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
Confirmation by an insurance company of the acts of its agent, regardless of whether or not these acts were committed within the limit of authority granted the agent by the company. By so ...
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Chart showing rate of death at each age in terms of number of deaths per thousand. ...
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New pension-accounting rule created by the Financial Accounting Standards Board. The objective of this rule is to clarify pension accounting so that investors, employers, and employees will ...
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