A provision in many new policies which will allow the policy owner to receive a portion of the death benefit early if the insured person is diagnosed with a terminal illness or permanently confined to a nursing home.
Accidental Death Benefit-
A rider added to a policy that provides an additional benefit if the insured dies from accidental causes.
A unplanned, sudden, unexpected or unintentional event which occurs suddenly ans at a definite place resulting in injury and/or damage.
The rate of the occurrence of accidents, often expressed in terms of the number of accidents over a period of time. It is one method used to measure the effectiveness of loss control services.
A measure of the severity of seriousness of losses, rather than the number of losses. It is measured in terms of time lost from work rather than the number of individual accidents. It is another way of measuring the effectiveness of loss control services.
Accounts Receivable Coverage-
Pays for the cost of replacing or restoring your accounts receivable records if they're damaged by fire, windstorm, vandalism or any other covered incident. It also may pay for amounts due from your customers that you are unable to collect, subject to the policy limits.
Actual Cash Value-
There are two ways to calculate the value of your property. Actual cash value means how much your property would be worth in the marketplace, taking into account wear and tear on the property since the time you bought it. The other method of calculating the value of your property ? replacement cost value ? is the full amount necessary to replace your property with something of like kind and quality. Replacement cost value does not take into account the wear and tear your property has sustained since you bought it.
Your business can incur liability from advertising and associated activities. Advertising liability includes publishing information that is inaccurate, slanders or libels someone; violates their right of privacy; copies their advertising ideas or style of doing business; or infringes on their copyright, title or slogan.
A type of policy limit in liability policies that restricts coverage to a specific sum for covered losses that occur during the policy period.
One who solicits, negotiates or effects contracts of insurance on behalf of an insurer and the insured. His or her right to exercise various functions, his or her authority, and his or her obligations and the obligations of the insurer to the agent are subject to the terms of the agency contract with the insurer, to statutory law, and to common law.
A certificate of authority from the state which permits the agent to conduct business.
A form on which the prospective insured states facts requested by the insurer on the basis of which, together with information from other sources, the insurer decides whether to accept the risk, modify the coverage offered, or decline the risk.
A verification of the books or similar accounts as they relate to payroll or remuneration to determine their accuracy. Workers? compensation policies are written on a reporting or auditable basis. This gives the insurance company the right to audit the policyholder?s records to verify the accuracy of the earned premiums.
An individual who has the responsibility to review an audit before billing. The reviewer examines the audit for conformity to the policy contract, manual rules, regulatory agency rules and company rules in order to ensure the proper invoicing of earned premiums.
A policy in which the exposure basis is a variable (such as sales, payroll, etc.) which can only be determined at the end of the policy term. Workers? compensation policies are auditable based on payroll.
A land motor vehicle, trailer or semi-trailer designed for travel on public roads, including attached machinery or equipment, but excluding mobile equipment. Mobile equipment is land vehicles that are not required to have motor vehicle registration.
A property protection device to prevent damage by fire. The sprinkler head is made of a substance that melts at a low temperature and releases a spray of water or dry chemicals to extinguish or control the fire.Some insurers discount property insurance rates if your business has automatic sprinklers.
Automobile Collision Coverage-
Covers damage to your vehicle from an accident involving another vehicle or a stationary object such as a building, telephone pole or guardrail.
Automobile Comprehensive Coverage-
Covers physical damage to your vehicle caused by a variety of risks, including fire, lightning, theft, vandalism, hail or flood, but not caused by a collision.
Automobile Liability Insurance-
Protects your business against loss if someone claims that you or someone driving your car with permission is legally liable for injuring a third party or causing property damage.
Average Weekly Earnings-
The average earnings per week of an employee over a fixed period of time. The time is based on last pay raise, hours worked, permanency of employment, etc.
This coverage is used to insure against loss to property of others that is in your possession, regardless of your legal liability. It is needed since standard Property and General Liability policies limit or exclude exposures of this kind.
The financial reimbursement and other services provided under the terms of an insurance contract.
A document you can use to show evidence of your insurance coverage until you receive your insurance policy. If you have a valid binder you are insured.
Coverage under a single amount of insurance for two or more properties or exposures.
Bodily Injury Liability-
Liability for injury or death of someone (other than you or your employee), including the cost of care, loss of services and/or restitution for death.
Boiler and Machinery Insurance-
Protects your business in case of the sudden and accidental breakdown of your boilers, machinery, electrical equipment and mechanical equipment. Sometimes these items are excluded from standard property insurance policies.
Brands and Label Coverage-
Pays for the cost of removing the brands and labels from your damaged stock so it can be salvaged.
A person who, for compensation and on behalf of another person, transacts insurance other than life with, but not on behalf of, an insurer. A broker must file a bond with the Department of Insurance.
Builder's Risk Coverage-
Insures your commercial buildings under construction against damage from fire, windstorm, theft and other exposures. The coverage also applies to property and building materials while in transit and during temporary storage. The coverage may apply to a single location or may be written to cover multiple locations.
Protection against physical loss or damage to your building and other structures at the same location due to fire and other covered incidents, to the policy limit.
