Glossary – Stratinsure

? Absolute Liability :

Liability for damages even though fault or negligence cannot be proven.

? Accident :

An event or occurrence which is unforeseen and unintended. Accidental Bodily Injury: Injury to the body as the result of an accident.

? Accidental Death Insurance:

Insurance that provides coverage in the event of death due to accidental injuries, but not illness. In the event of death, payment is made to the insured's beneficiary. If bodily injury occurs (e.g., the loss of a limb), the insured receives a sum specified by the contract.

? Act of God:

Legal term meaning some sudden and irresistible act of nature that could not reasonably have been foreseen or prevented, such as floods or exceptionally high tides, storms, lightning, earthquakes, sharp frosts, or sudden death. Damage by such an occurrence may be attributed to the act of God, and in the absence of any contract to the contrary, no person can be held liable for it. Nearly all insurance forms and shipping charter parties, and most contracts, have a clause relating to nonliability in the case of an act of God.

? Actual Cash Value :

A common clause in property insurance contracts that determines the coverage amount based on the fair market value of an item at the time it was damaged, stolen, or destroyed.

? Actuary :

A person professionally trained in the technical aspects of pensions, insurance and related fields. A specialist in the mathematics of risk, especially as it relates to insurance calculations such as expectancy, premiums, dividends, and annuity rates. The actuary estimates how much money must be contributed to an insurance or pension fund in order to provide for the future.

? Adhesion :

This is a characteristic of a unilateral contract which is offered on a "take it or leave it" basis. Most insurance policies are contracts of "adhesion," because the terms are drawn up by the insurer and the insured simply "adheres." For this reason ambiguous provisions are often interpreted by courts in favor of the insured. Contrast with Manuscript Policy.

? Adjuster : (a)

A person who investigates and settles losses for an insurance carrier. (b) Individual employed by a property/casualty insurance company to settle claims brought by insureds. The adjuster evaluates each claim and then makes recommendations to the insurance company.

? Administrator :

An individual or professional organization, such as a bank's trust department, appointed by the court to administer an estate when the owner dies without having made a will or without nominating an executor. An executor may also be appointed if the named executor declines to serve.

? Age Limits :

Stipulated minimum and maximum ages below and above which the company will not accept proposals or may not renew policies.

? Agent :

An licensed insurance company representative who solicits, negotiates or effects contracts of insurance, and provides service to the policyholder for the insurer.

? 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. In India, none of the health insurance policies cover this ailment.

? Alien :

An individual who is not a citizen or national of a particular country. Aliens are further defined as resident or nonresident depending on the situation.

? Alimony :

Support payable to a divorced spouse as required by a divorce decree or legal separation agreement.

? All-risks Policy :

Coverage by an insurance contract that promises to cover all losses except those losses specifically excluded in the policy.Also known as open peril coverage.

? Appraisal :

A professional, formal, written estimation of the value of property.

? Appreciation :

Increase over time in the value of an asset such as a commodity, or real estate. My be taken as opposite to depreciation.

? Arson :

The willful and malicious burning of, or attempt to burn, any structure or other property, often with criminal or fraudulent intent.

? Assignment :

The legal transfer of one person's interest in an insurance policy to another person.

? Assets :

Property owned by a business, institution, or individual, such as cash, investments, personal property, real estate, and ownership in a business, that has a present market value or worth.

? Assigned Risk Plan :

Automobile insurance in which individuals who cannot obtain conventional liability coverage because of their poor driving records are placed in a residual market with insurance companies assigned to write policies for them at higher prices. These plans protect motorists who suffer injury or property damage through the negligence of bad drivers who otherwise would not have insurance.

? Assignee:

The party to whom an assignment (a transfer of property or rights to property) has been granted. At-Risk: Property and assets exposed to the danger of loss.

? Avoidance :

A risk management technique whereby a situation or activity that may result in a loss for a firm is avoided or abandoned.

? 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.

