so i can start jumping into talking about some of this or if you all have a bunch of questions i do want to be available to answer questions so if there's any other questions that you guys have and you want to spend time like if you say melissa show us the math problem i'll do the math problem right now let me know what it is you all want because i can just you can have these pnc notes you can see the definition of them um and if you have the all access pass it's not different from what i'm teaching but now you have me live so is there anything you want me to do live okay barb says show the math we could do the math math math math yes okay let's do the math oh where are you you saying we will receive this in the email right yes so whatever email you used to um sign up for this i will be emailing you the recording and the notes that i sent you will we be getting the notes tonight i'm sorry to ask that if you click them in the the chat box yes i don't plan to send out the email until i have the recording available yeah i'm i'm just asking that specific question because i'm taking my first test tomorrow okay so hang out at the end michelle i know you're scared to click the link because of your zoom stay with me to the end and we'll make sure you do it one question from the other pnc video that you had sold what's the question how are these notes different from the other video the pnc basics that you had for sale i did purchase those are they similar they're the same they're the same um and my notes are really available for anybody there's nothing necessary for purchase if you ask me can i have your notes i send them to you um i had also purchased with the um i don't know it was one of your other videos yeah if you purchase a general insurance or pnc basics class they should be in there and if they're not there but you're gonna be getting them anyway but yeah i don't have a budget i don't have a finance of notes you know they're all i give them all away is what i'm saying yes okay i hope that answers your question okay let's do the math okay so now this math is not it's not going to make or break you and what i mean by that is if you don't know how to do the math you're going to be okay but if you know how to do the math you can definitely get yourself a couple of points and and feel like less anxiety that's okay michelle go ahead okay so the biggest math in this um on this exam is going to be the coinsurance so co-insurance what is co-insurance if the idea of insurance is that my house burns down and you rebuild it how much money should you be insuring that house for as much money as it would take to rebuild that house and that's called insurance to value so insurance to value says if you have a three-bedroom two-bathroom house that costs 250 000 to build you need to cover that house for 250 000 that is insurance to value now most uh claims homeowners claims are 25 000 or less meaning that it's very rare for someone's entire house to burn down but they are asking us to cover the entire cost of our house even though the majority of us will never ever have to pay a claim or never have a claim for our whole house burning down so insurance companies are like listen fine if you don't want to cover 100 of the rebuild that's fine can you at least carry 80 if you carry at least 80 percent of what it would be to rebuild the house we will be happy we'll be okay and as long as you do that claims are paid as normal so for instance what i'm saying is let's say that you have a house and we're going to use very nice rounded even numbers here let's say that this house is a hundred thousand dollars to rebuild and and you say well i don't and the premium for that is like you know too much you say i don't want to pay that much premium my house is not likely to burn down they're gonna say well can you at least carry eighty percent which would be eighty thousand dollars as long as you do that they will pay every claim like normal they won't even care that it's eighty percent they'll just pay it like normal five thousand dollar pay claim five thousand dollar payout twenty thousand dollar claim twenty thousand dollar payout as long as you are within the eighty percent eighty percent of the rebuilt so 80 of the rebuilt to build the house from the ground up whatever that costs your insurance policy should be at least eighty percent of whatever that value is and as long as it's at least eighty percent they will pay every claim like normal it's when you start covering your house for less than 80 that they do coinsurance and coinsurance says you are cheap you are cheap you're carrying less than 80. we will be cheap we will be cheap when we pay the claim being cheap is covering your house for less than eighty percent and so when they pay the claim they will pay less than eighty percent for the claim or less than the the full claim amount not sorry sorry i said that wrong so what they're going to ask you when it comes to coinsurance is they're going to ask you a couple of things why are you not moving move move sorry my whiteboard is giving me struggles oh my gosh stop there we go oh i gotta use two fingers that's what it is okay so what are they gonna ask you with coinsurance one they're gonna make sure you know is the insured within eighty percent is the insured covering at least eighty percent of and they will either use the word replacement or rebuilt same thing is the insured covering at least 80 or rebuild some of your coinsurance questions will end right there you confirm that they're covering eighty percent and they pay the claim like normal some questions will make you go into step two which is the co-insurance equation so is the insured covering at least 80 percent of replacement or rebuilt you're either going to have a yes or you're going to have a no if it is yes then they will pay the claim as normal pay the full claim okay if they're carrying at least 80 they will pay the full claim if the answer is no then they're going to do step two step number two step number two is the coinsurance