Breaking and entering into someone else?s property with the intent of committing a crime and with visible signs of forced entry.
Burglary and Theft Insurance-
Protects you from property losses due to burglary, theft or larceny.
Business Income Coverage-
Reimburses your business for loss of income as a result of direct physical damage to your property.
Business Income/Business Interruption/Extra Expense Coverage-
Reimburses your business for lost profits, fixed expenses and the cost of restoring operations if the business has to shut down due to property damage. Reimbursement is usually up to a year following the covered loss. Examples of extra expenses include renting equipment or another office space.
Business Owner's Policy (BOP)-
A single policy that combines protection for both property (buildings, personal property, business interruption/extra expense) and general liability coverages. Buying a BOP can be a good deal for a business owner. The policies often provide more complete coverage at a lower price than separate policies would for each kind of coverage.
Business Personal Property Coverage-
Protects you against physical loss or damage to your business' equipment, stock, furniture, fixtures, and/or improvements caused by a fire or other covered incident, to the policy limit.
The termination of a policy before its specified expiration date by the insurer or insured in accordance with the provisions of the contract or by mutual agreement.
Used to designate the insurance company.
Cash-Value Life Insurance-
combines death benefits with an accumulation feature. The buyer of a cash value policy pays more in the early years than for term insurance, but the money not needed to pay for the cost of the death benefit accumulates at interest. If the policy is surrendered before the insured dies, there may be a cash value paid to the owner Make sure the agent/broker provides you with the method by which the cash value is determined and that they obtain this information based on the policy's guaranteed value. As a general rule, it is not a good idea to buy cash value life insurance if you plan to surrender early. If all premiums are paid, cash value insurance usually lasts for the whole life of a person, and pays death benefits to the beneficiaries named in the policy upon the death of the insured. The cash value can be used as loan collateral for borrowing funds at the interest rate specified in the policy. Any outstanding loans are deducted from policy proceeds at death or surrender. Some of these products may enjoy tax advantages. A policy lapse or surrender may create a taxable event and may generate a Form 1099. Be sure to check with your tax advisor.
Covers your legal liability for property damage and bodily injury to others.
An incident or series of related incidents involving a substantial loss of property or causing substantial liability across a wide geographic area.
A document provided to a person insured under a group insurance policy evidencing that the coverage exists.
Certificate of Insurance-
A statement of coverage issued to an interested third party that outlines insurance coverages, limits, insurers, policy numbers and policy terms. A certificate of insurance often is used as proof of insurance in legal transactions such as property leasing and obtaining a mortgage.
A request for payment of a loss that may be covered under the terms of an insurance policy.
Any employee reporting an industrial injury of occupational disease irrespective of its merits. At some point if the claimant hires an attorney, a legal application can be filed with the Workers? Compensation Appeals Board, which will ultimately decide or approve the resolution of all issues.
Claims Expenses Outside Limits (CEOL)-
With this optional coverage, defense costs and other claims expenses have a separate limit and thus will not decrease the primary limits, keeping such amounts available to pay for ultimate judgments or settlements.
Covers only claims that you report during the policy period. A retroactive date is established as the earliest possible date for an event on which the claim is based. Events that happened before this date are excluded from claims-made coverage.
Class or Classification-
The systematic arranging of business operations into groups or categories according to certain criteria. The purpose of such classification is to create bases for establishing statistical experience and determining proper rates.
Rates filed by each insurance company with the Department of Insurance for the specific classification of operations. The workers? compensation rates apply per $100 of payroll of the insured.
(See Automobile Collision Coverage.)
The sum of an expense ratio and a loss ratio. An underwriting profit occurs when the combined ratio is under 100% and an underwriting loss occurs when the combined ratio is over 100%.
Commercial Auto Insurance-
Covers claims for which your business becomes legally liable arising out of your business? use of autos. It may include protection for damage to an auto that is titled to your business. Commercial auto insurance can cover company-owned cars, trucks, buses and other types of vehicles.
Commercial General Liability Insurance-
Covers claims brought by third parties against your business alleging bodily injury, property damage, personal injury or advertising injury, subject to policy terms and conditions.
Commercial Package Policy-
A Commercial Package Policy ("CPP") is a coverage plan that includes a wide range of essential liability and property coverages for a commercial enterprise which may otherwise be purchased separately. The package policy usually features common policy conditions, common declarations, and two or more coverage sections.
(See Automobile Comprehensive Coverage.)
Compromise & Release (C&R)-
A legal document filed and approved by the Workers? Compensation Appeals Board that, for a financial consideration, removes from the carrier/employer all or a portion of future liability on a loss.
Reimburses you for any physical loss or damage to your computer hardware, software, or data and includes coverage for the cost to reconstruct software or data. This coverage sometimes includes reimbursement for business interruption following a loss.
Withholding material facts from an insurance company when applying for an insurance contract or making a claim, with the intention of deceiving the insurance company. This action may be grounds for voiding the policy.
Loss arising indirectly or as a consequence of a direct physical damage loss, including time element losses such as business interruption.
A legal agreement between two or more parties.
