Definition and meaning of COMPREHENSIVE COVERAGE :

COMPREHENSIVE COVERAGE: Portion of an auto insurance policy that covers damage to the policyholderÕs car not involving a collision with another car (including damage from fire, explosions, earthquakes, floods and riots), and theft.

(Source: Insurance Information Institute )

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Definition and meaning of ASSIGNED RISK PLANS :

ASSIGNED RISK PLANS: Facilities through which drivers can obtain auto insurance if they are unable to buy it in the regular or voluntary market. These are the most well-known type of residual auto insurance market, which exist in every state. In an assigned risk plan, all insurers selling auto insurance in the state are assigned these drivers to insure, based on the amount of insurance they sell in the regular market. (See Residual market)

(Source: Insurance Information Institute )

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Definition and meaning of ASSETS :

ASSETS: Property owned, in this case by an insurance company, including stocks, bonds and real estate. Insurance accounting is concerned with solvency and the ability to pay claims. State insurance laws therefore require a conservative valuation of assets, prohibiting insurance companies from listing assets on their balance sheets whose values are uncertain, such as furniture, fixtures, debit balances and accounts receivable that are more than 90 days past due. (See Admitted assets)

(Source: Insurance Information Institute )

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Definition and meaning of ASSIGNMENT :

ASSIGNMENT*: An agreement under which one partyÑthe assignorÑtransfers some or all of his ownership rights in a particular property, such as a life insurance policy or an annuity contract, to another partyÑthe assignee. (See Absolute assignment; Collateral assignment)

(Source: Insurance Information Institute )

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Definition and meaning of ASSOCIATION GROUP :

ASSOCIATION GROUP*: A type of group that generally is eligible for group insurance and that consists of members of an association of individuals formed for a purpose other than to obtain insurance coverage, such as teachersÕ associations and physiciansÕ associations.

(Source: Insurance Information Institute )

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Definition and meaning of AUTO INSURANCE POLICY :

AUTO INSURANCE POLICY: There are basically six different types of coverages. Some may be required by law. Others are optional. They are:

1. 1. Bodily injury liability, for injuries the policyholder causes to someone else.: 2. 2. Medical payments or Personal Injury Protection (PIP) for treatment of injuries to the driver and passengers of the policyholderÕs car.: 3. 3. Property damage liability, for damage the policyholder causes to someone elseÕs property.: 4. 4. Collision, for damage to the policyholderÕs car from a collision.: 5. 5. Comprehensive, for damage to the policyholderÕs car not involving a collision with another car (including damage from fire, explosions, earthquakes, floods, and riots), and theft.: 6. 6. Uninsured motorists coverage, for costs resulting from an accident involving a hit-and-run driver or a driver who does not have insurance.:

(Source: Insurance Information Institute )

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Definition and meaning of ASSET-BACKED SECURITIES :

ASSET-BACKED SECURITIES: Bonds that represent pools of loans of similar types, duration and interest rates. Almost any loan with regular repayments of principal and interest can be securitized, from auto loans and equipment leases to credit card receivables and mortgages.

(Source: Insurance Information Institute )

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Definition and meaning of ARSON :

ARSON: The deliberate setting of a fire.

(Source: Insurance Information Institute )

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Definition and meaning of ANTITRUST LAWS :

ANTITRUST LAWS: Laws that prohibit companies from working as a group to set prices, restrict supplies or stop competition in the marketplace. The insurance industry is subject to state antitrust laws but has a limited exemption from federal antitrust laws. This exemption, set out in the McCarran- Ferguson Act, permits insurers to jointly develop common insurance forms and share loss data to help them price policies.

(Source: Insurance Information Institute )

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Definition and meaning of ANTISELECTION :

ANTISELECTION*: The tendency of individuals who suspect or know they are more likely than average to experience loss to apply for or renew insurance to a greater extent than people who lack such knowledge of probable loss. Also known as adverse selection and selection against the company.

(Source: Insurance Information Institute )

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Definition and meaning of APPORTIONMENT :

APPORTIONMENT: The dividing of a loss proportionately among two or more insurers that cover the same loss.

(Source: Insurance Information Institute )

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Definition and meaning of APPRAISAL :

APPRAISAL: A survey to determine a propertyÕs insurable value, or the amount of a loss.

(Source: Insurance Information Institute )

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Definition and meaning of ARBITRATION :

ARBITRATION: Procedure in which an insurance company and the insured or a vendor agree to settle a claim dispute by accepting a decision made by a third party.

(Source: Insurance Information Institute )

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Definition and meaning of AUTO INSURANCE PREMIUM :

AUTO INSURANCE PREMIUM: The price an insurance company charges for coverage, based on the frequency and cost of potential accidents, theft and other losses. Prices vary from company to company, as with any product or service.

Premiums also vary depending on the amount and type of coverage purchased; the make and model of the car; and the insuredÕs driving record, years of driving and the number of miles the car is driven per year. Other factors taken into account include the driverÕs age and gender, where the car is most likely to be driven and the times of dayÑrush hour in an urban neighborhood or leisure time driving in rural areas, for example. Some insurance companies may also use credit history related information. (See Insurance score)

(Source: Insurance Information Institute )

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Definition and meaning of AVIATION INSURANCE :

AVIATION INSURANCE: Commercial airlines hold property insurance on airplanes and liability insurance for negligent acts that result in injury or property damage to passengers or others. Damage is covered on the ground and in the air. The policy limits the geographical area and individual pilots covered.

(Source: Insurance Information Institute )

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Definition and meaning of BODILY INJURY LIABILITY COVERAGE :

BODILY INJURY LIABILITY COVERAGE: Portion of an auto insurance policy that covers injuries the policyholder causes to someone else.

(Source: Insurance Information Institute )

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Definition and meaning of BLANKET INSURANCE :

BLANKET INSURANCE: Coverage for more than one type of property at one location or one type of property at more than one location. Example: chain store

(Source: Insurance Information Institute )

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Definition and meaning of BOILER AND MACHINERY INSURANCE :

BOILER AND MACHINERY INSURANCE: Often called Equipment Breakdown, or Systems Breakdown insurance. Commercial insurance that covers damage caused by the malfunction or breakdown of boilers, and a vast array of other equipment including air conditioners, heating, electrical, telephone and computer systems.

(Source: Insurance Information Institute )

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Definition and meaning of BOND :

BOND: A security that obligates the issuer to pay interest at specified intervals and to repay the principal amount of the loan at maturity. In insurance, a form of suretyship. Bonds of various types guarantee a payment or a reimbursement for financial losses resulting from dishonesty, failure to perform and other acts.

(Source: Insurance Information Institute )

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Definition and meaning of BOND RATING :

BOND RATING: An evaluation of a bondÕs financial strength, conducted by such major ratings agencies as Standard & PoorÕs and MoodyÕs Investors Service.

(Source: Insurance Information Institute )

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Definition and meaning of BINDER :

BINDER: Temporary authorization of coverage issued prior to the actual insurance policy.

(Source: Insurance Information Institute )

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Definition and meaning of BENEFICIARY :

BENEFICIARY*: The person or legal entity the owner of an insurance policy names to receive the policy benefit if the event insured against occurs. (See Annuity beneficiary; Contingent beneficiary; Irrevocable beneficiary)

(Source: Insurance Information Institute )

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