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A form of variable annuity contract usually with short surrender periods and higher mortality and expense risk charges.
A technique that consists of staggering the maturity dates and the mix of different types of bonds.
The theory of probability on which the business of insurance is based. Simply put, this mathematical premise says that the larger the group of units insured, such as sport-utility vehicles, the more accurate the predictions of loss will be.
Insurance for what the policyholder is legally obligated to pay because of bodily injury or property damage caused to another person.
See Ordinary life insurance; Term insurance; Variable life insurance; Whole life insurance
Maximum amount of insurance that can be paid for a covered loss.
Type or kind of insurance, such as personal lines.
Enables the state insurance department as liquidator or its appointed deputy to wind up the insurance company’s affairs by selling its assets and settling claims upon those assets. After receiving the liquidation order, the liquidator notifies insurance departments in other states and state guaranty funds of the liquidation proceedings. Such insurance company liquidations are not subject to the Federal Bankruptcy Code but to each state’s liquidation statutes.
The ability and speed with which a security can be converted into cash.
Coverage for bodily injury or property damage caused by an intoxicated person who was served liquor by the policyholder.
A global insurance and reinsurance marketplace made up of independent underwriters and capital providers that collectively insure complex and specialty risks. Lloyd’s is not a single insurance company; instead, it provides a platform connecting capital with risk through syndicates overseen by managing agents. Policies written at Lloyd’s are backed by a shared capital framework known as the “Chain of Security,” and the marketplace operates in more than 200 territories worldwide. In the United States, Lloyd’s is a major source of excess and surplus capacity and plays a significant role in covering large, unusual, or hard-to-place risks.
Long-term care (LTC) insurance pays for services to help individuals who are unable to perform certain activities of daily living without assistance, or require supervision due to a cognitive impairment such as Alzheimer’s disease. LTC is available as individual insurance or through an employer-sponsored or association plan.
A reduction in the quality or value of a property, or a legal liability.
The sum insurers pay for investigating and settling insurance claims, including the cost of defending a lawsuit in court.
The portion of an insurance rate used to cover claims and the costs of adjusting claims. Insurance companies typically determine their rates by estimating their future loss costs and adding a provision for expenses, profit, and contingencies.
A provision in homeowners and renters insurance policies that reimburses policyholders for any extra living expenses due to having to live elsewhere while their home is being restored following a disaster.
Percentage of each premium dollar an insurer spends on claims.
The company’s best estimate of what it will pay for claims, which is periodically readjusted. They represent a liability on the insurer’s balance sheet.