Contractor's Equipment and Tools Coverage-
Insures your equipment and tools used at your job site, being transported between jobs and being transported from your primary location to the job site. It may also cover the cost of renting equipment and tools following a covered loss to your own equipment and tools.
Contractual Liability Coverage-
Provides coverage for certain liabilities you assume in a written contract, subject to the policy terms and conditions.
Counterfeit Money Order and Paper Currency Coverage-
Reimburses you for financial loss if a customer pays you with a counterfeit money order or counterfeit paper currency.
The scope of the protection provided under a workers? compensation contract of insurance.
The date stated in a policy as the date on which the contract was issued by the insurer. This is not necessarily the effective date of the policy.
The portion of the insurance policy that contains specific information, such as your name and address, a description of your property, the coverage, premium and policy term.
Rejection of an application for insurance by the insurer.
The specific dollar amount you must pay before your insurance policy begins to pay your covered loss.
The terms of a workers? compensation policy provide that the insurer require a deposit premium at the inception of the policy. The deposit premium is applied once the actual earned premium has been determined upon completion and billing of the final audit.
A decrease in the value of property over a period of time as a result of use, wear and tear, or obsolescence.
Design Services Liability Coverage-
Protection for contractors against damages that arise out of errors in design by the insured contractor in conjunction with projects the insured constructs. Most standard Business Owner?s Policies exclude this coverage.
Directors and Officers Liability Insurance-
Covers your company?s directors and officers from liability claims arising out of judgment errors, breaches of duty and wrongful acts related to their organizational activities. Shareholders, employees and potential business partners may file claims. Generally the coverage excludes intentional and dishonest acts, and allegations of bodily injury and property damage.
A physical or mental impairment that substantially limits one or more major life activities. The disability may be partial or total.
Payments that compensate a disabled employee for loss of income or earning capacity.
Unfair treatment or denial of rights to a person on the basis of the group, class, or category to which the person belongs.
(See Employee Retirement Income Securities Act of 1974.)
Each Claim Deductible-
A deductible that must be satisfied for each separate claim. Premium discounts may apply if this option is selected for certain policies.
That amount of the estimated premium determined to have been earned based on actual payrolls audited either by a physical audit or by the policyholder?s voluntary payroll report. This can be determined monthly, quarterly, semiannually or annually.
The inception or starting date and time of an insurance policy. The date on which the coverage of a workers? compensation insurance policy goes into effect at 12:01 a.m.
Electronic Data Processing (EDP) Coverage-
Covers damage to your computer equipment, data systems and information storage media. Also covers your expenses to reconstruct lost electronic data because of a covered loss.
Fraudulent use or theft of property or money not belonging to the person entrusted with its care.
Employee Benefits Liability Coverage-
Protects your business from losses arising from the administration of employee benefit programs, such as enrolling employees in a health plan.
Employee Dishonesty Coverage-
Reimburses you for financial loss to your business due to dishonest or fraudulent activities of one or more employees.
Employee Retirement Income Securities Act of 1974 (ERISA)-
Prescribes federal standards for funding, participation, vesting, termination, disclosure, fiduciary responsibility and tax treatment of private pension plans.
Employee Tool Coverage-
Covers your employees' tools while at any job site or in transit to or from a job site.
Employer's First Report of Occupational Injury or Disease-
A form specified by the state on which an employer must report to the insurer an occupational injury or illness. The report must be filed within five days of the insured's knowledge or communication from the employee.
Employers Liability Coverage-
Provides liability protection for employers for damages arising from employment-related accidents or diseases. This coverage may also provide certain benefits if your business is sued by a third party affected by a workplace injury, such as a family member of the injured worker. However, an injured worker or anyone else seeking to recover damages under this coverage must prove that the employer was legally responsible for the injury or disease. This coverage may be included in a workers' compensation policy. This is coverage B of the standard workers' compensation policy. It provides coverage against the common law liability of any employer for injuries to employees as distinguished from the liability imposed by a Workers' Compensation law. Employer's Liability applies in situations where a worker does not come under these laws.
Employment Practices Liability Insurance-
Employment Practices Liability Insurance ("EPLI") is coverage against claims by employees alleging that they suffered damages as a result of the employer's discrimination, wrongful termination, sexual harassment, or various other employment-related offenses.
A written amendment added to and made a part of an insurance policy to change the original insurance policy language. The change may restrict or broaden the coverage.
Equipment Breakdown Coverage-
Pays to repair or replace your equipment in case of breakdowns caused by events that typically are excluded from most business insurance policies, such as power surges, mechanical malfunctions and boiler explosions. Covers computers, scanning equipment, phone systems, air conditioners, refrigeration systems and many other types of equipment. It also is known as Systems Breakdown Coverage.
Errors and Omissions-
Protects you against liability for committing an error or omission in the performance of professional duties. E&O policies are designed to cover financial losses rather than liability for bodily injury or property damage. For example, E&O coverage would protect an architect who is sued because he made a mistake in his drawings for a new building or an accountant who failed to tell a client to submit quarterly estimated tax payments.