? Basic Limit :

Usually refers to Liability policies and indicates the lowest amount for which a policy can be written. This amount is either prescribed by law or company policy

? Beneficiary :

An individual designated in a will to receive an inheritance, or the individual designated to receive the proceeds of an insurance policy, retirement account, trust, or other asset.

? Benefits :

The amount payable by the insurance company to a claimant, assignee or beneficiary under each coverage.

? Binder :

An agreement executed by an agent or insurer (usually the latter) putting insurance into force before the contract has been written or the premium paid.

? Book Value:

Refers to the value of assets as shown in the official accounting records of the company.

? Borderline Risk :

An insurance prospect of doubtful quality from an underwriting point of view.

? Bordereaux :

This is a schedule of risks ceded by the ceding company to the treaty during a certain period and giving details of sum insured, location, rate of premium, etc. It is sent to the reinsurer at regular intervals and he thus knows what are the risks being insured and weather the cessions are within the terms of the treaty.

? Broker :

One who represents an insured in the solicitation, negotiation or procurement of contracts of insurance, and who may render services incidental to those functions. By law the broker may also be an agent of the insurer for certain purposes such as delivery of the policy or collection of the premium.

? Broker :

? Brokerage : (i)

The fee or commission received by a broker.(ii) Insurance placed by brokers contrasted with that placed by agents

? Brokerage Business :

Business offered to an insurer by a broker. This is sometimes called excess or surplus business

? Brokerage Department :

A department of an insurer whose purpose is to deal with brokers in the placing of insurance.

? Broker-Agent :

One acting as an agent of one or more insurers and as a broker in dealing with one or more other insurers

? Bullion :

Refers to precious metals, such as gold, in the form of ingots or bars.

? Burglary :

Breaking and entering into another person's property with felonious intent which is external with visible, violent entry or exit.

? Burglary and Theft Insurance:

Coverage against property losses due to burglary, robbery, or larceny. Burning Ratio: The ratio of losses suffered to the amount of insurance in effect.

? CIF :

Abbreviation for cost, insurance, and freight or charged in full. Many countries value their imports on this basis, whereas exports are usually valued f.o.b. (free-on-board). For balance of payments purposes, figures are usually adjusted to include the freight and insurance costs.

? Cancellation :

The discontinuance of an insurance policy before its normal expiration date, either by the insured or the Insurance Company.

? Capacity :

Capacity : The largest amount of insurance or reinsurance available from a company. In a broader sense, it can refer to the largest amount of insurance or reinsurance available in the marketplace. The largest amount of insurance or reinsurance available from a company. In a broader sense, it can refer to the largest amount of insurance or reinsurance available in the marketplace.

? Captive Agent:

One who sells insurance for only one company as opposed to an agent who represents several companies.

? Captive Insurance Company:

A company owned solely or in large part by one or more non- insurance entities for the primary purpose of providing insurance coverage to the owner or owners.

? Captive Insurer :

Insurance company established and owned by a parent firm in order to insure its loss exposures while reducing premium costs, providing easier access to a reinsurer, and perhaps easing tax burdens.

? Capital sum insured :

It is the sum insured of a Person for which cover is sought under a Personal Accident Policy

? Claim Settling Agents:

They are appointed abroad for survey/settlement of claims arising out of policy issued in the home country. For example, Overseas mediclaim, marine insurance policies are serviced in this fashion

? Cumulative Bonus :

The percentage at which the sum insured gets increased annually, without additional premium, e.g.. Personal Accident Insurance, Mediclaim Insurance.

? Cargo Insurance ::

Type of ocean marine insurance that protects the shipper of the goods against financial loss if the goods are damaged or lost.

? Casualty Insurance :

Insurance concerned with the insured's legal liability for injuries to others or damage to other persons' property; also encompasses such forms of insurance as plate glass, burglary, robbery and workmen’s' compensation.

? Catastrophe :

Event which causes a loss of extraordinary magnitude, such as a hurricane or tornado.

