Insurance Glossary
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Absolute Ownership
An explicit right of ownership and possession which is free from any restriction
Absolute Liability
A legal responsibility towards damages that are final and binding and the cause
Acceptance
An event where an insurer accepts an application and issues a policy that will s
Accessory
An addition to a motor vehicle that does not change its performance or structure
Accident And Health Insurance
A policy that insures the policyholder and his/her dependent against injury, ill
Accident And Sickness Insurance
A policy that insures against personal accident and sickness, that include a com
Accident Severity
Sums up the financial worth of the loss incurred in an accident and is used to i
Accident, Hit And Run
An accident leading to injury or death, caused by collision with an unidentified
Accidental Bodily Injury
Injury caused to the body due to an accident
Accidental Death Benefit
If the death of the Insured is caused by an accident, in addition to the insured
Accumulated Stocks Clause
Pertains to the use of the accumulated finished goods stock at a time when the a
Accumulation Period
The duration for which premium payments are made by the annuitant under life ins
Accumulation Units
Refer to units accumulated in a trust by reinvestment of funds or dividends into
Acquisition Cost Factor
Cost incurred by the Insurer for acquisition of business, considered by the Rein
Acquisition Costs
Costs incurred in setting up a new business - Product launch and publicity expen
Act In Force Clause
A clause in relation to statutory liability that accounts for changes in the law
Act Liability With Fire &/Or Theft
A provision that covers a motor vehicle against the Insured's liability along wi
Act Of God Perils
Unforeseen events like earthquakes, floods, storms etc. caused by nature which c
Act Only Policy
Indemnity for the Insured for all motor vehicles as per the limits prescribed in
Actual Total Loss
A loss whereby the property or goods are missing or damaged and cannot be recove
Actuarial Science
The science of risk evaluation, determination of premiums adequate to meet the r
Actuary
A qualified statistician and mathematician who carries out research in order to
Add-Ons
Purchase of additional benefits or cover on the existing policy.
Additional Insured
An entity (person or company) not originally included under the insurance policy
Adjustable Life Insurance
An life insurance policy whereby the policyholder has the right to change any of
Advance Funding
It refers to an upfront payment against a contractual payment due in the future.
Adverse Selection
An adverse situation created in an exposure group when people who believe that t
Age Limit
The qualifying age for an insurance policy.
Agent
A state-licensed, representative, appointed by the insurance company to solicit,
Aggregate Deductible
The total amount that the Insured can attribute as deductibles over a period of
All Risk
An insurance policy that covers every possible claim that has not been specifica
All-Risks Policy
Coverage provided by an insurance policy for all losses except those specificall
Amendment
A change to an existing rule or protocol, provided in writing.
Amortization
This occurs when a debt is paid off in regular portions,over a period of time, b
Annual Statement
An annual report, mandated by the state insurance commissioner, containing the i
Annuitant
Person who receives an income for life or for a period specified in an annuity c
Annuity
Flow of payments made periodically over time.
Annuity Certain
Guaranteed number or amount of payments received under an annuity.
Annuity Consideration
Money paid by a person to an insurance company in return for an instrument that
Antiselection
An instance where an Insurer would not wish to insure a person whose genetic con
Application
A form filled out by the applicant for the purpose of receiving insurance from t
Appraisal
The evaluation of a claim by a person authorized by the company and the policyho
Arbitration
A process of resolving disputes with the aid of an unbiased person or committee
Arson
The burning down of property with a criminal intent.
Assessment Association
An Insurer that retains the right to charge an additional premium to the policyh
Assessment Mutual
An Insurer that retains the right to charge an additional premium to the policyh
Assessor
Also known as the Surveyor, this person determines the estimated value of the go
Assets
An item of property owned by a person or company, regarded as having value and a
Assignment
Transfer of a person's interest in an insurance policy to another person in the
Assumptions
Risk accepted by a Reinsurer.
Assured
Entity indemnified against loss through insurance.
Automatic Reinstatement Clause
An automatic renewal clause included in a property insurance policy whereby on p
Automatic Reinsurance
An arrangement whereby the Reinsurer agrees to take on the risk for a certain ca
Automobile Fleet
Multiple motor vehicles owned by the same person or company, covered by a single
Automobile Liability Insurance
Coverage in the event that you are held legally responsible for injury to anothe
Aviation Insurance
Includes a master policy that covers employees in a company against the dangers
Award
The favourable outcome of an investigation of the facts and evidence by the Insu
Back Office
It is the controlling office that has no direct business but controls and monito
Backlog
This refers to proposals that remain unattended, un-responded references or enqu
Baggage Insurance
This insurance coverage is available to the insured or his or her family and pro
Bank Charges
Banks levy certain types of charges for operating the banking accounts, such as
Bank Guarantee
In insurance industry, bank guarantee refers to the guarantees executed by banks
Bank Reconciliation Statement
The balance according to the bank account in the company’s book must be equal
Bank Transfers
A bank transfer entry needs to be recorded when the insurance company transfers
Bankers Indemnity Policy
This is a specialized policy available for banks and to protects against destruc
Base Premium
This is the amount of premium charged by the direct insurers.
