Collateral damage contracts

• US 20110077978A1
• Filed: 12/02/2010
• Published: 03/31/2011
• Est. Priority Date: 09/16/2002
• Status: Active Grant

• Current Assignee: Bruce Bradford Thomas, Lester Ware Preston
• Original Assignee: Bruce Bradford Thomas, Lester Ware Preston
• Inventors: Thomas, Bruce Bradford, Preston, Lester Ware
• Granted Patent: US 8,271,306 B2
• Time in Patent Office: Days
• US Class Current: 705/4
• CPC Class Codes: G06Q 30/0216 Investment accounts
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

A method for marketing, underwriting, and providing coverage for damages that are associated with insured loss events but that are not covered by traditional insurance policies. This method permits the marketing of loss expense coverage, underwriting, and claim adjustment processes of insurance to be performed by reference to the loss payments that are made by a specified insurance policy. By referencing insured loss payments, which both a buyer and a seller understand, this method provides an easy way to communicate and transact something that is otherwise difficult or impossible to define or measure.

Claims

1. An information system, comprising:

a data storage device; and

a computer linked to the data storage device configured to;

receive and store a standardized contract wording for a Collateral Damage Coverage agreement that includes contractual terms that are acceptable to a coverage seller and will be offered to coverage buyers, where the contractual terms define the conditions for making a payment under the Collateral Damage Coverage agreement and include and at least one acceptable payment function that when applied to losses paid under a referenced insurance policy results in a payment that increases as losses paid under the referenced policy increase;

receive contractual terms for a Collateral Damage Coverage agreement that are acceptable to the coverage seller, where the contractual terms include a specified referenced insurance policy; and

generate a contractual provision for the Collateral Damage Coverage agreement that specifies the acceptable payment function that will be applied to the losses paid by the specified referenced insurance policy and incorporate it into the standardized contract wording.

2. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement by specifying that the payment function will be a percentage of the losses paid under the specified referenced insurance policy.

3. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement by specifying that the payment function will be a non-linear function of the losses paid under the specified referenced insurance policy.

4. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement by specifying that a quantitative limitation will be imposed on the losses paid by the specified referenced insurance policy before the payment function is applied.

5. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement by specifying that a qualitative limitation will be imposed on the losses paid by the specified referenced insurance policy before the payment function is applied.

6. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement based on an all risk commercial property policy that serves as the specified referenced insurance policy.

7. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement based on a commercial casualty policy that serves as the specified referenced insurance policy.

8. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement based on a personal insurance policy that serves as the specified referenced insurance policy.

9. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement based on a health insurance policy that serves as the specified referenced insurance policy.

10. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement based on a workers'"'"' compensation insurance policy that serves as the specified referenced insurance policy.

11. The information system of claim 1, where the computer generates the contractual provision for the Collateral Damage Coverage agreement based on a disability insurance policy that serves as the specified referenced insurance policy.

12. A computer-implemented method operative for constructing contractual wording for Collateral Damage Coverage comprising the steps of:

receiving and storing, in a data storage device linked to a computer, a standardized contract wording for a Collateral Damage Coverage agreement that includes contractual terms that are acceptable to a coverage seller and will be offered to coverage buyers, where the contractual terms define the conditions for making a payment under the Collateral Damage Coverage agreement and include at least one acceptable payment function that when applied to losses paid under a referenced insurance policy results in a payment that increases as losses paid under the referenced insurance policy increase;

receiving and storing, in the data storage device linked to the computer, contractual terms for a Collateral Damage Coverage agreement that are acceptable to the coverage seller, where the contractual terms include a specified referenced insurance policy; and

using the computer to generate a contractual provision for the Collateral Damage Coverage agreement that specifies the payment by applying the acceptable payment function to the losses paid by the specified referenced insurance policy and incorporating it into the standardized contract wording.

13. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision specifies that the payment function will be a percentage of the losses paid under the specified referenced insurance policy.

14. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision specifies that the payment function will be a non-linear function of the losses paid under the specified referenced insurance policy.

15. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision specifies that a quantitative limitation will be imposed on the losses paid by the specified referenced insurance policy before the payment function is applied.

16. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision specifies that a qualitative limitation will be imposed on the losses paid by the specified referenced insurance policy before the payment function is applied.

17. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision is based on an all risk commercial property insurance policy that serves as the specified referenced insurance policy.

18. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision is based on a commercial casualty insurance policy that serves as the specified referenced insurance policy.

19. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision is based on a personal insurance policy that serves as the specified referenced insurance policy.

20. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision is based on a health insurance policy that serves as the specified referenced insurance policy.

21. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision is based on a workers'"'"' compensation insurance policy that serves as the specified referenced insurance policy.

22. The computer-implemented method of claim 12, where the computer is used to generate the contractual provision for the Collateral Damage Coverage agreement and said contractual provision is based on a disability insurance policy that serves as the specified referenced insurance policy.