A provisional premium which is adjusted at the end of the year. In workers' compensation insurance, an estimated premium is based on estimated payrolls for the coming year. At the end of the year, final payrolls are determined and the final earned premium is computed.
Evidence of Insurability-
Medical and other information about a person applying for insurance that the life insurance company keeps confidential, but uses to decide whether the policy can be issued and what premiums to charge.
Provides coverage above the limits of a primary insurance policy, after those limits have been exhausted.
A written provision in an insurance policy that denies coverage for certain events, hazards, people, property or locations.
The percentage of the premium dollar devoted to paying the expenses of an insurer, other than losses.
The cost of conducting an insurance operation aside from the amount paid for losses.
A statistical compilation relating losses to premiums for a specific policy or policies.
The increase or decrease in premiums resulting from the application of an experience rating plan, usually expressed as a percentage and calculated by the Workers' Compensation Insurance Rating Bureau.
A method of adjusting the premium for a risk based on past loss experience for that risk compared to the manual rate for the insured?s classification.
The date specified in an insurance policy as its termination date.
The risk of loss due to some potential hazard. Also used to measure the rating units or the premium base of a risk.
Extra Expense Coverage-
Covers additional costs of continuing your business following a covered loss or damage to your insured property. This coverage could include the expense of renting an alternative office and buying new office supplies. This coverage is important if you can't close your business in the event of a loss, but must quickly find alternative office space to continue your business operations.
The amount to be paid to the beneficiary when the insured dies. It will be reduced by any unpaid policy loans and interest on those loans and may be increased by any dividends.
(See Employee Dishonesty Coverage.)
Final Audit Billing-
An actual billing based on either actual audited exposure or reported exposures (payroll report) for the entire policy period. The final audit billing takes into account all previously billed invoices.
Fine Arts Coverage-
Covers your works of art that are damaged due to perils, subject to the terms and conditions of the policy. The coverage is written on a valued basis.
Fire Damage Liability Coverage-
Pays for fire damage caused by your business to the property of others in your building. It also covers fire damage to other parts of the building you occupy, due to negligence by you or an employee.
First Dollar Defense-
Provides coverage for defense expenses related to a malpractice claim from the first dollar. Allows the deductible to be applied to the loss only.
The policy which is cancelled upon its effective date, affording no coverage.Under a flat cancellation no premium charge is made.
Covers your property in the event of a flood.
Food Storage Coverage-
Reimburses you for the cost of your food inventory damaged due to spoilage caused by an insured incident.
A required period, of 10 or more days after a policy has been delivered to the policy owner; during which the policy can be returned for a refund of all amounts paid.
Covers the legal liability of automobile dealers, garages, repair shops and service stations for bodily injury and property damage claims arising out of business operations. Damage to customers' vehicles is excluded from this coverage. (see Garagekeepers' Legal Liability.)
Garagekeepers' Legal Liability Coverage-
Provides coverage to owners of vehicle garages, parking lots and vehicle repair shops for damage to your customers' vehicles left in your custody for safekeeping or repair. Coverage is applicable only if you are at least partially responsible for the loss.
In lieu of a complete Business Owner's Policy, this coverage protects your business for covered third party liability damage. This policy provides no Property coverage.
General Liability Insurance-
Basic coverage that protects business owners and operators from lawsuits brought by third parties alleging bodily injury or property damage.
Pays to replace or repair glass on your property that is damaged by a variety of factors, including vandalism. You may need this coverage even if you don't own your building, when your lease specifies that you are responsible for building glass.
The classification assigned to the operations of an insured that carries the largest amount of payroll other than standard exception classifications.
A period (usually 31 days) after the premium due date, during which an overdue premium may be paid without penalty. The policy remains in force throughout the period.
Growth Guard Coverage-
Property Growth Guard Coverage provides a means by which property limits may be automatically increased over the course of the policy period. If, for example, the initial property limit is $1,000,000 and the insured selects a growth guard of 50%, the property limit will increase to $1,500,000 ($1,000,000 + 50%) by the end of the policy period. The rate at which the limit will increase is $1,369.85 (1/365 X $500,000) per day.
An option that permits the policy holder to buy additional stated amounts of life insurance at certain times in the future without having to provide new evidence of insurability.
A condition that creates or increases the chances of a loss arising from an insured peril. Examples include slippery floors and unguarded property.
Hired and Non-Owned Auto Liability Coverage-
Protects your business from liability due to your employees' job-related use of vehicles your company does not own. This coverage includes hired or rented vehicles and employees' own vehicles.
Hold Harmless Agreement-
A hold harmless agreement is normally included in a written contract whereby one party agrees to assume the other party's liability arising from specified actions. For example, if you contract with another party to do work for you, you agree, in writing, that the other party will pay for any liability you incur because of his work.
A document used in life insurance sales presentations showing year-by-year numbers indicating how a policy will work. Usually it assumes that amounts being paid today will continue in all future years.
Incurred But Not Reported (IBNR)-
Losses that have occurred during a stated period of time but have not yet been reported to the insurer as of the date under consideration.
Incurred Loss Ratio-
The percentage of losses incurred to premiums earned.
The losses occurring within a fixed period, whether or not reported, adjusted or paid during the same period.