Basic Commission
This is the commission on a reinsurance proportional treaty. This is always appl
Basic Premium
This is the gross amount charged by the insurance company to the policyholder fo
Basic Rate
This represents the rate of premium shown in the Rate Guide or the Insurance Com
Beneficiary
Person(s) or entity/entities named in the insurance policy as the recipient of t
Benefit Of Insurance Clause
A term in the policy document under which the bailee of goods claims benefits th
Benefit Period
Time period (generally between 1 and 3 years) during which any major medical ben
Benefits
This is the amount that the insurance company will have to pay claimants, assign
Blanket Insurance
A health insurance contract covering all classes of people not identifiable indi
Bodily Injury Liability
Liability arising from bodily injury or death of another person.
Boiler & Machinery Insurance
Covers loss arising from the operations of pressure, electrical, and mechanical
Boilers & Machinery Policy
Protection against any loss arising due to accidents related to the pressure ves
Book Of Business
It is the size, number, and type of accounts owned by a particular agent.
Book Value
The purchasing cost after deducting depreciation
Branch Office System
The life insurance marketing system where multiple offices are established in di
Breach Of Condition
Violation of any terms or conditions that have been agreed upon in the insurance
Break In Service
Any calendar year, plan year, or 12 consecutive month period in which a particip
Broker
Marketing expert representing property buyers and liability insurance dealing wi
Builder'S Risk Coverage Form
Commercial property coverage form specially created for buildings under construc
Builder'S Risk Insurance
Insurance protection against any losses to the buildings or structures that are
Bulk Cargo
Cargo that is not packaged and is directly loaded in the vessels' holds.
Bulk Carrier
Consignor of bulk cargo tendering the cargo for transporting to the consignee.
Burglary
Unauthorized or unforeseen entries to or exists from the premises covered under
Burglary And Theft Insurance
Insurance cover provided for property losses arising from robbery, burglary, or
Business Insurance
Insurance policy providing different benefits to businesses and is issued for in
Business Interruption Insurance
Losses arising due to temporary halting and shutdown of business due to fire or
Business Life Insurance
Life insurance availed by a business on the life of any member of the company. O
Buy-Sell Agreement
Agreement between business owners for purchasing the shares of deceased or disab
Causes Of Loss
The various perils that are insured within the insurance plan
Claimant
Person seeking reimbursement for any loss covered under the terms and conditions
Classification Clause (Cargo)
Clause within cargo insurance open coverage that provides details of minimum cla
Clause
Section or para within the insurance policy explaining, clarifying, or defining
Co-Payment
The component (either percentage or fixed amount) of medical bill paid by the pa
Collision Coverage
Protection against physical damage for the policyholders' owned vehicles resulti
Commercial General Liability (Cgl) Coverage Part
General liability cover written as monoline policy or component of commercial pa
Comprehensive Coverage
Physical damage cover for losses resulting due to fire, falling objects, vandali
Comprehensive General Liability Policy
Policy covering different kinds of general liabilities, operations and premises,
Comprehensive Personal Liability Policy (Cpl)
Personal liability contract providing personal liability cover for insured and f
Constructive Total Loss
Partial loss resulting from sufficient degree for making the cost of repair much
Contract Carrier
Transportation company carrying goods for only certain clients and not general p
Contribution
More than one party provides risk cover; each insurer is responsible for protect
Contributory Value
Value on the basis of which contribution towards general loss or salvage compens
Cost Of Pure Risk
Costs related to pure risks, such as those from shareholders perspective, insura
Cost Of Risk
Decrease in the value of business arising due to risks
Cover
Insurance contract; effective insurance, inclusions within the coverage under in
Coverage
Scope of available protection under the insurance contract; any of the several r
Covered
Any individual covered under pension plan fulfilling the eligibility needs withi
Covered Expenses
Medical, hospital, and other related expenses incurred by the insured person ent
Covered Participant
Individual covered under pension plan and has satisfied the eligibility norms of
Dacoity
Robbery by group of people; the Standard Burglary Insurance Policy offered to bu
Damage To Property Of Others
Damages covered to a predetermined amount per occurrence on behalf of the insure
Damages
Monetary compensation provided at law for any civil wrongdoing or breach of a co
Dangerous Or Hazardous Goods
Liquids, solids, or gases that can be harmful to the environment, human beings,
Date Of Issue
Date of issue of the insurance plan; provides evidence of coverage being offered
Dcdrf
District Consumer Disputes Redressal Forum; complaints against insurance compani
Dead Weight
Maximum weight in tons available for cargo, crew, water, fuel, and other stores
Dealer
An authorized agent of manufacturers responsible for sales of manufactured vehic
Death
End of life due to accident; to claim compensation under these circumstances cov
Death Benefit
Payment made to nominee or legal heir of the insured within the Personal Acciden
Death Claim
Any claim lodged within the insurance policy by the beneficiary on the death of
Declaration
Statements within the insurance contract providing information related to the li
Declarations
Various statements within the insurance plan providing information about the lif
Deductible
Proportion of loss borne by the insured towards any claim; two forms; amount of
Deferred Compensation
Arrangements through which compensation for employees for current and past servi
Defined Benefit Plan
Pension policy stating either benefits receivable by the employees on retirement
Dental Insurance
Group or individual plan helping the payment of normal dental service costs as w
Deposit Premium
Deposited premium paid by the potential holder at the time of application to ava
Depreciation
Allowance for reduction in value of property due to deterioration, damage, wear
Direct Loss
Financial losses resulting from directly insured risks
Disability
Any condition curtailing to an extent an individual's capability to carry on her
Disability Benefit
Periodic payments (often monthly) paid to the participants under certain retirem
Disability Income Insurance
Any form of health insurance providing periodic payments for replacing the incom
Disability Insurance
Kind of health plan paying monthly income to the insured person when s/he is una
Disability Insured
Status of any individual insured for receiving disability benefits under Old Age
Disclosure
Duty of the insured individual and his/her broker to provide the underwriter det
Dividend
Return of partial premium within participating insurance reflecting difference b
Domiciliary Hospitalization
Treatment of patient who has been sent home because of lack of accommodation at
E & O.E.