? Cede :

To transfer all or part of a risk written by an insurer (the ceding, or primary company) to a reinsurer.

? Cession :

ceded to a reinsurer by the original insuring company in a reinsurance operation

? Claim-made policy :

A liability insurance policy under which coverage applies to claims filed during the policy period.

? Coffee house :

Alternative to ale-houses as social meeting place, largely for the professional classes, popular in the 17thand18thcenturies.Christopher Bowman opened the first Coffee House in London (later known as the `Pasqua Rosee´) in St. Michael's Alley, Cornhill, 1652 and others soon followed in both London and Oxford so that by 1708 London alone boasted 3,000 coffee houses. Their popularity stemmed from their reputations as centres for the dissemination of news and ideas, making them good places to meet others of a like mind and also to conduct business. For this reason, coffee houses were often associated with radical readings and an attempt was made to suppress them by royal proclamation 1675 but the coffee houses were too popular and the attempt was abandoned within amatter of days. Many coffee houses attracted a particular group or profession and built their reputations and clientelearound a certain business. For example, London underwriters specializing in marine insurance began to meet regularly in Edwin Lloyd's coffee house from about 1688 and the place was so heavily associated with that business that it gave its name to the Lloyds insurance market. The coffee houses declined in popularity toward the end of the 18th century as coffee itself was largelysuperseded by the new fashion for tea.

? Commission :

The part of an insurance premium paid by the insurer to an agent or broker for his services in procuring and servicing the insurance.

? Comprehensive Motor Insurance :

Protection against loss resulting from damage to the insured motor vehicle including the third party Insurance.

? Contractual Liability :

Legal liability of another party that the business firm agrees to assume by a written or oral contract.

? Contract :

A binding agreement between two or more parties for the doing or not doing of certain things. A contract of insurance is embodied in a written document called the policy.

? Contribution :

It is the principle of insurance of insurance by which the insured is prevented from recovering more then his loss, despite his having several insurance policies.

? Consequential Loss :

Financial loss occurring as the consequence of some other loss. Often called an indirect loss

? Consideration :

One of the elements for a binding contract. Consideration is acceptance by the insurance company of the payment of the premium and the statement made by the prospective policyholder in the application.

? Compulsory Insurance :

Any form of insurance which is required by law. e.g., Motor third party insurance, Public Liability Act Insurance.

? Cover Notes:

A cover note is a document issued in advance pending the issue of the policy and is normally required if the policy cannot for some reason or other be issued straight away. Cover notes can also be issued during negotiations to provide cover on a provisional basis. A cover note is not a stamped document but is honored, all the same, by all parties concerned.

? Cut Rate :

This term generally applies to insurance companies who charge premiums below a normal or average rate.

? Declination :

The insurer's refusal to insure an individual after careful evaluation of the application for insurance and any other pertinent factors.

? Deductible :

An amount which a policyholder agrees to pay, per claim or per accident, toward the total amount of an insured loss.

? Deflation :

An economic period characterized by falling prices, high unemployment and a generally sluggish or slow economy.

? Degree of Risk :

The amount of uncertainty that exists in a given situation. For instance, if you've chosen heads in the flip of a coin, the degree of risk present is 50%, since there is a 50% chance any flip of the coin will come up tails.

? Dependent :

An individual who depends on another for support and maintenance.

? Depreciation :

A decrease in the value of property over a period of time due to wear and tear or obsolescence. Depreciation is used to determine the actual cash value of property at time of loss.

? Disability :

A condition that curtails to some degree a person's ability to carry on his normal pursuits. A disability may be partial or total, and temporary or permanent

? Domiciliary Hospitalization :

When the Doctor feels that a patient can be treated at Home or if a patient desires to get treated at Home or if no room is there at the Hospital, then treatment given at Home is called Domiciliary Hospitalization.

? Double Insurance :

If the insurance policy is taken from more than one underwriter where period of insurance, subject matter of insurance and sum insured are same, then this is called double insurance.