equation do the coinsurance equation do the coinsurance equation and the coinsurance equation is this what did how much should be thicker so the the coin coinsurance equation the coinsurance equation is did carry divided by should carry and when i say carry what i mean is what is the amount of coverage how much coverage are they carrying so what did i carry versus what should i carry and the should carry is the 80 because they're okay with 80 carry at least 80 percent then we're going to multiply that times the loss and that will equal the claim payout okay so we're going to do a couple of these as examples so that you feel comfortable and confident with these so again let's recap a little bit insurance to value says you should insure your house for as much as it would cost for us to rebuild it that's insurance to value they're cool as long as it's eighty percent carry at least 80 and we will pay every claim like normal because think about it for a minute if if this i have not talked this much ugh his arm my throat really scratching right now i used to teach eight hours a day for five days a week i have not done that in a while okay what was i doing oh okay so let's say this yeah be thicker why are you so small so let's say that this is my house this is a hundred percent of the house this represents oh let's get a different color this blue part represents eighty percent essentially what the insurance company is saying is like look you're asking us to cover this whole house but you're only covering this much work you're leaving this other 20 uncovered if you think about it like that but they're cool with it they're cool if it's at least 80 coinsurance comes in when someone says well i have this full house and let's say the rebuild is a hundred thousand but i'm only going to carry so 100 000 would be the rebuild i'm only going to carry uh 50 000. you're basically saying i'm only covering half the house if you're only carrying 50 but the rebuild is 100 you're only covering half the house and if you were to make a claim with a big old fire is it fair to make them the insurance pay the entire claim when you're only covering half the house not fair that's where the coinsurance comes in this is the i'm going to be cheap you are cheap i'm going to be cheap if you're so cheap to only cover half of your house we will be cheap when we pay the claim and they use the math problem to determine how much of the claim they're going to cover because they won't cover all of it you're not covering all of the house they shouldn't have to cover all of the claim that's what co-insurance is about and you do the co-insurance equation when they're carrying less than 80. so let's look at a couple examples let's say that they said bob has a house with the current replacement at 200 000. bob decided to carry coverage a at a hundred and fifty thousand um one day he had a fire that resulted in thirty thousand dollars of damage how much did the insurer pay how much did the insurer pay okay so you have replacement and this is going to be like a big wordy question so i'm gonna say it again so you guys can capture the question bob bought a house and the current replacement is two hundred thousand dollars bob decided to carry coverage a at a hundred and fifty thousand he experienced a fire that resulted in thirty thousand dollars of damage how much will the insurer pay so the first thing and these this is the only pieces of information you need to know so they might give you other numbers just to throw you off i don't the only numbers you care about replacement price how much is it to rebuild that's replacement is rebuilt how much did they carry on their coverage and how much is the claim that's all we need to know so when you get a coinsurance a question everybody should get like a piece of paper or a little whiteboard when you take your state exam you can write down those things write down those things that you can see the questions say oh this is co-insurance what's replacement what's carry what's claim those are the things i need to know and think of the claim as the loss that might be the better word for it claim loss same same tomato tomato okay so the thing that we need to do with this question is we need to find we need to find eighty percent or say what is eighty percent of 200 000. now the majority of you will get a calculator and you're going to be able to pop up your calculator where are you you're going to be able to have a basic little calculator like this and when you need to find 80 percent of something this is the equation that that you use so you're going to do you're going to put in the rebuild number because the numbers can change you're going to hit the multiplication sign you're going to put 0.80 and then you're going to hit equal this is the equation to find 80 percent of something put in the rebuild number the replacement price of the house multiply it times 0.80 equal and that will be 80 so in our example it's going to be 200 000 times 0.80 and we put that into our calculator two hundred thousand times point eight zero equal a hundred and sixty thousand so eighty eighty percent of two hundred thousand is a hundred and sixty thousand okay he decided to carry a hundred and fifty is he within eighty percent no he is less than 80 80 is 160. if if it said he carried 160 the answer would be they paid 30 000 because as long as you're carrying 80 they will pay the claim in normal if you're not carrying 80 then they begin to do the coinsurance equation so for our example since he carried 150 that means we're gonna need to move into step two because remember what we said step one is the insured covering at least eighty percent yes or no yes pay the claim in full the answer would be thirty 000. ours is no though because he's not within 80 he's covering 150 instead of 160. so then we're gonna have to do step two and step two says do the coinsurance equation which is did carry divided by should carry times the loss equal the claim payout so let's go ahead and do that for our example here so