The first page of the policy identifying the entity insured, mailing address, broker, policy period, policy limits, list of the endorsements, classification rating information, minimum premium, deposit premium and annual premium.
Inland Marine Insurance-
Covers your goods in transit, except across oceans. The coverage also applies to items that are used at locations other than at your insured property.
Covers your building materials that will become a permanent part of a structure and the cost of labor involved in completing your project. Also applies to your materials while at the job site, while stored in temporary locations or while in transit between your primary business location and the job sites.
A premium charge for which premium payments may be made by the policyholder in installments during the policy period.
A government entity in each state or territory administers insurance laws and licenses and regulates insurance agents and companies. A state insurance department can be a stand-alone government agency or a division of another department.
The printed form which states the terms and conditions of coverage between an insurer and an insured.
The person or organization named, defined and protected by an insurance policy.
A definition in a liability policy that describes the types of contracts in which liability is assumed by the insured and included for coverage in the policy.
The party to an insurance contract who undertakes to indemnify for losses, provide benefits or render services. The work insurer is generally used in statutory law.
The integration of workers' compensation insurance with group health insurance.
Interim Audit Billing-
An actual billing based on either actual audited exposure or reported exposures.
A separate policy form that covers damage to the Insured's stock of jewelry, precious and semiprecious stones, watches, precious metals, and similar merchandise; along with similar 'property of others' in the Insured's care, custody, or control.
Discontinuation of insurance without cash values when required premiums are not paid. If cash value exists there be nonforfeiture provisions available.
A policy which has been allowed to expire because of nonpayment of premiums or because the insurance contract becomes void for other reasons.
Your company's legal responsibility to make financial restitution for bodily injury or property damage to a third party because of your company's action or inaction. May also refer to a company's debts and future obligations. (Also see Liability Insurance.)
Provides financial protection in case your business is sued or held legally responsible for bodily injury or property damage to a third party. Typically, covered expenses include: The amount the insurer spends to investigate or defend the claim or lawsuit Other costs incurred directly by the insurance company, such as attorneys' fees, witness fees and police report costs. Court costs or other costs assessed against you Reasonable expenses you incur at the insurance company's request to aid in your defense against a claim, such as your loss of income for a day spent in court A judgment or settlement arising from a covered lawsuit Any required interest on the judgment if the defense is unsuccessful Medical expenses for injured parties. *The policy may include coverage for premises, personal injury, products and completed operations and contractual liabilities.
Written defamation conveying an unfavorable impression about an individual and harming that person's reputation.
Limits of Liability-
The maximum amount of money an insurer agrees to pay for any one occurrence under a particular insurance policy.
Liquor Liability Coverage-
Provides your business with protection from bodily injury and property damage claims arising from selling or serving alcoholic beverages.
An automobile that is used to transport people for a fee, such as a limousine or a taxi.
The amount which can be borrowed by the policy owner from the company using the value of the policy as collateral. Usually the interest rate payable on the loan varies based on an index defined in the policy
The amount sought by a policyholder in connection with a claim or the amount paid by an insurance company for a claim.
Loss Control Consultant-
Provides professional and technical counseling to policyholders and insurance company management staff on proper risk evaluations, including possible controls to eliminate/reduce potential losses.
The increase in the amount of losses and/or reserves reported on a specific date and the amount reported on a later date.
The rate of the occurrence of accidents expressed in terms of the number of accidents over a given period of time.
The losses incurred expressed as a percentage of earned premium.
The estimated liability for unpaid insurance claims or losses that have occurred as of a given evaluation date. On an individual claim, the loss reserve is the estimate of what will ultimately be paid out on that claim.
A report listing specific claims with their individual reserves.
Protects your business from financial loss due to theft, vandalism or other damage to materials being stored or used at a job site.
Medical Payments Coverage-
Covers reasonable medical and funeral expenses as a result of bodily injury to or the death of an individual other than the insured due to an accident. This coverage can be part of an automobile policy or a general liability policy.
The smallest amount of premium for which an insurer will issue coverage under a given policy.
Making written or verbal statements that are untrue or misleading, with the intention of deceiving the insurance company. This activity may be grounds for voiding the insurance policy that was issued based on the original statements.
Mode of Premium Payment-
The frequency of premium payments during the policy year. Premium payments can usually be made on annual, semiannual, quarterly or monthly modes.
Money and Securities Coverage-
Subject to policy provisions, protects your money and securities against theft, disappearance or destruction while they're on your business premises or off-site, such as while being transported to the bank.
States in which state-operated funds are the only entities allowed to underwrite workers? compensation insurance. The five monopolistic states are: North Dakota, Ohio, Washington, West Virginia and Wyoming. In these states, employers must buy workers' comp coverage from the state fund. However, these funds do not offer employers liability coverage, which must be bought from an insurance company.
A statistical table showing the death rate ("probability of death) at each age.
A term often found in the classification section of workers' compensation rating manuals. If a classification is followed by N.O.C., it means to use this classification if an insured cannot be classified more specifically.
No Payroll Division
Any people or entities specifically named in the policy declarations as covered by an insurance policy. There may be others who also are covered by the policy but are not named.