Errors and omissions that are excepted
Early Retirement
Retirement of the participant at a date earlier than the regular retirement date
Earned Income
Employment income earned as salary, wages, fees, or commissions
Earned Premium
earned premium refers to the premium collected by an insurance company for the p
Earned Premium - Reinsurance
Premium ceded and included during the year in question along with the reserve fo
Earthquake Fire And Shock
Extension of the policy coverage to the standard fire and special perils plan by
Earthquake Zone
Differentiating between areas that are prone to earthquakes and those locations
Economic Life
The remaining duration when the property or equipment yields higher returns than
Economic Loss
Estimated loss (insured as well as uninsured) incurred by a person, family, or b
Economic Policy
Special kind of participating whole life plan under which the dividends are used
Economically Vulnerable Or Backward Classes
According to the IRDA guidelines, people who live below the poverty line
Effective Date
Actual date on which insurance coverage comes into force
Efficient Level Of Risk
Amount of risk balance after business or individual pursues activities like inte
Electronic Equipment Insurance
A policy providing coverage from sudden unforeseen material damages to electroni
Elements Of A Negligent Act
The 4 elements injured persons need to show as evidence; existence of legal duty
Eligibility Date
Date on which individual member within a specified group is eligible for applyin
Eligibility Period
Specified length of time (often 31 days) following the eligibility date during w
Eligibility Requirements
Conditions that the employee must satisfy for participating in the retirement pl
Eligible Employees
Members within the group meeting the eligibility requirements under the group he
Embargo
Government prohition (either due to economic or political reasons) towards shipm
Embezzlement
Fraudulent misappropriation or usage of another individual's property or money t
Endorsement
Memorandum issued towards effecting additions, deletions, or alterations in the
Endorsements
Additional paper (not part of the original insurance contract) that cites certai
Endowment
Life insurance that is payable to the policyholder/s if alive on the maturity da
Erection All Risk (Ear)
A plan for covering projects that are under construction; provides coverage to a
Errors And Omissions Insurance
Liability insurance plan providing protection against any losses incurred by cli
Estate
All the assets and liabilities of a deceased individual
Exclusions
Specific circumstances or conditions listed within the policy document for which
F.I.R.
First Information Report lodged with the police authorities in case of theft, ex
F.O.B.
