Definition and meaning of DIRECT PREMIUMS :

DIRECT PREMIUMS: Property/casualty premiums collected by the insurer from policyholders, before reinsurance premiums are deducted. Insurers share some direct premiums and the risk involved with their reinsurers.

(Source: Insurance Information Institute )

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Definition and meaning of DIRECT SALES/ DIRECT RESPONSE :

DIRECT SALES/ DIRECT RESPONSE: Method of selling insurance directly to the insured through an insurance companyÕs own employees, through the mail, by telephone or via the Internet. This is in lieu of using captive or exclusive agents.

(Source: Insurance Information Institute )

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Definition and meaning of DEREGULATION :

DEREGULATION: In insurance, reducing regulatory control over insurance rates and forms. Commercial insurance for businesses of a certain size has been deregulated in many states.

(Source: Insurance Information Institute )

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Definition and meaning of DEPOSITORY INSTITUTION :

DEPOSITORY INSTITUTION: Financial institutions that obtain their funds mainly through deposits from the public. They include commercial banks, savings and loan associations, savings banks and credit unions.

(Source: Insurance Information Institute )

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Definition and meaning of DEFINED BENEFIT PLAN :

DEFINED BENEFIT PLAN: A retirement plan under which pension benefits are fixed in advance by a formula based generally on years of service to the company multiplied by a specific percentage of wages, usually average earnings over that period or highest average earnings over the final years with the company.

(Source: Insurance Information Institute )

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Definition and meaning of DEFERRED ANNUITY :

DEFERRED ANNUITY: An annuity contract, also referred to as an investment annuity, that is purchased either with a single tax-deferred premium or with periodic tax-deferred premiums over time. Payments begin at a predetermined point in time, such as retirement. Money contributed to such an annuity is intended primarily to grow tax-deferred for future use.

(Source: Insurance Information Institute )

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Definition and meaning of DEFINED CONTRIBUTION PLAN :

DEFINED CONTRIBUTION PLAN: An employee benefit plan under which the employer sets up benefit accounts and contributions are made to it by the employer and by the employee. The employer usually matches the employeeÕs contribution up to a stated limit.

(Source: Insurance Information Institute )

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Definition and meaning of DEMAND DEPOSIT :

DEMAND DEPOSIT: Customer assets that are held in a checking account. Funds can be readily withdrawn by check, Òon demand.Ó

(Source: Insurance Information Institute )

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Definition and meaning of EXCLUSION :

EXCLUSION: A provision in an insurance policy that eliminates coverage for certain risks, people, property classes, or locations.

(Source: Insurance Information Institute )

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Definition and meaning of DIRECT WRITERS :

DIRECT WRITERS: Insurance companies that sell directly to the public using exclusive agents or their own employees, through the mail, by telephone or via the Internet. Large insurers, whether predominately direct writers or agency companies, are increasingly using many different channels to sell insurance. In reinsurance, denotes reinsurers that deal directly with the insurance companies they reinsure without using a broker.

(Source: Insurance Information Institute )

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Definition and meaning of EXTENDED TERM INSURANCE OPTION :

EXTENDED TERM INSURANCE OPTION*: One of several nonforfeiture options included in life insurance policies that allows the owner of a policy with a cash value to discontinue premium payments and to use the policyÕs net cash value to purchase term insurance for the full coverage amount provided under the original policy for as long a term as the net cash value can provide. (See Nonforfeiture options)

(Source: Insurance Information Institute )

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Definition and meaning of FRONTING :

FRONTING: A procedure in which a primary insurer acts as the insurer of record by issuing a policy, but then passes the entire risk to a reinsurer in exchange for a commission. Often, the fronting insurer is licensed to do business in a state or country where the risk is located, but the reinsurer is not. The reinsurer in this scenario is often a captive or an independent insurance company that cannot sell insurance directly in a particular country.

(Source: Insurance Information Institute )

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Definition and meaning of FREQUENCY :

FREQUENCY: Number of times a loss occurs. One of the criteria used in calculating premium rates.

(Source: Insurance Information Institute )

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Definition and meaning of FUTURES :

FUTURES: Agreement to buy a security for a set price at a certain date. Futures contracts usually involve commodities, indexes or financial futures.

(Source: Insurance Information Institute )

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Definition and meaning of GAP INSURANCE :

GAP INSURANCE: An automobile insurance option, available in some states, that covers the difference between a carÕs actual cash value when it is stolen or wrecked and the amount the consumer owes the leasing or finance company. Mainly used for leased cars. (See Actual cash value)

(Source: Insurance Information Institute )

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Definition and meaning of GENERAL ACCOUNT :

GENERAL ACCOUNT*: An undivided investment account in which insurers maintain funds that support contractual obligations for guaranteed insurance products such as whole life insurance or fixed-rate annuities. Contrast with separate account.

(Source: Insurance Information Institute )

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Definition and meaning of FREE-LOOK PERIOD :

FREE-LOOK PERIOD: A period of up to one month during which the purchaser of an annuity can cancel the contract with no penalty. Rules vary by state.

(Source: Insurance Information Institute )

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Definition and meaning of FRAUD :

FRAUD: Intentional lying or concealment by policyholders to obtain payment of an insurance claim that would otherwise not be paid, or lying or misrepresentation by the insurance company managers, employees, agents and brokers for financial gain.

(Source: Insurance Information Institute )

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Definition and meaning of FORCED PLACE INSURANCE :

FORCED PLACE INSURANCE: Insurance purchased by a bank or creditor on an uninsured debtorÕs behalf so if the property is damaged, funding is available to repair it.

(Source: Insurance Information Institute )

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Definition and meaning of FLOOD INSURANCE :

FLOOD INSURANCE: Coverage for flood damage is available from the federal government under the National Flood Insurance Program but is sold by licensed insurance agents. Flood coverage is excluded under homeowners policies and many commercial property policies. However, flood damage is covered under the comprehensive portion of an auto insurance policy. (See Adverse selection)

(Source: Insurance Information Institute )

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Definition and meaning of FOREIGN INSURANCE COMPANY :

FOREIGN INSURANCE COMPANY: Name given to an insurance company based in one state by the other states in which it does business.

(Source: Insurance Information Institute )

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Definition and meaning of FRATERNAL BENEFIT SOCIETY :

FRATERNAL BENEFIT SOCIETY*: See Fraternal insurer

(Source: Insurance Information Institute )

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