Named Perils Policy-
A property insurance policy that covers only losses caused by the perils specifically listed in the policy. This coverage contrasts to special form coverage, which covers property losses from all causes not specifically excluded.
Failure to use the degree of care considered reasonable under the circumstances.
A law enacted by many states allowing a victim of an automobile accident to collect medical and hospital expenses from his or her own insurance company.
Provision in the policy which allow policy owner to chooses how the cash value of the policy will be used if the policy is surrendered or lapses due to non-payment of premium.
Non-Owned and Hired Automobile Liability Coverage-
Provides your business protection against liability claims arising from the use of autos hired, rented or owned by others (including your employees) for company business. The coverage does not apply to vehicles titled to your business.
Notice of Cancellation-
Written notice by an insurer of its intent to cancel insurance.
A disease arising out of and medically linked to the exposure to harmful conditions of employment.
A condition in an occupation that increases the peril of accident, sickness or death.
An accidental event that results in loss or damage.
Occurrence Coverage Form-
Covers claims that happened during the policy period, regardless of when you file or report the claims.
Ocean Marine Coverage-
Covers your cargo being transported by water.
Off-Premises Power Failure Coverage-
Reimburses you for your loss of business income if an off-premises power failure temporarily shuts down your business operations because of a covered loss.
Off-Premises and In-Transit Coverage-
Extends protection of your business personal property away from your principal business site.
Other Business Structures Coverage-
Extends protection to other business structures on your property, such as a greenhouse, business car garage or storage shed.
All rights, benefits, and privileges under a policy are controlled by the owner, who is usually the insured. Ownership may be transferred or assigned to someone else by written request of the current owner.
A single insurance policy that includes property and liability coverages, and possibly others.
The amount actually paid for losses during a specified period of time.
Insurance on which it is guaranteed that no further premium need be paid.
Insurance on which the policy owner is entitled to share in the surplus earnings of the company through dividends which reflect the difference between the premium charged and the actual earnings and costs of providing coverage.
Peak Season Coverage-
Automatically provides you with a specified percentage increase in insurance coverage during peak inventory periods when you insure your inventory for its average monthly value.
The cause of a possible property loss, such as fire, windstorm, theft, explosion or riot.
Permanent Disability (P.D.)-
The benefit paid for impairment resulting from an industrial injury or occupational disease of any bodily or mental function which remains after maximum recovery and, which causes diminishment of earning capacity, diminishment of normal use of a member or competitive handicap in the open labor market.
Permanent Partial Disability-
A condition where the injured party's earning capability is impaired for life, but he or she is able to work at reduced efficiency.
Permanent Total Disability-
A condition where the injured party is not able to work at any gainful employment for the remaining lifetime.
Personal Injury Coverage-
Protects your business from liability due to injury (other than bodily injury) to a third party that arises out of false arrest, detention or false imprisonment, malicious prosecution, wrongful eviction, wrongful entry, invasion of privacy or slander, except in the course of advertising, publishing, broadcasting or telecasting. (See Advertising Liability.)
Personal Injury Protection-
The bodily injury and other automobile insurance coverages required under state no-fault insurance laws. These benefits may include basic medical expenses, rehabilitation, lost earnings, funeral expenses and survivors? benefits. (See No-Fault Insurance.)
Personal Property Coverage-
(See Business Personal Property Coverage.)
The printed legal document stating the terms and conditions of the insurance contract that an insurance company issues to the policyholder (you).
The anniversary of the effective date of coverage of a policy.
The period during which the policy contract affords protection.
The length of a policy period.
A one-year period starting on the day and month the policy was issued. The first policy year starts on the date of issue, and ends on the day before the policy's first anniversary.
Policy Year Experience-
The measure of premiums and losses for each 12-month period a policy is in force. Losses occurring during the 12-month period are assigned to the period regardless of when they are reported or paid.
The entity that owns an insurance policy; the insured.
Pollution Liability Coverage-
A specialized insurance policy that covers liability associated with your business' contamination of the air, ground or water. It may also provide coverage for clean-up costs.
The property described and designated in an insurance policy's declarations.
Premises Liability Coverage-
Protects your business against liability damages due to an injury that occurs on your premises to a third party. An example would be a customer slipping or falling at your business.
The dollar amount an insurance company charges to provide the coverage in an insurance policy or bond.
Pro Rata Cancellation-
The termination of a workers' compensation insurance contract with the premium charge adjusted in proportion to the exact time the coverage has been in force.
See Agent and Broker.
Products Liability and Completed Operations Coverage-
Covers third-party bodily injury or property damage occurring somewhere other than your premises from a product your company made, distributed or sold, or a service your business provided. In the event of a lawsuit, your business also is covered for related defense costs.
Professional Liability (PL) Insurance-
Protects you against liability for committing an error or omission in the performance of professional duties. Professional Liability policies are designed to cover financial losses rather than liability for bodily injury or property damage. For example, Professional Liability coverage would protect an architect who is sued because he made a mistake in his drawings for a new building or an accountant who failed to tell a client to submit quarterly estimated tax payments.
