|
Home Page
Company Ratings
Apply
Paramed Exam
LongTermCare
OurProfile
Our Mission
ContactUs
Glossary
Table of Contents
Member of the Better Business Bureau
| |
|
|
 | Absolute Liability: Liability for
damages even though fault or negligence cannot be proven.
| Accident: An event or occurrence which is
unforeseen and unintended.
| Accident and Health
Insurance: A type of coverage that pays benefits, sometimes
including reimbursement for loss of income, in case of sickness,
accidental injury, or accidental death.
| Accident Insurance: A form of
health insurance against loss by accidental bodily injury.
| Accidental Bodily Injury:
Injury to the body as the result of an accident.
| Accidental Death Benefit: A
benefit in addition to the face amount of a life insurance policy,
payable if the insured dies as the result of an accident. Sometimes
referred to as "double indemnity."
| Accounting: The process of recording,
summarizing, and allocating all items of income and expense of the
company and analyzing, verifying, and reporting the results.
| Accumulation period: 1) The time
between the first premium payment and the first benefit payout under a
deferred annuity; 2) A specified period of time, such as 90 days,
during which the insured person must incur eligible medical expenses
at least equal to the deductible amount in order to establish a
benefit period under a major medical expense or comprehensive medical
expense policy.
| Accumulation units: The mechanism
used to account for your "deposits" in a variable annuity
contract during the premium paying period. The number of units
purchased depends upon the current valuation of a unit in dollars.
| Acquisition Costs: The insurer's
cost of putting new business in force, including the agent's
commission, the cost of clerical work, fees for medical examinations
and inspection reports, sales promotion expense, etc.
| Activities of Daily Living:
A list of activities, normally including mobility, dressing, bathing,
toileting, transferring, and eating which are used to assess degree of
impairment and determine eligibility for some types of insurance
benefits.
| Actual Cash Value (ACV): 1)
The cost of replacing or restoring property at prices prevailing at
the time and place of the loss, less depreciation, however caused; 2)
replacement cost minus.
| Actuarial Cost Method: One of
several systems for determining either the contributions to be made
under a retirement plan, or level of benefits when the contributions
are fixed. In addition to forecasts of mortality, interest and
expenses, some of the methods involve estimates of future labor
turnover, salary scales and retirement rates.
| Actuarial Equivalent: If the
present values of two series of payments are equal, taking into
account a given interest rate and mortality according to a given
table, the two series are said to be actuarially equivalent on this
basis. For example, a lifetime monthly benefit of $67.60 beginning at
age 60 (on a given set of actuarial assumptions) can be said to be the
actuarial equivalent of $100 a month beginning at age 65. The actual
benefit amounts are different but the present value of the two
benefits, considering mortality and interest, is the same.
| Actuarially Fair: The price for
insurance which exactly represents the expected losses
| Actuary: A person professionally trained in
the technical aspects of pensions, insurance and related fields. The
actuary estimates how much money must be contributed to an insurance
or pension fund in order to provide future
| Additional insured: an assured
party specifically named under an insurance policy
| Adhesion, Contract of: A
contract that is drafted by one party and accepted or rejected by the
other, with no opportunity to bargain with respect to its terms.
| Adjustable Life Insurance: A
type of insurance that allows the policyholder to change the plan of
insurance, raise or lower the face amount of the policy, increase or
decrease the premium and lengthen or shorten the protection period.
| Adjusted gross estate:
Approximately the net worth of the deceased--the beginning point for
the computation of estate taxes.
| Adjuster: A person who investigates and
settles losses for an insurance carrier.
| Adjusting: The process of investigating and
settling losses with or by an insurance carrier.
| Adjustment Bureau: Organization for
adjusting insurance claims that is supported by insurers using the
bureau's services.
| Administrative
Services Only (AS0) Plan: An arrangement under which an insurance
carrier or an independent organization will, for a fee, handle the
administration of claims, benefits and other administrative functions
for a self-insured group.
| Advance Funding: Pension-funding
method in which the employer systematically and periodically sets
aside funds prior to the employee's retirement.
| Advance Premium Mutual: Mutual
insurance company owned by the policyowners that does not issue
assessable policies but charges premiums expected to be sufficient to
pay all claims and expenses.
| Adverse Selection: The tendency of
persons who present a poorer-than-average risk to apply for, or
continue, insurance to a greater extent than do persons with average
or better-than-average expectations of loss.
| Age Limits: Stipulated minimum and maximum
ages below and above which the company will not accept applications or
may not renew policies.
| Agent: An insurance company representative
licensed by the state who solicits, negotiates or effects contracts of
insurance, and provides service to the policyholder for the insurer.
| Aggregate Deductible: Deductible
in some property and health insurance contracts in which all covered
losses during a year are added together and the insurer pays only when
the aggregate deductible amount is exceeded.
| Aggregate Indemnity: The maximum
dollar amount that may be collected for any disability or period of
disability under the policy.
| AIDS: Acquired immune deficiency syndrome. A
fatal, incurable disease caused by a virus that can damage the brain
and destroy the body's ability to fight off illness.
| Alien Insurer: An insurance company
domiciled in another country.
| Allied Lines: A term for forms of
property insurance allied with fire insurance, covering such perils as
windstorm, hail, explosion, and riot.
| Allocated Benefits: Benefits for
which the maximum amount payable for specific services is itemized in
the contract.
| All-risks Policy: Coverage by an
insurance contract that promises to cover all losses except those
losses specifically excluded in the policy. See also: Risks of direct
loss to property.