? Endorsements :

Endorsements are used normally when the terms of an insurance contract are to be varied. Endorsements are attached to the policy document and the two together constitute the evidence of the insurance contract. Endorsements may be issued during the currency of the policy e.g. when alterations in the risks are to be recorded. They could also be issued at the time of the issue of the policy to provide specific exclusion from the cover or specific extension to include an additional peril. Endorsements are issued on standard forms, or are separately typed, or are written on the policy itself.

? Excess (also refer Deductibles ) :

Agreed amount upto which no claim is paid under a policy

? Excess of loss Reinsurance( also refer to XL cover):

This is a method of reinsurance whereby the direct insurer fixes an amount upto which he is prepared to suffer losses as a result of any one event (or any one risk) in any class or classes of business and arranges reinsurance for a predetermined consideration so as to be relieved of any loss, which he may sustain arising out of an event or any risk.

? FOB :

Abbreviation for free-on-board, used in commerce to describe the value of goods at point of embarkation, excluding transport and insurance costs. Export values are usually expressed f.o.b. for customs and excise purposes, while imports are usually valued c.i.f.

? Facultative Reinsurance:

A type of reinsurance in which the reinsurer can accept or reject any risk presented by an insurance company seeking reinsurance.

? Fidelity Bond :

A form of protection which reimburses an employer for losses caused by dishonest or fraudulent acts of employees. Fiduciary: A person who holds something in trust for another.

? Financial reinsurance :

It is a mixture of banking and reinsurance products. It is among the new, non-traditional solutions of alternative risk transfer (ART). In financial reinsurance, for example, the client pays a higher premium, which - in addition to the customary reinsurance procedure - is invested and earns interest for the client. Thus, the client has an extended cover that finances itself over the course of time. Financial reinsurance meets clients' needs for long-term planning and balancing cash flow and resources. The cover is limited over the entire, multi-year term of the treaty; the transfer of risk during the period of the treaty is of less significance. One elaboration of financial reinsurance is finite risk reinsurance, which is developing rapidly, particularly in the US.

? Finite risk reinsurance:

It is an elaboration of financial reinsurance and numbers among the products in the alternative risk transfer markets (ART). This type of reinsurance is also a combination of risk transfer and risk financing - but involves more risk transfer than financial reinsurance, in which the current value of money assumes special significance. One feature of finite risk reinsurance is its multi-year term, which allows clients a longer-term cover at calculable costs. Another feature of finite risk reinsurance is that a substantial portion of the profits accruing over a multi-year period is reimbursed to clients. Lastly, the income expected from investments is taken into account in calculating the premium. The main forms of finite risk reinsurance are: loss portfolio transfers (LPTs), in which the direct insurer transfers claims provisions to the finite reinsurer; adverse development covers (ADCs), in which the direct insurer acquires covers that extend beyond the claims provisions formed; finite quota shares (FQSs), which are covers that include the business of the current and of future underwriting years; and spread loss treaties (SLTs), which are used to manage financial risks associated with the time of payment

? Floaters :

Insurance policies that cover property that can be moved from one location to another for both transportation perils and perils affecting property at a fixed location.

? Flood Insurance :

Coverage against loss resulting from flood.

? General Average :

In ocean marine insurance, a loss incurred for the common good that is shared by all parties to the venture.

? General Damages :

Damages awarded to an injured person for intangible loss which cannot be measured directly by dollars. Popularly known as "pain and suffering." General damages are distinguished from special damages which are awarded for actual economic loss, such as medical costs, loss of income, etc.

? Hazard :

Condition that creates or increases the chance of loss.

? Heavy risk (for Personal Accident Insurance) :

It relates to People in engaged in occupations like motor racing, big game hunting, horse riding, pilots, crew of aircraft etc.

