Finite Risk Insurance
Type of insurance that provides a single aggregate limit of coverage within the insurance policy terms, thereby limiting the insurance company's liability for a risk transferred to it. The insurance coverage is tailored to the requirements of the insured company to reflect the insured's actual coverage needs. If the insured's losses are favorable, the insured receives the return of a portion of the premium paid. The insured's premium costs are based on the insured's own loss experience, rather than the overall loss experience of a pool of similar insureds. In essence, through this type of insurance, the insured pays for exposure to loss and if there is not a substantial loss, the insured receives the return of a portion of the premium paid in. This insurance mechanism is ideal for insureds who exhibit a frequency distribution of high severity loss or an unusual loss frequency.
Popular Insurance Terms
Money set aside in some states to pay otherwise uncompensated bodily injury claims to innocent victims of automobile accidents. The claimants must prove that they were not at fault and that ...
Policies generally available to the various professions that require protection for negligent acts and/or omissions resulting in bodily injury, personal injury, and/or property damage ...
Correction of a contract containing a mistake in order to prevent a party to that contract from gaining from that mistake. For example, if $1,000,000, instead of the correct amount of ...
Type of surety bond that is either a fiduciary or a court bond. Fiduciary Bond guarantees that individuals in a position of trust will safeguard assets belonging to others placed under ...
Specified limit on the dollar amount of coverage for a given loss. ...
Insurance company that does not utilize the rates and policies of a rating bureau. ...
Traditional insurance plan under which the patient can select the physician and hospital of his or her choice. The patient is responsible for paying the co-payment and the deductible and ...
Procedure in employee benefit plans to calculate life insurance and retirement benefits to which an employee is entitled. ...
System of classifying face amount of policies according to size within a given range. The premium rate per $1,000 of face amount varies on a declining basis. As the face amount increases, ...
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