Related to imports and exports contractual sale agreement; the seller has the re
F.O.B. Insurance
Insurance coverage procured by the seller to protect his or her interest on good
Face Amount
Amount stated on the face of the insurance policy payable in the event of death
Failure Of Consideration
Occurs in the event the risk for which insurer has accepted premium fails to att
Fair Market Value
The price at which any service or asset passes from willing seller to willing bu
Fall Or Displacement Of Building Clause
Provision within the standard fire and special perils policy stating all covers
Family Coverage
Property and/or personal insurance where any addition to the insured, her or his
Family Policy
Life insurance policy offering cover to all or several members of the family und
Faulty Design
Terminology related to builders risk insurance; relevant clause when attached to
Feasibility Study
Studies undertaken to determine workability of proposed project due to various f
Fidelity Exclusion
Provision for burglary and money insurance plans that exclude losses resulting f
Fidelity Guarantee Policy
Insurance plan that reimburses employers from losses resulting due to dishonest
Financial Risks
Risks associated solely with finance received or extended; in various forms by a
Financial Underwriting
Method to evaluate results of reinsurance treaty whereby factors like loss or ga
Finished Goods
Goods or products that are completely manufactured, built, assembled and ready f
Fire
Combustion accompanied by glow or flame escaping the normal confines to cause da
Fire & Theft Risks
Related to motor insurance it refers to restricted coverage provided to a vehicl
Fire And Allied Perils
Term that conventionally is used for denoting additional perils with fire; light
Fire Brigade
Group of special professionals trained in extinguishing fires
Fire Engine
Motor truck equipped with pipes and water tank to spray chemicals and water on f
Fire Extinguisher
Instrument using non-combustible substances such as carbon dioxide for putting o
Fire Hazards
Chemical or physical properties of any matter in whatever state that makes it su
Fire Insurance
Insurance contract indemnifying insured for losses caused due to destruction of
First Named Insured
First named insured on the commercial plans; latest forms allow the insurer to s
First Party Claim
Claims made by the policy holder to her/his own insurance service provider; cont
Floater Policy
Policy under terms of which protection follows moveable properties, covering whe
Franchise
Provision within freight insurance conditions exempting insurer from particular
Freight
Goods moved on behalf of another; remuneration earned by vessel owner or manager
Gainful Employment
Related to permanent total disability under personal accident insurance policy;
General Exclusion Clause
Clause in the Institute Cargo Clauses 1982 that specifies the excluded risks irr
Good Faith
Basic insurance principle, assured and her/his broker must disclose and truly re
Goods
Merchandise excluding personal effects and/or provisions and stores that are use
Goods Carriage
Motor vehicle constructed or adapted for the sole use of carrying goods; any oth
Goods In Trust Or On Commission
Person holding property of another in trust or commission possesses deemed insur
Grace Period
Specified period after the premium due date during which the insured can pay the
Grievous Injury
Injury endangering life of an individual or causing the sufferer severe bodily a
Gross Domestic Product
Measurement of value of all the goods and services produced and delivered during
Gross Negligence
Reckless action without paying any heed to the possible consequences
Gross Net Premium Income
Companies that protect the net account through XL coverage, the premium in the a
Gross Premium
Premium paid by the policyholders
Gross Profit
Sum insured related to consequent loss policy based on the gross profit; represe
Gross Vehicle Weight
Total weight of the vehicle and load registered and certified by the Registering
Ground
Includes all periods during which the aircraft is not flying, moored, or taxying
Group Annuity
Pension plan offering annuities on retirement to group of people under a master
Group Discount
Discount on the premium as per the prospectus or manual rates depending on the n
Group Insurance
Insurance cover for group of individuals who are engaged in common activity; emp
Group Life Insurance
Life insurance cover without medical examination on group of individuals under a
Group Mediclaim Insurance
Medical cover issued in favor of an enterprise or organization or employer for c
Group Personal Accident Insurance
Personal accident cover issued in favor of an enterprise or organization or empl
Group Term Life Insurance
Commonest form of group life insurance; annual renewable term insurance for empl
Growth Rate
Percentage change in the quantum of business compared to the base year; growth r
Hand Appliances
Any portable fire extinguisher device comprising chemicals to put out fires. Han
Hazard
Condition/s that create or enhance the risks of losses due to any perils
Hazardous Goods
Goods (either solids, liquids, or gases) susceptible to the risk of fire in diff
Hazardous Risks (Fidelity Guarantee Insurance)
Risks not considered as good for insurance because high hazards associated there
Hazardous Sports
Related to personal accident plans, sport activities that have higher risks like
Hazardous Substance
Related to Public Liability Insurance Act 1991 meaning list of chemicals with ca
Health Insurance
Protection from financial losses due to accidental bodily injury or illness; var
Health Insurance Business Or Health Cover
Contractual effecting providing sickness benefits or surgical, hospital expense
Heavy Industry
Traditional production companies in the steel, petroleum, automobile, rubber, an
Hedging
Importers or exporters strategy related to future sales or purchases; for overco
Hit And Run Motor Accident
Accident that arises from the use of motor vehicle/s where the identity is not c
Hold-Up
Robbery involving violence or threat of violence; risk that is covered under the
Hospital Expense Insurance
Health insurance cover offering protection against hospital care cost resulting