in our equation with him we would say what um it's did carry he did carry a hundred and fifty thousand that's what he carried that's how much coverage he had we're gonna divide that by how much he should have carried which is the 80 percent should have is the 80 so we're going to put 160 down here a lot of people will make the mistake and put 200 down here you it's not the full replacement it's the minimum of 80. because as long as it carries 80 they're fine it's when you go less than 80 that they have a problem so 150 000 divided by 160 times the loss which is the 30 000 will equal the claim path and again you get your handy dandy calculator clear it out because it's probably too dumb and stupid to handle multiple equations and you also have to take this one step at a time too you're not going to plug this whole equation in and hit equal you got to go one step at a time the first step is 150 000 divided by a hundred and sixty thousand equal hit the equal sign don't just go into the multiplication it won't work there the calculators are too simple for that so you're going to go 150 divided by 160 equal sign in the calculator then you're going to do times 30 000. so times 30 000 equal 28 125 25. that will be the claim payout and that's the answer choice you would need to choose out of abcd is the 28 125 now in this instance he is very close to the 80 he's only 10 000 off so the difference between 30 000 and 28 isn't so bad but the lower you get after 80 the more drastic the claim payout will be so the the less you're carrying the less the claim payout will be is basically you know what i'm saying so sometimes the questions will just be you checking for 80 so if we had another question that said you um we have an insured whose replacement is 300 000 he decided to carry um 280 000 and he had a claim for ten thousand remember step one what is eighty percent of three hundred thousand i do three hundred thousand times point eight zero equal get the handy dandy calculator three hundred thousand times point eight zero equal two hundred and forty thousand so he is within 80 because he's carrying 280 which is way more so your answer would be 10 they will pay 10. he's carrying at least 80. he's carrying more than 80 they will pay the full claim and your problem stops there you don't need to do the coinsurance equation you he's covering 80 at least problem is done okay only some of them will some you're going to have to mix back some will be checking the 80 and being done because they are within 80 some will be they're not within 80 so then i have to do step two which is the coinsurance equation so let's do another one so that we can just have the practice of it so using our numbers since we already know so let's say that oh gosh why you're supposed to be fat get that there we go so let's say that replacement is 300 000 and let's say that he decided to carry um 210 000 and and i'm purposely choosing one that's less than 80. that's why we're doing because we want to practice that one that one is the one that involves a lot more math than just the 80 so he decided to carry 210 and let's say that the claim or the loss is 50 000. okay so we already did 80 remember we did 300 000 times 0.80 equal and we found out that it was what was it 240. so we already know that it's 240. we already did step one it's 240 000. so he is carrying less than 240 he's carrying 210 which means we need to do the coinsurance equation because he is not within eighty percent if he was within eighty percent pay the total claim fifty thousand paid less than eighty percent do the coinsurance equation so our coinsurance equation his did carry he did carry 210 000. he should have carried remember that 80 is the should he should carry 240. we multiply that times the loss of 50 000. and then that will equal the claim payout so again we whip out our our little handy dandy calculator 210 000 divided by 240 000 equal times 50 000 equal 43 so not not so bad so not terribly off but the the customer would be responsible for that other seven the other seven thousand so you're on your own you were cheap we're going to be cheap sorry you got to pay for it now so that's the thing with co-insurance is you may you may pay a lower premium but when you file a claim and they're they're missing seven thousand dollars because you didn't carry enough you're gonna feel it so you might as well carry 80 and there's a lot of insurers that will refuse to cover less than than 80 okay so that was another example i do have a uh coinsurance uh video on youtube and then like i said i'm gonna send you all the homeowners um class as well and that that will have coinsurance in there too um okay so now if you have any other questions let me know i'm gonna go back through i know i missed the question about conditional um someone said to repeat the words for conditional duty melissa yeah i'm sorry um i don't know if this i think this is way different from what i was thinking what you just did the coinsurance was great but what's the one where they say insurance a has this much insurance b has this much and then you're supposed to figure out how much each one of them is going to cover because that's the one i need that i saw on the exam you got it okay that one is called pro rad okay yeah i definitely don't understand and pro rata is about a fair share a fair share okay okay what this means is let's say that i have um the building and i want to insure it for a total of 200 000 but when i call an insurance com there's various reasons why they may or may not share the full value whatever so let's say that i have company a who is going to insure this building for 150 000 and then i have company b and they're going to insure it for 50 000 because i wanted a total of 200 but for whatever reason i couldn't get one company to do it so i got two separate companies totally fine no rules against it we're cool the only thing that's that breaks the rules is if let's say i had a ten thousand dollar claim oops i want to turn that purple or whatever if i had a ten