Professional Liability Coverage-
Protects professionals such as physicians, dentists, attorneys and accountants from liability due to errors and omissions in the performance of professional duties. (See Errors and Omissions Liability.)
Property Damage Liability Coverage-
Protects your business against liability damages arising from physical loss or damage to someone else's property, other than your employees'. It usually includes damages for their loss of use of the property.
Provides financial protection against physical loss or damage caused by fire, windstorm, vandalism or other covered incidents to many kinds of business property that you own. Covered business property can include your building, equipment, tools, supplies, furniture, fixtures and improvements.
Property of Others Coverage-
Covers you for damage to the property of others that is in your possession and for which you are legally liable while it is in your possession.
Pure Premium Rates-
The loss cost per unit of exposure as developed by the Workers' Compensation Rating Bureau, including loss adjustment expense for the standard classifications.
A charge per unit used in calculating insurance premiums.
A policy issued with an additional premium to cover the extra risk involved if an insured has impaired health, a hazardous occupation or hobbies, or is a private pilot.
An organization under the jurisdiction of the Department of Insurance that classifies, analyzes manual rate, compiles statistical data and measures the hazards of individual risks.
Real estate property that includes buildings but excludes land.
Payment of an amount of money by an insurance policy in the event of a covered loss.
The restoring of a lapsed or surrendered policy to full force and effect. The company requires evidence of insurability, and payment of all amounts necessary, including interest, to put the policy into the condition it would have been in had the lapse or surrender not occurred. The company is not obligated to reinstate a policy.
Rental Reimbursement for Tools and Equipment Coverage-
Reimburses you for the cost of renting tools or equipment if yours are not available due to a covered loss.
Replacement Cost Value-
The dollar amount it costs to replace or repair your damaged property with that of like kind and quality, without any deduction for depreciation.
Research and Development Property-
Research and Development Property is property directly related to the development of new products or enhancement of existing products, such as records, formulas, test samples or a prototype.
A provision found in many claims-made policies that limits coverage for injuries or damage to those occurring after this specified date.
An attachment to an insurance policy or a bond that expands or restricts coverage, or makes some other policy change. Sometimes used as a synonym for endorsement, and frequently is used in connection with bonds.
A chance of loss. Also used to mean the insured, or the property the insurance applies to.
Theft of personal property, either by force or with a threat of force.
Members of a specific industry joining together for the purpose of purchasing insurance.
Seasonal Inventory Increase Coverage-
(See Peak Season Coverage.)
The manner in which the insured or beneficiary may choose to have the policy proceeds paid.
Sewer and Drain Back-Up Protection-
Protects your business against losses caused by water backing up through your sewers or drains, or by water overflowing from a pump.
Unwelcome sexual advances, requests for sexual favors, or other verbal or physical conduct of a sexual nature that are made a condition of employment, used as a basis for employment decisions or create a work environment that interferes with job performance. Most standard Business Owner's Policies exclude coverage for sexual harassment claims. (See Employment Practices Liability Insurance.)
Short Rate Cancellation-
A cancellation procedure in which the earned premium is not in direct proportion to the number of days of coverage.
Short Rate Penalty-
The penalty paid by the insured for replacing coverage prior to the expiration date.
A policy written for a period of time less than one year.
Insures your outdoor signs against theft, fire, vandalism and other losses.
Spoken defamation conveying an unfavorable impression about an individual and harming that person's reputation.
In workers' compensation insurance, certain employees are classified separately rather than being included in the main classification for a risk. There are two standard exceptions, clerical office employees and outside sales persons.
The classification of an applicant for a life insurance policy who fulfills the physical, occupational, and other requirements on which most of a company's policies are issued. Someone whose characteristics are more favorable may be classified as a "Preferred Risk". When the characteristics are less favorable, the applicant may be characterized as "Rated", or revised coverage altogether.
A state-owned and operated entity that writes workers' compensation insurance. (See Monopolistic States.)
Any provision in a policy designed to cut off an insurer's losses at a given point.
The assignment to an insurer, after payment of a loss, of an insured's right to recover the amount of the loss from someone who is legally liable for the damages.
A policy provision which reduces or eliminates the amount to be paid if the insured dies of suicide within the first two policy years.
A company, usually an insurance company, which issues a surety bond. The surety company agrees to fulfill the obligation of the bonded party, according to the terms of the surety bond.
A guarantee by a surety company that the bond buyer will fulfill a certain obligation he or she has made to a third party. Unlike other forms of insurance, the entity protected by the bond is a third party, not the buyer; the surety bond buyer is the one doing the work that is guaranteed.
What is left over after a company's liabilities are deducted from its assets.
To voluntarily terminate or cancel a policy for its cash value or other nonforfeiture options.
Protects perishable stock you have on your premises in case of damage caused by a temperature change due to an equipment breakdown or power failure.
Temporary Disability (T.D.)-
The benefit paid to a claimant for the time that he or she is medically unable to work due to an industrial injury or occupational disease and before he or she has reached a point of maximum improvement or permanent and stationary status from the effects of the accident. The benefit amount is derived from average weekly earnings within minimum and maximum ranges.