Hospital Medical Insurance
Protection offering benefits for the cost of all or some of the several healthca
Hospital Miscellaneous Services
Services excluding room, board, and general nursing services offered by hospital
Hospitalisation
Admission of the patient in nursing home or hospital for treating injury, diseas
Hospitalisation Insurance
Insurance cover for individuals offering reimbursement of the expenditure incurr
Housebreaking
Individuals commit house breaking when they trespass and their entries affect th
Householders Comprehensive Insurance
Insurance package designed for homeowners with broad range of liability and prop
Hull Insurance
Insurance on the vessel, and its equipment and machinery
Human Life Value
Present value of the family's share of the deceased earner's future earning pote
Hurricane
Tropical storms marked by very low barometric pressure and circular winds at vel
Hurricane Insurance
Component of the perils named 'storm, inundation, cyclone, flood, typhoon, torna
Jewellers Block Policy
Insurance plans for jewellers needs; cover is available for stock-in-trade at th
Joint Life Policy
Pays the insurance amount when the first of two or more insured individuals pass
Judgement
Court determinations for completed jurisdiction on various submitted matters
Key Person Health Insurance
Individual or group policy designed for protecting company against loss of incom
Key-Person Insurance
Insurance cover designed for offering coverage to protect business firms against
Kidnap-Ransom Insurance
Insurance cover available for providing payment within the specified time period
Kutcha Construction
Buildings with walls and/or wooden planks, grass, bamboo, hay, plastic cloth, th
Lapsed Policy
Insurance cover that has closed earlier to the actual expiration date because of
Lead Insurer
The insurer out of the insuring party having agreed to underwrite the highest sh
Lease
Contract where the owner of any fixed assets allows its use to the contracting p
Legal Liability
Liability that is enforceable under existing laws or acts
Lessee (Leasee)
Party in whose favor lease is granted
Lessor
Party that grants the lease to the leasee
Liability Insurance
Insurance cover for protecting policy holder from financial losses due to any li
License
Legal authority provided to the companies, brokers, agents, or consultants for t
License Fee
Amount paid by insurers or other companies or individuals as determined by the r
Lien
Legal right of an individual on the property of another until the latter has sat
Life Annuity
Series of payments when commence are continued for the entire life duration of t
Life Annuity With 10 Years Certain
Annuity paying income to annuitant for as long as s/he survives; but if demise o
Life Expectancy
Average number of years of living remaining for group of persons of any given ag
Life Insurance
Insurance cover providing payments for specified amount on the demise of the ins
Life Policy For 2 Wheelers
Insurance coverage for 2 wheelers covering 3rd party risks and being valid until
Lift (3Rd Party Liability) Insurance
Insurance plan for owners of passenger lifts for taking liabilities arising from
Light Motor Vehicle (Lmv)
Transport vehicle or omnibus whose gross vehicle weight of either tractor, motor
Lightning
Flash of light in the sky caused due to atmospheric electricity discharge from o
Limited Payment Life Insurance
Whole life insurance coverage where premiums are payable for specified number of
Limited Policy
Contract covering only certain kinds of accidents or diseases
Liquidation
Dissolving a firm through sale of assets for cash
Listed Companies
Companies whose shares are listed on stock exchanges for trading; respective sto
Loading
Amount that needs to be added to pure premium for profit, expenses, and continge
Machinery Breakdown Insurance (Machinery Insurance)
Insurance cover for plant and machinery providing protection against all types o
Mailing List
Compilation of probable clients prepared as a list that can be used for solicita
Major Medical Expense Insurance
Form of health insurance policy providing benefits for most kinds of medical exp
Malicious Damage
Deliberate damage or destruction of insured property or any part of it by wrongf
Malpractice
Improper conduct of professionals during performance of his or her duties either
Malpractice Insurance
Cover for professionals like lawyers or doctors against liability claims resulti
Manuscript Policy
Plan developed for meeting the specific requirements and needs of the company
Marine 50/50 Clause
A clause in project insurance plans where marine is not insured by the same comp
Marine Adventure
Voyage or time period when the cargo is exposed to the various maritime risks
Marine Cargo Insurance Policy
Insurance related to merchandise and/or goods in transit from one location to an
Marine Clause
Clause appearing as one of the general conditions within the standard fire and s
Marine Hull Insurance
Insurance offered to ocean going steamers and other ships; hull insurance offers
Marine Insurance
Related to insurance of goods in transit from one destination to another by sea,
Maritime Fraud
Occurs when one or more of several parties in any transaction connected with mar
Market Price (Or Market Value)
Rate at which security can be sold or brought at any particular period in time
Market Value
Value determined for similar property that could be sold or purchased in the loc
Marketing
Procedure for optimizing use of various resources of an enterprise by trying to
Master Policy (Or Master Contract)
Policy issued to group holders settling the provisions of the group insurance co
Material Damage
Physical damage to tangible property, such as stocks, building, automobiles, fur
Material Fact
Fact/s that will influence the judgment of any prudent insurance company in dete
Material Mis-Representation
Misrepresentation of certain facts that will influence the judgment of the insur
Material Representation
Representation to the insurance company that would affect the acceptance of risk
Medical Examination
Examination given by qualified physicians for determining insurability of applic
Medical Expense Insurance
Form of health insurance plan providing benefits for expenditures incurred for m
Medical Malpractice