thousand dollar claim in this one building should i get ten thousand from company a and ten thousand from company b uh-uh no remember i said insurance companies are friends they're going to talk to each other they're going to know that they're both covering this building and they're going to know that you're filing a claim to both of them and pro rata and it's actually in the insurance contract it's called other insurance where it's in the policy and it says if you have more than one policy covering the same risk each company will pay a fair share pro rata so what is the fair share let's just look at an example if this building were to be split up equally in four ways so we're splitting up this building equally in four ways company company a is covering three of those squares a hundred and fifty thousand company b is only covering one should and so what this is telling us is company a should pay for three-fourths of the claim because they're covering three-fourths of the building company bay b should pay one-fourth of the claim now we're not going to do it this way this is only a visual you don't have to understand fractions and you don't need to draw visuals this is just to help us understand it that what the fair share means this is how they get the fair share if this whole building represents 200 000 that means that this square is 50 this square is 50 this square is 50 this square is 50. if we broke up the building into equal parts of 200 000 and if company a is covering 150 they're covering one two three squares of the building and company b is covering one square of the building at 50. okay this is just a visual to help us understand when you get on the state exam though you're just going to have to do the actual math problem so here's how the math problem looks they're going to give you a problem just like this company a is covering the building for 150 company b is covering 50. you have a ten thousand dollar fire claim ah that's not why i think that's not showing up very well let me turn this black too there you go it's a little bit better okay um so let's say so company a 150 company b 50 10 000 fire and the question will be something like this how much did company a pay okay of the ten thousand dollar fire now if you do know math what is three-fourths i think it's like 75 boom you know the problem if you're not that math inclined then you need to do the equation so here's how the equation looks when you're doing a pro rata equation a fair share equation it looks very um similar to the coinsurance equation um you have a division you have a multiplication you have an equal but this one is you're going to put company oh gosh not showing up very well you're going to put the company you're looking for on top so how much does company a pay so company a is going to go on top company a plus b is going to go on the bottom you multiply that times the loss and that will be the payout for the company on top now it's not always company a on top like if they said company b you're gonna have to put company b on top whatever company you're looking for is the one that will go on top it could even be c or d or f or x y z or susie's salon whatever word they use the one you're looking for is the one that will go on top but what do i do when it's asking for both you're gonna do this equation twice or do a subtraction problem okay so if they say what is company a pay right now we'll focus on that one so we do company a divided by company a plus b times the loss which is the um the fire damage will equal the payout for the company on top so let's do that one for our problem so we have company a which is 100 and gosh oh i want my marker to be fatter and is being so skinny i don't know what it's doing all right we have company a which is 150 000 divided by a plus b which is going to be 200 000. we're going to multiply that times the 10 000 fire and that will be the payout for company a so just like before we've got our handy dandy calculator we do 150 000 divided by so company a divided by all the companies added together if they give you company a b c d e f all the companies added together goes on the bottom no matter how many companies they give you add them up all together put them on the bottom the company i'm looking for on top divided by all the companies added together on the bottom times the loss will equal the payout for the company on top so 150 000 divided by 200 000 equals remember hit equal because the calculator can't handle the full thing then you do your next step times ten thousand times ten thousand equal seventy five hundred so you would go company a is going to pay 7 500. now you have two choices here if they were to ask what is company a and b pay you can do this one of two ways one you can redo the problem and do it with b on top fifty thousand because that's company b divided by all the companies added together times the ten thousand equal company b payout so 50 000 divided by 200 000 equal times because remember we got to do the equal part right here then you do the times ten thousand times ten thousand equal twenty five hundred so that's one way to do it or you can go well the claim is 10 000 and if company b pay or company a pays 7 500 what's left over is the 2500 10 000 divided by 7 500 equal 250 2 500. so if if you either just do the equation twice if they're asking for both companies or however many they're asking for they they may even say company a company b company c were all covering one building how much did company a and b pay so you got to do the equation twice to figure it out or if it's only two companies you can just subtract company a from the claim amount so if the total claim is 10 000 and company a paid 7 500 all that's left is 25 so that's what that's what company b will pay so no matter how many companies you have remember that you're going to do the company i'm looking for on top the company i'm looking for on top company i am looking for the number whatever divided by all the companies added together times the loss will equal the claim