? Hedging :

Technique for transferring the risk of unfavorable price fluctuations to a speculator by purchasing and selling options and futures contracts on an organized exchange. Hull Insurance: (1) Class of ocean marine insurance that covers physical damage to the ship or vessel insured. Typically written on an "all-risks" basis. (2) Physical damage insurance on aircraft- similar to collision insurance in an automobile policy.

? House Breaking :

When the theft is committed entering into or out of the premises stealthily.

? Hurricane :

A tropical storm marked by extremely low barometric pressure and circular winds with a velocity of 120 miles an hour or more.

? Illegal Contract:

It is a contract, which is contrary to law and against the interests of public. It cannot be sustained and does not have legal effect.

? Imputed Negligence:

Case in which responsibility for damage can be transferred from the negligent party to another person, such as an employer.

? Incurred Claims:

Incurred claims equal the claims paid during the policy year plus the claim reserves as of the end of the policy year, minus the corresponding reserves as of the beginning of the policy year. The difference between the year end and beginning of the year claim reserves is called the increase in reserves and may be added directly to the paid claims to produce the incurred claims.

? Incurred-but-not-reported (IBNR) :

reserves: liability account on an insurer's balance sheet reflecting claims that are expected based upon statistical projections but which have not yet been reported to the insurer.

? Indemnification:

Compensation to the victim of a loss, in whole or in part, by payment, repair, or replacement. Indemnity: Legal principle that specifies an insured should not collect more than the actual cash value of a loss but should be restored to approximately the same financial position as existed before the loss.

? Independent Adjuster:

Claims adjuster who offers his or her services to insurance companies and is compensated by a fee.

? Indexing :

Adjusting of values over time to reflect the impact of inflation.

? Indirect Loss :

See Consequential Loss.

? Individual Insurance :

Policies which provide protection to the policyholder and/or his/her family. Sometimes called Personal Insurance as distinct from group and blanket insurance.

? Insurability :

Acceptability to the company of an applicant for insurance.

? Insurable Interest :

It gives the owner the right to insure the property, to protect himself against financial loss. Without insurable interest, the contract of insurance will be void, that is, it will not come into existence. Because of this legal requirement of insurable interest, insurance contracts are not gambling transactions.

? Insurable Risk :

The conditions that make a risk insurable are (a) the peril insured against must produce a definite loss not under the control of the insured, (b) there must be a large number of homogeneous exposures subject to the same perils, (c) the loss must be calculable and the cost of insuring it must be economically feasible, (d) the peril must be unlikely to affect all insureds simultaneously, and (e) the loss produced by a risk must be definite and have a potential to be financially serious.

? Insurance:

(1) A system under which individuals, businesses, and other organizations or entities, in exchange for payment of a sum of money (a premium), are guaranteed compensation for losses resulting from certain perils under specified conditions. (2) Protection by written contract against the financial hazards (in whole or in part) of the happenings of specified fortuitous events.

? Insurance Company:

(1) An organization chartered to operate as an insurer.
(2) Any corporation primarily engaged in the business of furnishing insurance protection to the public.

? Insured :

A person or organization covered by an insurance policy, including the "named insured" and any other parties for whom protection is provided under the policy terms.

? Insurer :

Insurer : The party to the insurance contract who promises to pay losses or benefits. Also, any corporation engaged primarily in the business of furnishing insurance to the public.

? Intermediary or Insurance Intermediary (as defined in IRDA Act,1999) :

Includes insurance brokers, reinsurance brokers, insurance consultants, surveyors and loss assessors.

? Key-Person Insurance :

Insurance designed to protect a business firm against the loss of income resulting from the death or disability of a key employee.

? Larceny-theft :

The unlawful taking, carrying, leading or riding away of another person's property.

? Law of Large Numbers :

The law of large numbers, discovered around the year 1700 by Jakob Bernoulli, the mathematics professor and co-discoverer of probability theory, forms the basis of the modern insurance industry: While it is impossible to predict either the time or the loss amount of adverse events in relation to individuals, the averages for a sufficiently large set (of insureds) exhibit certain patterns of loss frequency and loss extent

? Legal liability :

Any liability imposed on a person by a court of law

? Legal Reserve :

The minimum reserve which a company must keep to meet future claims and obligations as they are calculated under the state insurance code.