Inaccurate treatment or care by medical professional, hospital, or other healthc
Medical Payments Insurance
Cover available in different liability insurance plans where the insurance provi
Medicare
Program of hospital insurance (part A) and supplementary medical insurance (part
Misrepresentation
Incorrect statement made about material fact/s if made deliberately with an inte
Mode Of Premium Payment
Frequency of payment of premiums, can be monthly, quarterly, half yearly, or ann
Moral Hazard
Hazard resulting from any non-physical personal feature of a risk that increases
Mortality Table
Table showing number of members in a group commencing at certain age will be ali
Mortgage Insurance
Life insurance plan paying balance of the mortgage amount in case of death of th
Motor Truck Cargo - Owner'S Form
Form of insurance insuring truck owner/s against loss to his personal property o
Motor Truck Cargo - Trucker'S Form
This kind indemnifies the policyholder/s (trucker) for damage or loss resulting
Mysterious Disappearance
Disappearance of insured property in an unexplained and mysterious manner
Named Perils Policy
Policy where the perils against which cover is granted is listed; insurer is lia
National Wealth
Sum total of the value of the entire capital and goods available in a country
Nationality Of Vessel
Nationality of vessel is critical to the insurance company especially when the s
Natural Losses
Damages or loss caused due to natural vagaries like hurricane, storm, earthquake
Navigational Limits
Limits prescribed by the Port Authorities and Director General of Shipping with
Ncdrc
National Consumer Disputes Redressal Commission; complaints can be filed with NC
Negligence
Failure of using reasonable care adopted by prudent individuals under similar co
Negotiated Settlement
Claim settlement reached after compromising in cases where dispute with relation
Neon Sign Insurance
Insurance cover for damages or loss to neon sign installations by any external a
Net Loss
Residual loss to the insured after considering realization from salvage and/or r
Net Premium
Portion of the premium that is designed to provide coverage for benefits or loss
Net Retained Line Clause
Clause that is applicable to excess of loss reinsurance coverage that refers to
Net Retained Lines
Related to excess of loss reinsurance treaties is provision that the contract is
Net Retention
Capacity that insurance companies put forth for retaining risks to its own accou
Net Tonnage
Cargo and/or passenger accommodation expressed in terms of cubic measurements de
New Attachments
Acquisition of new vessels to existing fleet; rate of premium of these new asset
New Business Clause
Special clause included to specification in loss of profit insurance plan; when
No Claim Bonus
Reduction as a percent in the manual or prospectus premium while renewing the po
No Cure, No Pay
Terminology used with relation to salvage operations of cargo or vessel in distr
No Fault Liability
Claimant does not require proving that injury, death, or damage has occurred due
Nominee
Institution, firm, or individual mentioned in accident insurance plans to be the
Non Fare Paying Passengers
Provision within motor insurance commercial vehicles plans for covering in respe
Non Hazardous
Physical or chemical properties of matter in whichever state that presents no un
Nonassignable Policy
Insurance plan that cannot be assigned by an insured to any other person; normal
Non-Concurrent Policies
Two or more insurance plans that cover portion of the property covered by other
Named Perils
Coverage within property insurance providing protection against loss from perils
National Association Of Insurance Commissioners (Naic)
Association of insurance commissioners in different states for promoting nationa
Noncancellable
Contract that insured has to continue through timely premium payments as set for
Nonconfining Sickness
Illness that disables the covered individual but does not confine her or him to
Noncontributory
Term applicable to employee benefit plans whereby the employers bears full cost
Nondisabling Injury
Injury that may need medical care but does not result in loss of income due to l
Nondisabling Injury Benefit
Benefit within certain disability income plans offering payment of medical expen
Nonforfeiture Option
One of the options available in case the holder discontinues paying the premium
Nonmedical Limit
Maximum face value of insurance plan that a firm will issue without having the a
Nonoccupational Policy
Contract that insures an individual against off-the-job illness or accident; doe
Nonparticipating Policy
Life insurance plan where the organization does not distribute any portion of it
Notice Of Loss
Written notice of losses incurred by insurance companies as stipulated in the co
Obsolescence
Procedure whereby the property becomes unusable not due to physical deterioratio
Occupancy And Fire Rates
Direct relation between use of premises that it is put to and the possibility of
Occupational Disease
Disease contracted due to exposure to certain harmful conditions on the job; cov
Occupational Hazards
Occupations that expose the insured to physical damage that is larger than norma
Occurrence
Event resulting in bodily injury or property damage to any third party; for liab
Occurrence Basis Policy
Liability insurance plan covering claims that arise due to any event/s during th
Occurrence Limit
Maximum liability of the insurance company of all claims that are related to the
Off Duty Covers
Personal accident insurance coverage for individuals during restricted hours whe
Open Cover
Agreement where the assured undertakes to declare each item that is within the s
Operating Ratio
Sum of expenditures and losses expressed as certain percentage of the earned pre
Ordinary Life
Same as straight or whole life; terms are applicable to policies that continue d
Obligee
Any person in whose favor an obligation runs; term is often used in surety bonds
Obligor
Also known as principal, an individual bound by obligation; under bond strictly
Occupancy
Type and character of the usage of the property in discussion
Overage
Additional chargeable premium on cargo open cover declaration due to the carryin
Quarantine Restrictions