payout for the one on top and then i just keep doing that as many times as i need to to get all my answers so it might be company a on top divided by a plus b plus c times the loss and then i also have to do b on top divided by a plus b plus c times the loss and then i'll be able to choose company a will pay 7 500 and b will pay 2500 and boom there's my aunt does that make sense i think i believe i also have a program yes youtube as well no that help thank you perfect okay all right so right now i'm going to go to the chat answer any questions i missed there um add any other questions you may need and or just unmute yourself once i finish the the chat scroll okay can you repeat the trigger words for condition conditions are rules duties obligation ways of behaving conditions are rules duties obligations ways of behaving if i hear one of those four words i read one of those four words in the questions i'm looking for conditions as the answer okay um formula formula okay um richie i'm i'm an insurance company won't cover ride share and the insurance says they don't but then changes their mind to decide to start uber doordash without telling the insurance company is that considered material or concealment um if when you fill out the initial application you're not doing rideshare and you say i'm not doing rideshare that you're not lying if you later do rideshare that's not that's not material unless they can i mean if you it's weird because unless they specifically ask you are you doing lift and uber and then you say no when you are that's concealment but if you end up doing it later not realizing that you need to update your insurance which you definitely do and there's now ride share endorsements that's kind of a different story um so i'm not sure if it was word how exactly was worded or anything um but it for that question i would i would go with if if if exactly what you're saying is align with the question i'd probably go with concealment although i really don't like the whole change their mind thing that's not truly concealing so i'm not sure i feel like i would need to know more information for that one um sonia for south carolina is pc one exam or separate i think you could take them together some states say you have to take just um just property and then just casualties some will let you take them together in one test and i'm pretty sure that south carolina allows for one full test which i would always recommend i would never encourage anybody to split property and casualty some states force you to and i'm sorry but if you could take both of them together definitely take both of them together south carolina does allow you to take them together so i would take them together if you can will they throw in like the practice test the minus and standard deductible um i'm not sure what you're referring to jeff when you talked about that but if you're talking about like a coinsurancy question they usually will say don't think about the deductible don't worry about the deductible so if they because because technically you have to pay deductible for pretty much every claim so when they say how much will the insurer pay technically it should be minus the deductible but they don't really ever ask you about that if they do say that the deductible is a thousand dollars then you would need to subtract it from the total claim payout but usually they'll say not considering a deductible how much will the insurer pay so a lot of the times they won't include don't unless they mention it don't worry about the deductible with coinsurance questions well like in my excel practice um quizzes one of them was like um including the applicable deductible you know how much would the interior the insurer pay and then you had to do the co-insurance equation and then get the amount and then pick the amount that was correct with the subtracted deductible okay yes if they say it then you've got it included you've got to subtract the deductible yes but they don't tell you what the deductible is though well then if they don't tell you that then you can't do it and don't worry about it honestly i'm not i'm not saying you're wrong necessarily but i would most of the time they say ignoring the deductible or however they word it is usually trying to say don't think about the deductible they might word it weird but if they don't give you a number for the deductible you can't do it anyway unless they say do they say standard deductible yeah well that's 250. that would be a test question so homeowners in dwelling has a standard deductible of 250 in most states i believe that michigan has someone has a 500 virginia i think virginia has a 500 but standard deductible for homeowners and dwelling is 250. okay so there might just be asking you to memorize that if they say if they do have a standard deductible and you have to include that in the question then remember that it's 250. okay in most states double check your text your coursework everyone is every state's a little bit different i believe it's 250 here too okay perfect michelle installation floater is used to ensure um an insulation floater is used to ensure something that is being installed so imagine let's say so i one of my one of my um jobs as a school teacher i was in a four-story building and they had huge air conditioners on top an insulation floater is when that building let's say the owner of that building is going to replace the ac unit they're going to take out the old they're going to use a crane to remove the air conditioning and then use a crane to put the new one on the installation floater is what you would purchase to cover the air conditioner unit as it's being delivered to you and as it's being lifted on the crane and installing it into the building you have to insure it before it's because your your your property policy your commercial policy your cpp or bop whatever it will ensure anything that's part of the building but an air conditioning unit that you bought in another state that is being delivered to you and that has to be lifted