? Liability :

Any legally enforceable obligation.

? Liability Insurance :

Insurance covering the policyholder's legal liability resulting from injuries to other persons or damage to their property. Liability Insurance: Provides protection for the insured against loss arising out of legal liability to third parties.

? Liability Limits

: The stipulated sum or sums beyond which an insurance company is not liable to protect the insured.

? Lloyd's of London :

insurance marketplace where brokers, representing clients with insurable risks, deal with Lloyd's underwriters, who in turn represent investors. The investors are grouped together into syndicates that provide capital to insure the risks.

? Load :

To add charges to an insurance premium

? Loading :

The amount that must be added to the pure premium for expenses, profit, and a margin for contingencies.

? Loss :

The happening of the event for which insurance pays

? Loss Loss Prevention :

Any measure which reduces the probability or frequency of a particular loss but does not eliminate completely all possibility of that loss

? Loss Ratio :

A ratio calculated by dividing claims into premiums. It may be calculated in several different ways, using paid premiums or earned premiums, and using paid claims with or without changes in claim reserves and with or without changes in active reserves

? Loss Reserve :

The amount set up as the estimated cost of a claim.

? Lloyd's of London :

International insurance market and centre of shipping intelligence, based in London. Lloyd's was established in 1688 and named after Edward Lloyd, whose coffee-house was a meeting place for those interested in shipping. Lloyd's accounts for half of all international insurance premiums underwritten in the London market. Lloyd's moved into a new building in the City of London, designed by the architect Richard Rogers, in 1986Members of Lloyd's (known as ` names´) are organized into syndicates, and pledge personal fortunes in return for premiums. There is no limit to a name's liability, but risks are spread among the members of a syndicate, so that no individual takes too great a personal risk. However, during the late 1980s and early 1990s, Lloyd's suffered a series of losses (Piper Alpha, Hurricane Hugo, the Exxon Valdez oil spill, European storms in 1990)), and many names faced large bills to meet the insurance cover. 1988 saw the first loss (£510 million) since 1967. Some names took Lloyd's to court, but a financial settlement was reached in 1996. Famous risks undertaken by the company include the Titanic, the Lutine (whose bell, salvaged in 1859, is at the Lloyd's headquarters), and space satellites.

? Lutine :

British bullion ship that sank in the North Sea in 1799. Its bell, salvaged in 1859, is at the headquarters in Lloyd's of London, the insurance organization. It is sounded once when a ship is missing and twice for good news.

? Material Facts :

The facts which influence the judgement of the insurer in deciding.

? Named Perils :

Coverage in a property policy that provides protection against loss from only the perils specifically listed in the policy rather than protection from physical loss. Examples of named perils are fire, windstorm, theft, smoke, etc.

? Negligence :

Failure to use the care that a reasonable and prudent person would have used under the same or similar circumstances

? No-claims bonus :

A reduction in the price of an insurance policy because no claims have been made on it

? Nuclear energy insurance :

It covers property damage, liability and accident risks entailed in the operation of nuclear installations.

? Ombudsman (History) :

Swedish `commissioner´ - Official who acts on behalf of the private citizen in investigating complaints against the government. The post is of Scandinavian origin; it was introduced in Sweden 1809, Denmark 1954, and Norway 1962, and spread to other countries from the 1960s. The first Commonwealth country to appoint an ombudsman was New Zealand 1962; the UK followed 1966 with a parliamentary commissioner; and Hawaii was the first US state to appoint an ombudsman, 1967. The UK Local Government Act 1974 set up a local ombudsman, or commissioner for local administration, to investigate maladministration by local councils, police, health or water authorities. In the 1980s, ombudsmen were appointed to private bodies such as banks 1986, insurance companies 1983, and building societies 1988.

