The insurer uses actuarial science to quantify the risk they are willing to assume. Data is generated to approximate future claims, ordinarily with reasonable accuracy. Actuarial science uses statistics and probability to analyze the risks associated with the range of perils covered, and these scientific principles are used by insurers, in conjunction with additional factors, to determine rate structures. For example, many individuals purchase homeowner's insurance policies by signing a contract paying a premium to an insurance compan ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

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Any risk that can be quantified probably has a type of insurance to protect it. Among the different types of insurance are: Automobile insurance, also known as auto insurance, car insurance and in the UK as motor insurance, is probably the most common form of insurance and may cover both legal liability claims against the driver and loss of or damage to the vehicle itself. Over most of the United States purchasing an auto insurance policy is required to legally operate a motor vehicle on public roads. Recomm ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

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Definition and meaning of Step-Rate Premium :

Step-Rate Premium: A rating structure in which the premiums increase periodically at pre-determined times such as policy years or attained ages.

(Source: The Haskayne School of Business at the University of Calgary )

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Definition and meaning of Age Change :

Age Change: The date on which a person's age, for insurance purposes, changes. In most Life Insurance contracts this is the date midway between the insured's natural birth dates. Health insurers frequently use the age of the previous birth date for rate determinations. On the date of age change, a person's age may change to that of the last birth date, the nearer birth date, or the next birth date, depending upon the way in which the rating structure has been established by that particular insurer. (LI,H)

(Source: InsWeb)

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Definition and meaning of Age Change :

Age Change:  The date on which a person's age, for insurance purposes, changes. In most Life Insurance contracts this is the date midway between the insured's natural birth dates. Health insurers frequently use the age of the previous birth date for rate determinations. On the date of age change, a person's age may change to that of the last birth date, the nearer birth date, or the next birth date, depending upon the way in which the rating structure has been established by that particular insurer. (LI,H)

(Source: InsWeb)

Also see these pages: Age Change , Health Insurance, Health Insurance Sitemap,  Insurance, Insurance Sitemap, Insurance Dictionary - A

An entity seeking to transfer risk (an individual, corporation, or association of any type) becomes the 'insured' party once risk is assumed by an 'insurer', the insuring party, by means of a contract, defined as an insurance 'policy'. This legal contract sets out terms and conditions specifying the amount of coverage (compensation) to be rendered to the insured, by the insurer upon assumption of risk, in the event of a loss, and all the specific perils covered against ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

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In the casino game , insurance is an optional play that requires the player to bet 1/2 of his current bet to the posibilitiy of the house drawing a blackjack (an ace and a ten), if the house does draw a blackjack, all insured players get their bet back, including the insurance, if not, the insurance is lost and the game continues as normal. a player can only buy insurance if the house open card is an ace or a ten-value card (a 1 ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

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Certain life insurance contracts accumulate cash values, which may be taken by the insured if the policy is surrendered or which may be borrowed against. Some policies, such as annuities and endowment policies, are financial instruments to accumulate or liquidate wealth when it is needed. See life insurance. In many countries, such as the US and the UK, tax law provides that the interest on this cash value is not taxable under certain circumstances. This leads to widespread use of life insurance as a tax-efficient method of sa ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

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Early methods of transferring or distributing risk were practiced by Babylonian traders as long ago as the 2nd millennium BCE. The Babylonians developed a system which was recorded in the famous Code of Hammurabi, c. 1750 BC, and practiced by early Mediterranean sailing merchants. If a merchant received a loan to fund his shipment, he would pay the lender an additional sum in exchange for the lender's guarantee ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

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The timing or occurrence of the loss must be uncertain. The rate of losses must be relatively predictable: In order to set premiums (prices) insurers must be able to estimate them accurately. If the coverage is unique, the insured will pay a correspondingly higher premium. Lloyd's of London often accepts unique coverages. (e.g., the insuring of Tina Turner's legs) The losses must be predictable on a macro level: Insurers need to know how much they would be required to pay when the insured-for event occurs. Most types of insurance have maximum levels ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

Read more here: » Insurance: Encyclopedia II - Insurance - Principles of insurance

The timing or occurrence of the loss must be uncertain. The rate of losses must be relatively predictable: In order to set premiums (prices) insurers must be able to estimate them accurately. If the coverage is unique, the insured will pay a correspondingly higher premium. Lloyd's of London often accepts unique coverages. (e.g., the insuring of Tina Turner's legs and Jennifer Lopez's behind) The losses must be predictable on a macro level: Insurers need to know how much they would be required to pay when the insured-for event occurs. Most types of insurance have maximum levels ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

Read more here: » Insurance: Encyclopedia II - Insurance - Principles of insurance

Insurance companies may be classified as Life insurance companies, who sell life insurance, annuities and pensions products. Non-life or general insurance companies, who sell other types of insurance. In most countries, life and non-life insurers are subject to different regulations, tax and accounting rules. The main reason for the distinction between the two types of company is that life business is very long term in nature — coverage for life assurance or a pension can cover risks over many decades. By contrast, non-life insuranc ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

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Some people erroneously consider insurance a type of wager (particularly as associated with moral hazard) that executes over the policy period. The insurance company bets that you or your property will not suffer a loss while you put money on the opposite outcome. The difference in the fees paid to the insurance company versus the amount for which they can be held liable if an accident happens is roughly analogous to the odds one might expect when betting on a racehorse (for example, 10 to 1). For this reason, a number of religious groups, i ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

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A customer might pay one or more premium payments over time. The company collects these payments from one or more customers. If something happens which triggers a claim, the company then pays out a certain amount of money. If, during the lifetime of all of the company's insurance contracts, it pays out less than it has taken in, it makes what is known as an underwriting profit. One measure of an insurance company's performance is their loss ratio (incurred losses and loss-adjustment expenses divided by net earned premium). The loss ratio is ...

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Insurance, Insurance - Principles of insurance, Insurance - Indemnification, Insurance - How an insurance company makes money, Insurance - Determination of rate structures, Insurance - Gambling analogy, Insurance - History of insurance, Insurance - Types of insurance, Insurance - Types of insurance companies, Insurance - Life insurance and saving, Insurance - Financial viability of insurance companies, Insurance - Controversies, Insurance - Insurance insulates too much, Insurance - Complexity of insurance policy contracts, Insurance - Redlining, Insurance - Health insurance, Insurance - Dental insurance, Insurance - Insurance Patents, Insurance - The insurance industry and rent seeking, Insurance - Insurance in Blackjack, Insurance - Glossary, Insurance - Quote, Insurance - Lists

Read more here: » Insurance: Encyclopedia II - Insurance - How an insurance company makes money