on a crane and then installed is not covered by your building yet until it becomes a part of your building so until that item is officially part of your building you use an insulation floater to cover it in all my pt tests there was workers compensation which is the 1.5 rating and workers compensation average okay workers compensation is state specific very state specific and every state has very different numbers so i have no idea is my point um 1.5 rating i don't even know what one i don't every state is so weird i will tell you though after that workers comp is not going to make or break you i know that you may like all i remember was workers comp questions that's probably because you don't know it we tend to remember the thing that scares us so a lot of people say i remember all the questions were about workers but all the questions about commercial i'm like no they weren't look at your exam breakdown they can't have possibly have been we only remember the ones that terrify us workers comp is not usually the ones you need to be able to secure a pass so i generally avoid workers comp in general uh michelle options for the question all oh wait oh for the installation platter yeah that was that was something else that was yeah yeah you already answered my question but i do have another question yeah do you see how it's c yeah appliance that will become part of the permanent building that's the insulation i wanted to point that out put the options in the chat box so she asked the question what is the installation floater and then she put the answer choices so if you want to see that the answer is c an appliance that is intended to become part of the permanent building great job okay let me close the scroll red okay if the insurer had known the truth or additional info they would have issued a different policy that is known as kathy that is material they would have made a different decision they would have altered their decision they would have made a different policy a different coverage different whatever so that's material kathy so it's just material i thought there was another word after it it's just called material misrepresentation okay perfect thank you yeah yeah the key word there is material which is altering the material you're altering the material you're making a different decision all right uh michelle what was your other question okay this question right here a tow truck was stolen from the insured's premises the insured has loss of use coverage on his commercial auto policy how much will the insured be able to collect from the coverage if he's unable to use the tow truck in his operation for 40 days i know this is going into commercial but this is messing me all up okay so let's talk about and i i may um this requires memory and not remembering a number and the commercial numbers may be a little bit different than um regular auto numbers i'm going to use regular auto numbers because those are the ones i would encourage you to memorize anyway but i can still answer this question i'm just going to use the auto numbers is saying if if he has a tow truck you know for his business to tow things he is making money every time he tows something right if he cannot use the tow truck because it was stolen that's what the loss of use is and insurance companies will pay for that if your car was if your tow truck because this is a commercial policy that we're talking about if your truck that you use to do business is stolen they will pay you the loss of use to not be able to use that car now um in personal auto in personal auto i know you asked me commercial but in personal audit that's fun when you have um loss of use on your personal auto they're going to call it transportation expenses because in in commercial you're making money so it's loss of use if it's regular auto you can't use your car so you need other transportation so it's called transportation expenses if you have transportation expenses they will pay you money they will pay you twenty dollars a day up to 600 for transportation expenses you got to get a bus ticket you got to get a lift you got to get an uber you get up to 20 a day for a total of 600 max okay so and this is this is countrywide everyone's got the same numbers i've never seen a state that's different 2600 2600 2600 okay so on your personal auto you have transportation expenses if your car is stolen in the repair shop because of an accident as long as it's a valid claim like not oh it broke down you don't get transportation expenses for breakdown it's it's for a claim like crashing or being stolen you get up to twenty dollars a day for a total of six hundred now they have a couple of rules though if the car is stolen which in your example it was you have to wait 48 hours to start collecting your twenty dollars so basically you're saying the first two days of your car being stolen is not covered then after that you get twenty dollars a day so let's say i think you said forty days but let's say that the car was i did gone for a total of one two three four what is this day one day two day three day four day five okay if it was stolen you have to wait 48 hours which is two days then you start earning 20 a day until the car is found whatever so and but but if it was just in an accident if it was just a collision claim so if it's a collision and it's in the repair shop you have to wait um 24 hours so if it's just a collision it's just a crash it's in a repair shop you got to wait 24 hours so again in our case if it was 5 1 day 1 day two day three day four day five you would get no money on day one but then you'd get twenty for day two twenty four day three twenty four day four twenty four day five for a total of 20 40 60 80. so same instance if my car was stolen i would get sixty dollars of t e transportation expenses and if it was in an accident i would get eighty dollars because i only have to subtract one day okay your case for that question i don't know what the commercial numbers are i don't i think it's more than 20 and 600 and i'm not sure if