| Alternate Delivery Systems:
Health services provided in other than an in-patient, acute-care
hospital. Examples include skilled and intermediary nursing
facilities, hospice programs, and home health care. Alternate delivery
systems are designed to provide needed services in a more
cost-effective manner.
| Ambulatory Care: Medical services that
are provided on an outpatient (nonhospitalized) basis. Services may
include diagnosis, treatment, and rehabilitation.
| Amendment: A formal document changing the
provisions of an insurance policy signed jointly by the insurance
company officer and the policy holder or his authorized
representative.
| Amortization: Paying an interest-bearing
liability by gradual reduction through a series of installments, as
opposed to one lump-sum payment.
| Annual Statement: The annual report,
as of December 31, of an insurer to a state insurance department,
showing assets and liabilities, receipts and disbursements, and other
financial data.
| Annuitant: The person during whose life an
annuity is payable, usually the person to receive the annuity.
| Annuity: A contract that provides an income
for a specified period of time, such as a number of years or for life.
| Annuity Certain: A contract that
provides an income for a specified number of years, regardless of life
or death.
| Annuity Consideration: The
payment, or one of the regular periodic payments, an annuitant makes
for an annuity.
| Antiselection: The tendency of persons
who present a poorer-than-average risk to apply for, or continue,
insurance to a greater extent than do persons with average or
better-than-average expectations of loss.
| Application: A signed statement of facts
made by a person applying for life insurance and then used by the
insurance company to decide whether or not to issue a policy. The
application becomes part of the insurance contract when the policy is
issued. Arbitration">Arbitration: A form of alternative
dispute resolution where an unbiased person or panel renders an
opinion as to reponsibility for or extent of a loss.
| Arson: The willful and malicious burning of, or
attempt to burn, any structure or other property, often with criminal
or fraudulent intent.
| Assessment Association: An
insurer that does not charge a fixed premium for insurance, but rather
assesses its members periodically to pay its losses. Assessment
insurers usually collect an advance premium which is estimated to
cover losses and expenses, but reserve the right to make additional
assessments whenever the premium collected is insufficient.
| Assessment Mutual: Mutual insurance
company that has the right to assess policyowners for losses and
expenses.
| Assets: All funds, property, goods, securities,
rights of action, or resources of any kind owned by an insurance
company. Statutory accounting, however, excludes non-admitted assets,
such as deferred or overdue premiums, that would be considered assets
under generally accepted accounting principles (GAAP).
| Assignment: The legal transfer of one
person's interest in an insurance policy to another person.
| Association Captive: Type of
captive insurer owned by members of a sponsoring organization or
group, such as a trade association.
| Association Group: A group formed
from members of a trade or a professional association for group
insurance under one master health insurance contract.
| Association Group Plan: Health
insurance plans designed for members of a professional association or
trade association. Members may be protected under a group health
insurance policy or by individual franchise policies.
| Assumption of Risk Doctrine:
Defense against a negligence claim that bars recovery for damages if a
person understands and recognizes the danger inherent in a particular
activity or occupation.
| Assumptions: Conditions and rules
underlying the calculation of a pension benefit, including expected
interest, mortality and turnover.
| Assurance Insurance: These terms
are today generally accepted as synonymous, although not originally
so. The term "assurance" is used more commonly in Canada and
Great Britain than in the United States.
| Attachment point:
the dollar amount of loss where an insurance begins to provide
coverage
| Attractive Nuisance: Condition
that can attract and injure children. Occupants of land on which such
a condition exists are liable for injuries to children.
| Automatic Premium Loan: Cash
borrowed from a life insurance policy's cash value to pay an overdue
premium after the grace period for paying the premium has expired.
| Automatic Reinsurance: An
agreement that the insurer must cede and the reinsurer must accept all
risks within certain explicitly defined limits. The reinsurer
undertakes in advance to grant reinsurance to the extent specified in
the agreement in every case where the ceding company accepts the
application and retains its own limit.
| Automobile Insurance Plan:
One of several types of "shared market" mechanisms where
persons who are unable to obtain such insurance in the voluntary
market are assigned to a particular company, usually at a higher rate
than the voluntary market. Formerly called "Assigned Risk."
| Automobile Liability
Insurance: Protection for the insured against financial loss
because of legal liability for car-related injuries to others or
damage to their property.
| Automobile Physical
Damage Insurance: Coverage to pay for damage to or loss of an
insured automobile resulting from collision, fire, theft, or other
perils.
| Automobile Reinsurance
Facility: One of several types of "shared market"
mechanisms used to make automobile insurance available to persons who
are unable to obtain such insurance in the regular market.
| Automobile Shared Market: A
program in which all automobile insurers in each state and the
District of Columbia participate to make coverage available to car
owners who are unable to obtain auto insurance in the voluntary
market. Except in Maryland, which operates a state-funded mechanism
whose losses are subsidized by private insurers, each state uses one
of three systems (an automobile insurance plan, a joint underwriting
association, or a reinsurance facility) to guarantee the availability
of automobile insurance.
| Aviation Insurance: Aircraft
insurance including coverage of aircraft or their contents, the
owner's liability, and accident insurance on the
passengers.Beneficiary: The person designated or provided for by the
policy terms to receive any benefits provided by the policy or plan
upon the death of the insured.
| Average Indexed
Monthly Earnings (AIME): Under the OASDI program, the person's
actual earnings are indexed to determine his or her primary insurance
amount (PIA).
| Avoidance: see Loss Avoidance. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
|
