We've listed all the relevant insurance terminology we could think of...and then some! If you don't find what you're looking for, just send us an email with your question and we'll get right back to you with the answer!
The cost of a unit of insurance as determined by insurance companies and state regulators. The rate serves as the basis for the premium.
The process by which states monitor insurance companies' rate changes, done either through prior approval or open competition models.
A policy issued at a higher premium to cover a person classified as a greater-than-average risk, usually because of impaired health or a dangerous occupation or hobby.
Six major credit agencies determine insurers' financial strength and viability to meet claims obligations and these agencies are A.M. Best Co.; Duff & Phelps Inc.; Fitch, Inc.; Moody's Investors Services; Standard & Poor's Corp.; and Weiss Ratings, Inc. These factors considered include company earnings, capital adequacy, operating leverage, liquidity, investment performance, reinsurance programs, and management ability, integrity and experience.
The insurance business is based on the spread of risk. The more widely risk is spread, the more accurately loss can be estimated.
Land and most things attached to the land such as buildings and vegetation.
A process by which the primary care physician makes a request to a managed care plan on behalf of the enrollee to receive medical care from a nonparticipating provider or specialist.
An agreement between two or more insurance companies by which the risk of loss is proportioned. Thus the risk of loss is spread and a disproportionately large loss under a single policy does not fall on one insurance company. Acceptance by an insurer, called a reinsurer, of all or part of the risk of loss of another insurance company. An insurance company issuing an automobile liability policy, with a limit of $100,000 per accident may reinsure its liability in excess of $10,000. A fire insurance company which issues a large policy generally reinsures a portion of the risk with one or several other companies.
A form of insurance that covers a policyholder's belongings against perils such as fire, theft, windstorm, hail, explosion, vandalism, riots, and others. It also provides personal liability coverage for damage the policyholder or dependents cause to third parties. It also provides additional living expenses, known as loss-of-use coverage, if a policyholder must move while his or her dwelling is repaired. It also can include coverage for property improvements. Possessions can be covered for their replacement cost or the actual cash value that includes depreciation.
Replacement Cost on Contents
This additional coverage pays for your losses on the basis of how much it would cost to replace or repair the item at current costs without deducting for depreciation. If the item is not replaced or repaired, only the actual cash value is payable.
Agreement between a buyer and seller where the seller agrees to repurchase the securities at an agreed upon time and price.
A company's best estimate of what it will pay for claims.
Residential Care Apartment Complexes
These facilities are certified by the Department of Health and Family Services (DHFS). RCACs are covered only if your policy identifies these facilities as a covered benefit and the facility has been certified as a RCAC by DHFS.
Facilities, such as assigned risk plans and FAIR Plans, that exist to provide coverage for those who cannot get it in the regular market. For this reason the residual market is also known as the shared market.
The provision of personal care, supervision, or other services to a functionally impaired person in order to temporarily relieve a family member or other primary caregiver from caregiving duties. Respite care services are usually provided in the impaired person's home or in another home or homelike setting, but may also be provided in a nursing home.
Restoration of Benefits
If you collect benefits from a policy and then recover to the point where you are not receiving care qualifying you for benefits for a certain period of time, you can have those benefits restored back to the original level. Look to see if this is a provision in the policy or if it is available as a rider for an additional premium.
The amount of risk retained by an insurance company that is not reinsured.
The reinsurance bought by reinsurers to protect their financial stability.
A method of permitting the final premium for a risk to be adjusted, subject to an agreed-upon maximum and minimum limit based on actual loss experience. It is available to large commercial insurance buyers.
Return of Premium
A rider that provides that if you die after being insured for a specified period or if you have paid premiums for a specified period, the insurance company will return premiums paid minus any benefits paid.
A document or form containing special provisions that are not contained in the policy contract. Such forms are to be added or attached to the policy.
This word has two meanings for insurers: (1) the chance of loss such as from a peril; and (2) the person or entity that is insured by a policy.
A contract payment methodology between the federal Centers for Medicare & Medicaid (CMS) and a managed care organization (for example, an HMO) that requires the delivery of at least all Medicare-covered services to members as medically necessary in return for a fixed monthly payment from the government and sometimes an additional fee paid by the enrollee. The managed care organization is then liable for those contractually offered services without regard to cost.
Management of the varied risks to which a business firm or association might be subject. It includes analyzing all exposures to gauge the likelihood of loss and choosing options to better manage or minimize loss. These options typically include reducing and eliminating the risk with safety measures, buying insurance, and self-insurance.
Risk Retention Groups
Insurance companies that come together as self-insurers and form an organization that is chartered and licensed as an insurer in at least one state to handle liability insurance.