Term Life Insurance-
provide life insurance for a specified period of time. These policies provide benefits in the event of death, but they generate no "cash value". If you have a limited amount to spend, and only need insurance for a finite period of time, you may be able to get more coverage by buying term insurance than by buying cash value insurance. Keep in mind that the cost of term insurance increases as you get older, which may make it more expensive than cash value insurance in the long run. Today's term policies usually have two sets of premiums - guaranteed maximum premiums, and "current premiums", which are usually much lower, but which can be changed by the company. The company cannot increase current premium above the guaranteed maximum premiums shown in the policy. When you buy term insurance you need to make a choice as to how long you want the protection. You may renew the policy without a physical examination for the period of years specified in the policy. Some term insurance can be converted to cash value insurance up to a specified age with no physical examination. Premiums for the converted insurance will most likely be higher than the premiums you would be paying for the term insurance.
The time the coverage under an insurance policy ends, either because it s term has expired or because it has been cancelled by either party.
Any act of stealing, including burglary, robbery and larceny.
Title Agency Coverage Endorsement-
Coverage available for a separate title agency that is 51% or more owned by an insured law firm.
A wrongful act against another person, other than breach of contract, that results in injury or damage on which a civil lawsuit may be based.
The sum of loss, loss adjustment expense, other expense and dividend ratios.
Protects shipments of goods you make by car, truck, rail, or air from the time they leave your business location to the time they are delivered to your customer.
Provides additional protection for your business over and above the liability limits of primary insurance policies such as Business Owner's Policies, commercial automobile policies and workers' compensation. Subject to the policy terms and conditions, coverage begins after the policy limits of a primary policy have been exhausted.
The insurance company that insures a particular risk, or the person at an insurance company who evaluates applications for insurance coverage, decides whether to accept or reject the risk and sets a price for the coverage.
The process of evaluating applications for insurance coverage, deciding whether to accept or reject the risk and setting a price for the coverage. This may involve a physical examination of the applicant.
Unit statistical filings are experience reports that include payroll and loss information on every workers' compensation policy.
Universal Life Insurance-
differs from whole life insurance in that it allows the policy owner to vary, with limitations, the amount and timing of premium payments and the death benefit. Cash values are accumulated by crediting premium payments and interest to a fluid from which deductions are made for expenses and cost of insurance. The rates at which the interest is credited are declared by the company or may be specified in the contract. Like term insurance, universal life insurance policies usually have two sets of premiums - guaranteed maximum premiums, and "current premiums", which may be lower, but which can be changed by the company, up to the maximum. They also include a minimum interest guarantee. Because of its flexibility, a universal life policy can also be structured to operate like term insurance.
Pays for the cost to research, reproduce, replace or restore your valuable business records if they are not duplicated but are damaged or destroyed by a covered loss. Coverage includes printed or written documents, books, films and more.
The malicious or ignorant, often random, destruction or spoilage of another person's property.
Variable Life Insurance-
differs from whole life insurance and universal life insurance in that policy owners direct the distribution of their premium payments among several different accounts or funds rather than of the company's choosing. Typical account choices are: common stock, bond, mortgage, and money-market accounts. With this type of policy, the death benefit and cash value benefits vary in relation to the value of the investments underlying the policy. If the value of the accounts increases, so will the benefits; if the value of the account decreases, so will the benefits, subject to a minimum guarantee. Variable life insurance is more risky to the policy owner than the other forms of cash value insurance, but there is a possibility of greater returns.
Variable Universal Life Insurance-
Insurance combines the flexibility of universal life insurance with the investment account features of variable life insurance.
The liability of one person for the acts of another. Vicarious liability can result from the acts of independent agents, partners, independent contractors and employees.
The process, services and benefits necessary to return an injured worker to suitable gainful employment when the worker is medically unable to return to the job due to an industrial injury or occupational disease.
Voluntary Payroll Report-
A request sent to the policyholder with a set of instructions for providing payroll information necessary to adjust the premium earned on outstanding and expired policies.
A rider added to policy that will pay the premiums during the total disability of the insured.
A warranty product protects customers from financial loss associated with the breakdown or underperformance of a product or service.
Water Damage Coverage-
Protects your business from losses resulting from flooding and surface water, and the backup of sewers, drains or sump pumps.
Whole Life Insurance-
(also known as straight life, ordinary life and traditional permanent insurance) has guaranteed premiums and death benefits, and a minimum interest rate which will be credited to the funds accumulated in the policy. On some whole life policies higher interest rates may be credited to those funds depending on the future performance of the company's investments.
Workers' Compensation Insurance-
Provides benefits, as specified by state law, to employees for work-related injuries or illnesses, regardless of who is at fault. Typical covered expenses include medical benefits, such as medical, hospital and surgical costs; related healthcare costs such as physical therapy and prosthetic devices; disability income benefits, including services such as vocational rehabilitation that help an injured worker return to productive work; and death benefits. (Also see Employer's Liability Coverage.) Workers' compensation is a no-fault system, meaning that injured employees do not have to sue their employers to receive compensation. Compensation is automatic for covered benefits.