According to carriage of goods by sea act, carrier does not have the responsibil
Quarrels And Arbitration
Arbitration clause provides the mechanism that must be followed for settlement o
Quid Pro Quo
Insurance company selling policy to some person for consideration of premium pai
Quota Share Cum Surplus Treaty
Proportional treaty arrangement mechanism combining quota share and surplus trea
Quota Share Pools
Market pools arranged on the quota share principle where the participating compa
Quota Share Treaty
An agreement where the ceding company is bound to cede and the reinsurance compa
Qualification Period
Period during when the insured should totally be disabled prior to being eligibl
Qualified Impairment Insurance
Kind of substandard or special class insurance that restricts benefits for insur
Qualified Plan
Plan that the IRS approves as meeting the requirements of Section 401 (a) of the
Ratable Proportion Of Loss
Treating claim for loss that is insured under more than single policy; in such i
Rate Guide
Company prospectus or manual providing rates of premium for different kinds of i
Rate Of Premium
Pricing factor on which payable premium for particular kind of insurance cover i
Rate Per Mille
Premium rate calculated for every thousand rupees of sum assured
Repatriation Benefits (Under Overseas Mediclaim)
Coverage for medical necessity for evacuating to medical facility, medically equ
Risk Management
Procedure to identify, analyze, and either accept or mitigate uncertainty
Rated Policy
Also known as extra risk policy is a plan issued at higher than the standard rat
Reinstatement
Resumption of the cover under an insurance policy that has lapsed
Replacement Cost
Cost for repairing or replacing property at construction costs prevailing when l
Rating Territory
Geographical grouping where hazards tend to equalize and permit the establishmen
Rebating
Providing valuable consideration often all or some part of the commission to the
Recurring Claim Provision
Provision within health insurance plan that specifies the period of time during
Rehabilitation
Restoration of fully disabled individual to meaningful occupation; provision in
Reimbursement
Payment of expense actually incurred as a result of an illness or accident but n
Reinsurance
Assuming all or part of the risk undertaken by one insurance company by another
Renewable Term Insurance
Term insurance that is renewable at the end of the term at the option of the hol
Renewal
Continuance of the cover under an insurance policy beyond the original term thro
Replacement
Substitution of health insurance cover from one policy contract to another
Replacement Ratio
Percent of income prior to retirement that is needed for replacing for maintenan
Representation
Statements made by applicants whereby they represent as being substantially true
Rescission
Termination of insurance contract by insurance provider on the basis of material
Reserve
Amount representing liabilities kept by an insurer for providing further commitm
Residual Disability
Period of partial disability that immediately following a period of complete dis
Residual Disability Benefits
Provision in insurance plan providing benefits in proportion to the decrease of
Retention
Amount of risk that is retained by the insurance company for its own account or
Retrospective Date
First date for which the claims are paid under claims-made policy of liability i
Retrospective Rating
Rating procedure that allows adjusting the insured's final rate depending on the
Revocable Trust
Trust that can be terminated or revoked by the creator/s
Rider
Document that modifies the policy; can increase or reduce the benefits, waive an
Right Of Survivorship
At the demise of one of the co-owner of the property that person's interest in t
Risk Classification
Process through which company decides how the premium rates for life insurance m
Risk Control
Any conscious action that aims to lower the severity, frequency, or unpredictabi
Risk Retention Group
Alternative insurance form whereby members of similar profession or business com
Robbery
Taking of property from an individual through force or threat of violence
Rollover
Transfer of the IRA or any other qualified pension fund from one institution to
Recovery
Amount recovered from 3rd party/parties responsible for the loss on which the cl
Rebate
Reduction in the amount of the premium
Replacement Clause
Clause that limits the liability of the underwriter for damage to machinery carg
Reporting Form
Fire or direct damage cover written under policy covering fluctuating values of
Retroactive Date
Date on "claims made" liability insurance plan that triggers at the commencement
Sabotage
Destruction of productive capabilities in factory or plant by those opposed to m
Safely Landed
Related to marine cargo insurance; goods are safely landed when these have been
Safety Audits
System bringing together various methods to perception of risk and identificatio
Said To Contain
Finding place in receipts given by all carriers in connection to entrusted goods
Sailing Vessels
Country crafts propelled by wind power; either wooden or steel used for carrying
Sale Contract
Contract by which the seller and the buyer agree to the various terms and condit
Sale Of Vessel Clause
Provision within institute hull clause providing automatic cancellation of polic
Salvage
Property partially saved from damage or loss; compensation paid for delivering s
Salvage Charges
Cost incurred by 3rd parties independent of any contractual agreement towards sa
Self-Insurance
Assuming financial risks instead of paying an insurance provider to assume these
Short Term Coverage
Available for a maximum period of 6 months, short term coverage is used for proc
Short Period Policies
Policy that is written for a period that is shorter than the average term
Subrogation
Legal procedure whereby insurance company after paying for the losses can seek r
Self-Insured Retention
Amount in liability insurance plan the insured needs to pay prior to the insuran
Salvage Loss
Occurs when the underwriter agrees for settling cargo claim by paying the differ
Schedule
List of amounts payable for surgical procedures, dismemberment, and ancillary co
Schedule Of Loss
Notice completed by the assured documenting the damage or loss to personal prope