they have the 48 hours in the 24 but i think they do but it might be a little bit less okay i'll double i'll double check that this evening to you yes yes it does makes perfect sense awesome okay thank you in addition to like rental coverage so that's a whole other thing so this is tne which is transportation expenses rental reimbursement allows you to rent a car and they don't really ask about that one very much at all but in order to get rental reimbursement at a minimum you i think you have i think if if they do ever ask about it you have to have both collision and other than collisions you gotta have both coverages to get rental but tne you can get you could you can get they don't require i don't know it doesn't they rarely have ever asked for rental most people have rental on their policy but tne transportation expenses you want to remember the 2600 48 hours stolen 24 hour collision waiting period before you can start collecting your 20 the other one to remember is towing and labor towing in labor this one is 25 per breakdown most most states pretty sure i don't know that i've ever seen another number so if your car breaks down and you've got towing and labor they will pick up to 25 to help with the repair of the tow truck which it was stolen so we can't help you back to that previous example okay um steve i'm in california and how much of the exam includes code and ethics i'm going to make this real lovely for you none of it in california you have a requirement to complete the pnc course and you have a 12-hour ethics requirement the 12-hour ethics will not be included on your exam only what's in your pnc course will be what's on the exam the 12 hour of ethics is just proving that you spent 12 hours reading it it will if if they do ask you a code and ethics question it will be included in your course in your main pnc course so that extra 12 hours of stuff you have to do in california not tested so that's lovely that's nice okay any other questions lasting i just need to make sure i can get the documents that i was afraid to download perfect yes okay so anybody else have any other questions before i help oh oh oh one question yes question yes that's kind of on topic i wanted to know uh a little uh one question about life insurance and and that is um what are the health regulations for insurance in michigan okay wait hang on one second let me um okay thanks okay say that again i missed it because my brain was somewhere else sorry hey i'm sorry i i just got one question kind of topic i don't want to know what was the health regulations for michigan health regulations for michigan are you doing the property and casualty exam yes and there's a health regulations section okay so one one of the things that's cool is when you say regulations i'm thinking state regulations whether you're taking the life and health exam or the property and casualties state law is state law so if you already did like yourself and you already studied state law when you take the property and casualty it'll be the same questions okay okay so it was one of the same okay thank you yes you're welcome okay and then um you guys also asked let me oh no not that oh don't cancel sure oh i stopped sharing okay i'm good okay sorry sorry um you guys asked where to get my stuff so this um right now and i'll put this link in the chat box so right now i am i am i got links all over the place but i'm getting more and more organized as we go on okay and then the boo is helping my number one fan he's helping me get way more organized um excel yes i highly recommend excel richie just said a study for excel if you buy an excel course and use the coupon code queen you will get 10 off and you will get my all access pass which is all past recorded classes for your topic by the way okay so i just put this link in the chat box this is where you can pretty much get everything of mine if you need a study buddy session now angela is fantastic at helping you memorize the things you need to memorize and pumping you up for passing the exam she is a little fierce about it and it and and it either works for you or doesn't but man is she amazing at getting you to remember the things you need to remember if you want to book a session with her you just click this link go to the calendar link um and you're able to book a session with her she does um one on ones for one hour at 59 free game nights every sunday you can get a four hour session with her which i totally recommend if you're gonna go right before your exam like the day before or two days before your exam you want to make sure you lock in everything you could do a four hour session with her for 199 then she has um auto umbrella classes dwelling and general classes available for 29 those are group classes so that's where you can do that um then this is where i have all my stuff so it's not really organized right now i'm working on it but i have um my all access is basically every piece of recording every class that i have taught on that topic all available in one bundle i have the health bundle the life bundle the life and health bundle the property and casualty bundle and then i put all life and health and property casualty into one so if you know you're going to do all four exams instead of paying 111 plus 111 you can pay 155 and get all all the bundles together then i sell things separately i have um if you need help with general insurance i have a an audio that it's not a class it's an audio of me talking and explaining the material i have a memorization one where not only do i explain it but then i repeat the definition three times to lock it into your brain um i got some health class health class live life here is the state law one let me give you guys the link to that one directly so state law is pretty important now with that class um it is state specific everyone's numbers are different but i tell you which numbers to look at how long is your license good for how many continuing education hours you need how often does the director do examinations and then i just