? Ombudsman :

An authority established either by the company or the Government for the quick redressal of grievances.

? Package Policy :

A combination of two or more individual polices or coverages into a single policy. A householder's policy, for example, is a package combining property, liability and theft coverages for the homeowner

? Partial Disability :

The result of an illness or injury which prevents an insured from performing one or more of the functions of his/her regular job. Peril: The cause of a loss insured against in a policy.

? Peril :

The cause of a possible loss, such as fire, windstorm, theft, explosion, or riot.

? Personal Lines :

Those types of insurance, such as auto or home insurance, for individuals or families rather than for businesses or organizations.

? Pluvius insurance, pluvius policy :

An insurance policy to cover damage sustained through bad weather

? Policy :

The printed legal document stating the terms of the insurance contract that is issued to the policyholder by the company.

? Policy Term :

That period for which an insurance policy provides coverage.

? Policyholder:

The person who owns a life insurance policy. This is usually the insured person, but it may also be a relative of the insured, a partnership or a corporation.

? Pollution Liability :

Exposure to lawsuits for injury or cleanup costs that result from pollution damage

? Pool :

An organization of insurers or reinsurers through which particular types of risk are underwritten and premiums, losses and expenses are shared in agreed-upon amounts.

? Preexisting Condition:

A physical and/or mental condition of an insured which first manifested itself prior to the issuance of his/her policy or which existed prior to issuance and for which treatment was received.

? Preexisting Condition :

A physical condition that existed before the effective date of coverage.

? Premium :

The sum paid by a policyholder to keep an insurance policy in force. It is the amount paid to secure an insurance policy

? Probationary Period :

A period from the policy date to a specified time, usually 15 to 30 days, during which no sickness coverage is effective. It is designed to eliminate a sickness actually contracted before the policy went into effect.

? Product Liability Insurance :

Protection against financial loss arising out of the legal liability incurred by a manufacturer, merchant, or distributor because of injury or damage resulting from the use of a covered product.

? Professional Indemnity :

It is a cover granted to professionals like Doctors covering their legal liability for any claims arising out of professional misconduct.

? Proof of Loss :

Documentary evidence required by an insurer to prove a valid claim exists. It usually consists of a claim form completed by the insured and the insured's attending physician. For medical expense insurance itemized bills must also be included.

? Proportional Reinsurance:

In proportional reinsurance, the reinsurer assumes a percentage of the liability which the direct insurer accepted from the insured and, for this service, receives a corresponding percentage of the premium. In the event of a claim, the reinsurer is proportionately liable, it must pay the same percentage of the claim as it received in the premium. Through proportional treaty reinsurance, direct insurers can protect themselves against major fluctuations in the loss experience of entire portfolios due to economic cycles, new legislation or social change (risk of change and risk of random fluctuation).

? Proposal :

A person interested in taking out insurance has to make an offer by means of a proposal. This is an application for the cover required, or for obtaining quotations of the premium chargeable. The proposal may be made verbally, in writing or by completing the company's proposal form.

? Proximate Cause :

The dominating cause of loss or damage; an unbroken chain of events between the occurrence and damage.

? Punitive Damages :

Punitive Damages : a court-awarded amount that exceeds the economic losses and general damages of a defendant and is intended solely to punish the plaintiff

? Provision :

A part (clause, sentence, paragraph, etc.) of an insurance contract that describes or explains a feature, benefit, condition, requirement, etc. of the insurance protection afforded by the contract.

? Property Insurance :

Insurance providing financial protection against the loss of, or damage to, real and personal property caused by such perils as fire, theft, windstorm, hail, explosion, riot, aircraft, motor vehicles, vandalism, malicious mischief, riot and civil commotion, and smoke.

? Quota Share Reinsurance :

It is an automatic reinsurance, whereby the ceding company is bound to cede a fixed percentage of every risk written by it irrespective of the size or quality of the risk.

