Term
CHAPTER 1
INSURANCE: WHAT IS IT?
LOSS EXPOSURE |
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Definition
ANY CONDITION OR SITUATION THAT
PRESENTS THE POSSIBILITY OF LOSS |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
LAW OF LARGE NUMBERS |
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Definition
| A MATHEMATICAL PRINCIPLE STATING THAT AS THE BUMBER OF SIMILAR BUT INDEPENDENT EXPOSURE UNITS INCREASES, THE RELATIVE ACCURACY OF PREDICTIONS ABOUT FUTURE OUTCOMES (LOSSES) BASED ON THESE EXPOSURE UNITS ALSO INCREASES |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
EXPOSURE UNIT |
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Definition
| A MEASURE OF THE LOSS EXPOSURE ASSUMED BY THE INSURER, USED IN PRICING INSURANCE |
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Term
CHAPTER 1
NSURANCE: WHAT IS IT?
PROPERTY LOSS EXPOSURE |
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Definition
| ANY CONDITION OR SITUATION THAT PRESENTS THE POSSIBILITY THAT A PROPERTY LOSS WILL HAPPEN |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
REAL PROPERTY |
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Definition
| LAND, BUILDINGS, AND OTHER STRUCTURES ATTACHED TO THE LAND OR EMBEDDED IN IT |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
PERSONAL PROPERTY |
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Definition
| ALL TANGIBLE OR INTANGIBLE PROPERTY THAT IS NOT REAL PROPERTY |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
NET INCOME |
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Definition
| REVENUE MINUS EXPENSES AND TAXES DURING A GIVEN TIME PERIOD |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
NET INCOME LOSS |
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Definition
| AN INDIRECT LOSS CAUSED BY A REDUCTION IN REVENUE, AN INCREASE IN EXPENSES, OR BOTH DURING A GIVEN TIME PERIOD |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
LIABILITY LOSS EXPOSURE |
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Definition
| ANY CONDITION OR SITUATION THAT PRESENTS THE POSSIBILITY OF A CLAIM ALLEGING LEGAL RESPONSIBILITY OF A PERSON OR BUSINESS FOR INJURY OR DAMAGE SUFFERED BY ANOTHER PARTY |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
LIABILITY LOSS |
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Definition
| A CLAIM FOR MONETARY DAMAGES BECAUSE OF INJURY TO ANOTHER PARTY OR DAMAGE TO ANOTHER PARTY'S PROPERTY |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
PERSONAL LOSS EXPOSURE |
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Definition
| ANY CONDITION OR SITUATION THAT PRESENTS THE POSSIBILITY OF A FINANCIAL LOSS TO AN INDIVIDUAL OR A FAMILY BY SUCH CAUSES OF DEATH, SICKNESS, INJURY OR UNEMPLOYMENT |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
PERSONNEL LOSS EXPOSURE |
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Definition
| ANY CONDITION OR SITUATION THAT PRESENTS THE POSSIBILITY OF A FINANCIAL LOSS TO A BUSINESS BECAUSE OF A DEATH, DISABILITY, RETIREMENT, OR RESIGNATION OF KEY EMPLOYEES |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
INDEMNIFY |
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Definition
| TO RESTORE A PARTY WHO HAS SUSTAINED A LOSS TO THE SAME FINANCIAL POSITION THAT PARTY HELD BEFORE THE LOSS OCCURRED |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
FIRE AND ALLIED LINES INSURANCE |
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Definition
| INSURANCE THAT COVERS DIRECT DAMAGE TO OR LOSS OF INSURED PR0PERTY |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
BUSINESS INCOME INSURANCE / BUS. INTERRUPTION INSURANCE |
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Definition
| INSURANCE THAT COVERS THE LOSS OF NET INCOME OR ADDITIONAL EXPENSES INCURRED BY A BUSINESS AS THE RESULT OF A COVERED LOSS TO ITS PROPERTY |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
CRIME INSURANCE |
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Definition
| INSURANCE THAT COVERS MONEY, SECURITIES, MERCHANDISE, AND OTHER PROPERTY FROM VARIOUS CAUSES OF LOSS SUCH AS BURGLARY, ROBBERY, THEFT AND EMPLOYEE DISHONESTY |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
OCEAN MARINE INSURANCE |
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Definition
| INSURANCE THAT COVERS SHIPS AND THEIR CARGO AGAINST SUCH CAUSES OF LOSS AS FIRE, LIGHTNING, AND 'PERILS OF THE SEA' |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
INLAND MARINE INSURANCE |
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Definition
| INSURANCE THAT COVERS MISCELLANEOUS TYPES OF PROPERTY, SUCH AS MOVABLE PROPERTY, GOODS IN DOMESTIC TRANSIT, AND PROPERTY USED IN TRANSPORTATION AND COMMUNICATION |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
AUTO PHYSICAL DAMAGE INSURANCE |
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Definition
| INSURANCE THAT COVERS LOSS OF OR DAMAGE TO SPECIFIED VEHICLES FROM COLLISION, FIRE THEFT, OR OTHER CAUSES |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
AUTO LIABILITY INSURANCE |
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Definition
| INSURANCE THAT COVERS AN INSURED'S LEGAL LIABILITY ARISING OUT OF THE OWNERSHIP, MAINTANANCE, OR USE OF AN AUTO |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
COMMERCIAL GENERAL
LIABILITY INSURANCE |
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Definition
| INSURANCE THAT COVERS LIABILITY LOSS EXPOSURES ARISING FROM A BUSINESS ORGANIZATION'S PREMISE AND OPERATION, ITS PRODUCTS, OR ITS COMPLETED WORK |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
PERSONAL LIABILITY INSURANCE |
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Definition
| INSURANCE THAT PROVIDES LIABILITY COVERAGE TO THE INDIVIDUALS AND FAMILIES FOR BODILY INJURY AND PROPERTY DMG ARISING FROM THE INSURED'S PERSONAL PREMISE OR ACTIVITIES |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
PROFESSIONAL LIABILITY INSURANCE |
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Definition
| INSURANCE THAT PROVIDES LIABILITY COVERAGE TO PROFESSIONALS FOR ERRORS AND OMISSIONS ARISING OUT OF THEIR PROFESSIONAL DUTIES |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
WHOLE LIFE INSURANCE |
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Definition
| LIFE INSURANCE THAT PROVIDES LIFETIME PROTECTION, ACCRUES CASH VALUE, AND HAS PREMIUMS THAT REMAIN UNCHANGED DURING THE INSURED'S LIFETIME |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
CASH VALUE |
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Definition
| THE MONETARY AMOUNT, CONSIDERED TO BE A FORM OF SAVINGS, THAT ACCUMULATES IN A WHOLE LIFE INSURANCE POLICY |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
TERM INSURANCE |
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Definition
| LIFE INSURANCE THAT PROVIDES COVERAGE FOR A SPECIFIED PERIOD, SUCH AS TEN OR TWENTY YEARS, WITH NO CASH VALUE |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
UNIVERSAL LIFE INSURANCE |
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Definition
| INSURANCE THAT PROVIDES LIFE INSURANCE PROTECTION AND A SAVINGS COMPONENT |
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Term
CHAPTER 1
INSURANCE: WHAT IS IT?
MEDICAL INSURANCE |
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Definition
| INSURANCE THAT COVERS MEDICAL EXPENSES THAT RESULT FROM ILLNESS OR INJURY |
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