explain that chapter in general so it makes a lot more sense so that's the law chapter highly recommend that for anybody and it is included in the all access right um then i've got more life more health whatever life life um this is a great class this one's five hours i did general like we just did i went into homeowners i also did some math um and then i have pnc basics memorization this class is now free on youtube in fact i'm probably going to release one of these classes on youtube since this class will replace one of my other classes um this uh there's a pnc home in insurance that one's now free on youtube too um so yeah this is where you can get all of my classes so i will be including um uh home and auto in this i'll send you the link for that one because you guys um yeah oh and then if you did want to work with me one-on-one like you're like i just want to know that i will pass this exam the first time i want someone to tell me what exactly i need to study how i need to study i want to be able to ask melissa questions as i'm studying throughout the day that's what the royal treatment is for so you literally have you know i mean of course you know during the business days or business hour if i'm sleeping i'm not going to answer you this is what i'm trying to say but we can't call you at midnight or one o'clock in the morning i won't answer it actually it depends on where i'm at what the time zone is right um but anyway if you want to work with me one-on-one knowing that i mean as of right now it is a 100 first time pass so anybody who has worked with me on my royal treatment has passed their exam the first time every time every client so far um so i'm going to send you the link for that that link is not on my um website on that website because i took it off because last month august was my birthday so i took the month of august kind of off in terms of working with one happy birthday thank you happy belated birthday you're welcome okay and then so there's the link to get the um to get to buy me so you buy me i'm your teacher i'm your tutor in your pocket we will i'll tell you exactly what to do um with your quizzes your testing whatever we will meet a few times um you you have the ability to message me um throughout the day i do audio messages so i use either telegram or boxer you say hey i need help with this or can you explain replacement costs to me again or or i don't know what to do so even if you were like i don't know what it is i need to know i don't know what it is i need to ask you you can even you know say that um so that that you know whatever you have the ability to talk to me with that um savannah oh and you don't need to if you're in south carolina you don't need to worry about um commercial you can pass the exam by focusing on general pc basics home auto dwelling state law and then what you learn in home and auto is going to um help you with commercial anyway so naturally through studying home and dwelling you will get questions correct for commercial um steve none of the code and ethics so i already answered i answered that question your the code in ethics is a 12-hour requirement that you read it it's not part of the exam um richie i'm going to buy your life and health course as a refresher oh perfect cool um that's awesome i it's it's um yes it's definitely a refresher of the stuff on the exam but just keep in mind i focus on the exam not necessarily selling insurance um but the way that i do talk does help you communicate with customers a lot more when especially with life and health um if i purchase the 22 state law do i have access right away yes it's not it's a recording so as soon as you buy the state law class you will get a download you download it it's a video file that you will own forever and you could just immediately watch it everything i have is a download there's no time limit on my stuff so you have access to everything my exam is saturday any chance i will get this video an email you are sending it before then um yeah i should because that would be about 48 hours so as soon as this i gotta end the meeting in fact i'm gonna end the recording right now because well unless anybody has a question i go it's weird about recording i'm like people are going to watch this later and it's like they're watching i don't know whatever um yes as soon as the zoom meeting updates and then i get it uploaded i'm actually making it a lot faster now because instead of uploading the entire movie file to podia i just make it as a private unlisted youtube link so it should actually go a little bit faster but i i i'm going to be traveling for the next couple of days we got to go to illinois because uh my boo is getting a surgery um so we need to head down there we're in michigan right now but um i'll be traveling for a few days so my goal is to get you this recording asap so that i don't have to hop back on to my computer okay any other questions thank you oh you're so welcome um and if all of you if you guys don't mind um or wherever it is that you feel if you can leave a review on my google page for the class itself um or if you want to come back and leave the review when you pass your exam whatever it is you want to do it really really helps me out helps me get out there and at some point i also want to be working for insurance companies i need i need those reviews so i just shared the four 100 huh definitely a 100. oh thank you i do have where's the link i'm a five star queen i've only got five stars so i love it okay where's the link at how do i get to that i just put the link in the chat box but if you were to just do it if you were to go to google maps for instance and you type an insurance exam queen you should be able to find it and leave a review that way as well all right michelle we got to get you your notes thank you all right okay all right so michelle and whoever is waiting for the note do you see the link in the chat do you see the chat box well i had it up hold on to some so in the bottom are you recording oh i am let me turn that off