? Reinsurance :

It is the operation of the insurance company again insuring its commitments elsewhere with another insurance company. Thus, a reinsurance transaction is an agreement made between two parties, called ceding company and reinsurer, whereby the ceding company agrees to cede and the reinsurer agrees to accept a certain share of risk upon terms as set out in the agreement. The ceding company is the original insurance company, which has accepted the risk, and which cedes part of that risk to a reinsurer, which is either another insurance company or a reinsurance company, which accepts that part of the risk, which is ceded.

? Repatriation Expenses :

(under Overseas Mediclaim) Expenses incurred to travel back to home country following sickness abroad.

? Retrocession :

It is the practice of the reinsurers to again reinsure their acceptance in order to protect their own portfolio and to spread the risk as wide as possible.

? Risk :

It can be a potential source of loss or the subject matter of insurance itself.

? Run-off management :

It is the handling of claims from cancelled insurance and reinsurance covers, particularly where loss experience has been adverse. Many reinsurers like Swiss Re offers run-off management as a service to the insurance industry, processing orphaned claims efficiently and aiding clients to clear their balance sheets through the transfer of loss portfolios.

? Ship-broker :

1. one who transacts all necessary business for a ship when in port. 2. a marine insurance agent.

? Short period rates :

Percentage of annual premiums charged for short period policies

? Subrogation :

It is defined as the transfer of rights and remedies of the insured to insurers who have indemnified the insured in respect of the loss.

? Umbrella Liability :

Insures losses in excess of amounts covered by other liability insurance policies; also protects the insured in many situations not covered by the usual liability polices.

? Underwriter :

1) a company that receives the premiums and accepts responsibility for the fulfillment of the policy contract; 2) the company employee who decides whether or not the company should assume a particular risk.

? Underwriting :

The process of selecting risks for insurance and determining in what amounts and on what terms the insurance company will accept the risk.

? Underwriting Profit or Loss :

The amount of money which an insurance company gains or loses as a result of its insurance operations. It excludes investment transactions and federal income taxes

? Unearned Premium :

The portion of a premium that a company has collected but has yet to earn because the policy still has unexpired time to run.

? Unenforceable Contract :

This is one, which lacks some evidential features. The contract is a valid one otherwise, but could not be enforced in a court of law.

? Uninsurable Risk :

One not acceptable for insurance due to excessive risk.

? Void Contract :

A contract obtained by fraud is a void contract. It is not a contract at all. Under this there cannot be any action as no rights or obligation are cast on the parties to the contract.

? Proof of Loss :

? Voidable Contract :

A contract, which is valid until it is treated as void by the aggrieved party, is a voidable contract. Obviously in such an event the insurer would be the aggrieved party and has the option to repudiate liability.

? Warranties :

Warranties are expressly stated in the policy to ensure that the insured shall not do a particular thing. They protect insurers against any increase in the risk after the issue of the policy. Whether or not breach of warranty is material to the loss, the insurers have a right to repudiate the loss.

? Weekly benefits (for Personal Accident Insurance):

They are paid for the period of temporary total disablement following an injury which is admissible under the policy and usually 1% of Capital Sum Insured per week subject to a maximum of 104 weeks.

? Will :

A document that, when signed and witnessed, gives legal effect to the wishes of an individual, called a testator, to provide for the disposal of property upon death.

? Workmen's' Compensation Insurance :

Workmen's' Compensation Insurance : Insurance against liability imposed on certain employers to pay benefits and furnish care to employees injured, and to pay benefits to dependents of employees killed in the course of or arising out of their employment.

? XL Reinsurance (a.k.a.Excess of Loss Reinsurance) :

? Zurich :

Swiss Re's head office has been located in Zurich since the company was formed in 1863, and on the banks of Lake Zurich on Mythenquai since 1913. Today, Greater Zurich has a population of about one million. The city on the River Limmat is home to a large number of major banks and insurance companies. Zurich is also the home of the Swiss Exchange, one of the largest in Europe.