Short-Rate
Cancelling insurance contract at the behest of the insured with refund of premiu
Solvency
Adequate income and assets; primary responsibility of state insurance department
Subrogation Waiver
Waiver named by the insured for giving up right of recovery against another part
Surety
Describes business or bonds or surety ship; is an arrangement where one party is
Surety Bond
Bond where the surety agrees to answer to the obligee for any non-performance of
Tare
Weightage of the packing in consignments or unlade weight in containers or vehic
Tariff Rate
Rate determined by tariff committee for specific property/properties and against
Tax Token
Token issued by the RTO for having paid the required tax/es for the vehicle/s; s
Temporary Total Disablement
Injuries or illnesses that prevent an individual from doing his/her normal dutie
Theft
Any act of stealing
Third Party
Claimant under liability policy; because person making the claim is not among th
Tort
Legal term implying wrongful act due to injury or damage on which civil court ac
Treaty
Agreement between reinsurance provider and ceding insurer outlining the details
Taxable Estate
Value on which estate taxes are calculated by federal government
Temporary Life Annuity
Annuity payable while the annuitant is alive but not beyond a specific period of
Tenants In Common
Kind of joint property ownership whereby the owners may have unequal shares and
Ten Day Free Look
Notice on the first page of health plans providing the insured 10 days during wh
Term Insurance
Insurance payable to beneficiary only in case of the demise of the insured durin
Third-Party Over Suit
Lawsuit where the 3rd party tries recovering damages assessed against the party
Threshold (No-Fault)
Point measured time, money, or other methods that are beyond tort liability that
Tornado
Whirling wind over land mass accompanied by funnel-shaped cloud; is often violen
Total Disability
Injury or illness that prevents an insured individual from constantly performing
Transferability
Arrangement whereby the accumulated benefit credits of the terminating participa
Trust
Legal instrument allowing one party the control of the property for the advantag
Turnover Rate
Rate at which the employees terminate services except due to retirement or demis
Tail
Exposure existing post expiration of the plan and coverage that is purchased for
Total Loss
Can be actual total loss or constructive total loss whereby the cost of damage r
Transit Clause
Clause in the Institute Cargo Classes that specify attachment and termination of
Unallocated Benefit
Policy provision offering reimbursement to a maximum amount for the cost of all
Underinsurance
Inadequate insurance cover related to the insured property; results in claim adm
Underlying Limit
Used in excess of loss treaty/treaties and specifies the limit to which ceding c
Underwriter
An insurer or official in the insurance company with the primary responsibility
Underwriting
Procedure of examination of the proposal, arranging risks inspection/s, fixing r
Underwriting Loss
Shortfall resulting post the payment of claims and expenditures against the rece
Uninsuradle Risk
Risk that is not acceptable for insurance coverage due to its extensiveness
Unearned Premium
Portion of premium that an organization has collected but still needs to be earn
Unified Credit
Single time credit available to every person's estate; credit is also useable fo
Uniform Premium
Rating structure whereby single premium is applicable to all insureds irrespecti
Uniform Provisions
Statutory policy provision/s in health insurance plans that specify some rights
Universal Life Insurance
Flexible premium on life insurance plan whereby the policyholder may modify deat
Umbrella Liability Policy
Liability insurance plan providing liability protection beyond and above what is
Valued Policy
Insurance contracts whereby sum insured related to insured property is deemed to
Variable Expenses
Expenses that vary in relation to the quantum of production or turnover volume;
Variable Quota Share Treaty
In quota share treaty, there may be retention with certain maximum for example 2
Vehicles Subject To Hypothecation Agreement
It is not permissible for insurance companies to issue policies in joint names o
Vehicles Subject To Lease Agreement
Insurance cover cannot be issued in the joint names of lessor and leasee; polici
Void Contract
Agreement that is not enforceable by law
Voibadle Contract
Agreement that can be enforced by law at the option of one or more of the contra
Void Policy
One that is inadmissible as evidence in the court of law
Wagering Contracts
Marine insurance contracts whereby the insured has no insurable interest in the
Waiting Period
Time mentioned as "waiting period" in the insurance contract during when any los
Waiver
Voluntary relinquishment of any known right; may arise when an individual knowin
War Risks Time Policy
Scheme by the Indian Government for insuring Indian hulls against risks due to s
Warehouse To Warehouse Cover
Voyage through which the cargo to be moved begins from seller warehouse and term
Warehouse-Keepers
Organizations or individuals that receive goods for the purpose of storage in th
Warranted Underdeck
Incorporated in marine insurance policies giving a promise or undertaking by the
Warranty
Undertaking by the assured stating that something will be done; certain state of
Waiver Of Premium
Provision within some insurance policies for relieving the insured of premium pa
Whole Life Insurance
Life insurance payable to beneficiary/beneficiaries on the demise of the assured
Will
Legal statement of an individual's wishes concerning the disposal of her or his
Workers Compensation
System established under state laws providing payments without regarding fault t
Waterborne Agreement
Market understanding where the underwriters cover goods against risks due to war
Without Prejudice
Claim paid on the occasion; although the insurer feels it does not attach the pl
Yield
Ratio of the income earned on an investment to the face value of the investment;
Zone A
Relating to application of the premium rates prescribed within the All India Mot
Zone B
Relating to application of the premium rates prescribed within the All India Mot