Policy Service Representative
Also called PSR; they are responsible for premium rating and issuing policy files.
Endorsement
A written agreement attached to the insurance policy which alters the provisions of the contract.
General Liability
Insurance to protect an owner or operator of a business from a wide range of liability exposures.
Indirect Loss
A loss resulting from a peril but not caused directly by that peril.
Pooling
The method by which each member of an insurance pool shares in every risk written by other pool members.
Underwriter
The professional responsible to assess the merits of each risk and decide a suitable premium for accepting all or part of the risk.
Tort
An injury or wrong committed against an individual.
Reserves
The funds an insurance company sets aside to pay for reported but outstanding claims.
Policy
The written insurance contract that may include all clauses, riders and endorsements.
Private Insurance
Voluntary programs that are available from the government or private firms.
Legislated
Determined by law.
Risk Retention
Retaining or bearing the risk.
Negligence
Failure to use that degree of care which an ordinary person of reasonable prudence would use to protect others from harm.
Public Adjuster
Hired by the insured, an adjuster who operates independently from insurance companies to investigate and settle claims.
Legal Hazard
Characteristics of the legal system that increase the frequency or severity of losses.
Risk
The uncertainty concerning the occurrence of a financial loss.
Physical Hazard
A physical condition that increases the chance of loss.
Liability
The obligation of financial responsibility that may arise by negligence, contract or tort committed.
Risk Transfer
Transferring the financial consequences of a loss to another party, such as an insurance company.
Premium
The price of insurance protection, paid by the policyholder to the insurer.
Risk Control Consultant
A person with expertise in risk management techniques that reduce the frequency and severity of losses.
P&C
Property and Casualty Insurance.
Loss
An undesired and unplanned reduction of financial value.
Marine Insurance
Covers loss or damage to ships, cargo or injuries to ship crew members.
Premium Auditor
Person that reviews charges to ensure that the premium paid is fair for the coverage furnished.
Loss Control
The process of identifying and acting upon situations which may lead to losses.
Underwriting
The process of scrutinizing a risk to determine whether or not to insure that risk.
Rider
An endorsement to an insurance policy that modifies its clauses and provisions, including or excluding certain conditions from coverage.
Peril
A cause of loss.
Risk Management
The identification of loss exposures and treatments for those exposures.
Morale Hazard
Carelessness or indifference to a loss because of the existence of insurance.
Risk Control
Techniques used to control the frequency and magnitude of losses.
Loss Ratio
A formula used by insurers to relate loss expenses to earned premiums.
Re-Inspector
Person who double-checks the work of the original adjuster.
Proximate Cause
The immediate or actual cause of loss or damage.
Moral Hazard
Dishonesty or character defects that increase the chance of loss.
Risk Avoidance
Avoiding the risk altogether.
Underwriting Assistant
Assists the underwriter. Also called underwriting technician or underwriting associate.
Waiver
Relinquishment of a legal right to act.
Written Premiums
The total premiums on all policies written by an insurer during a specified period of time, regardless of what portions have been earned.
Umbrella Policy
Insurance policy over and above a basic liability policy.
Insurer
The party who pays for losses in an insurance arrangement.
Coverage
The insurance afforded under a contract of insurance.
Law of Large Numbers
States that the larger the number of risks or exposures, the more closely the actual loss experience will approach the expected loss experience.
Insurance
Economic device whereby the individual or business pays a cost (premium) in exchange for protection against financial loss. The agreement is a contract also known as an insurance policy.
Exposure to Loss
The policyholder's possibility of loss.
Homeowners Policy
Insurance against property and liability perils to which a homeowner or renter is exposed.
Applicant
Prospective policyholder; completes and signs the insurance application.
Broker
Represents the interests of the insured in searching for insurance coverage at the lowest cost and highest benefit to the insured. The broker may also be an agent of the insurer for purposes of policy collection and delivery of the policy.
Claim Service Representative
Also called CSR; they are responsible for clerical completion of all claim files.
Ceding Company
The company that transfers its risk to a reinsurer. Also called the Cedant.
Independent Adjuster
An adjuster hired by the insurer to investigate and settle claims on behalf of the insurance company.
Combined Ratio
The sum of the loss ratio and the expense ratio.
Flood Insurance
Insurance to reimburse property owners from loss due to the peril of flood.
Frequency of Loss
Refers to the actual numbers or times the same or similar loss occurs.
Fire Insurance
The foundation of today's property insurance. Covers loss to property caused by a fire or lightning.
Expense Ratio
The ratio of all operating expenses divided by the premiums written.
Actuary
A professional trained in the mathematics of insurance and risk management, including the calculations of premiums, policy reserves and other values.
Indemnification
Insurance principle which states that the insured, after a loss, should be restored in whole or in part by payment, repair or replacement by the insurer.
Billing Clerk
Person responsible for revenue billing.
Disability Insurance
Covers wage loss for the disabled person.
Frequency-Severity Matrix
Matrix used to determine which type of risk treatment is appropriate for a risk.
Direct Loss
A loss which is a direct consequence of a peril.
Insured
The policyholder protected in case of a loss or claim.
Deductible
The amount of money the policyholder must pay on a loss.
Assuming Company
An insurance company that accepts the risk transferred from another insurance company in a reinsurance transaction.
Compulsory
Mandatory or enforced.
Claim Adjuster
The person who investigates insurance claims for losses and recommends an effective settlement.
Hazard
A condition that creates or increases the chance or severity of a loss due to a peril.
Commercial Lines
Insurance for businesses, professionals and commercial establishments.
