Open Competition Law
Form of state rating legislation that allows each property/liability insurer to choose between using rates set by a bureau or its own rates. Individual states regulate insurers and approve their property insurance rates. There are three methods of rate approval in addition to open competition: prior approval rating, modified prior approval rating and file and use. At one time the insurance industry operated like a cartel, with rates set by bureaus and filed with the insurance commissioners of each state. Experts believed that competition would result in either unfairly high rates or unreasonably low rates that would lead to mass insurance company insolvencies. But open competition became widespread after New York State adopted it in 1969.
Popular Insurance Terms
Same as term General Characteristics: attributes of a particular employee benefit plan. For example, a general characteristic of group life insurance is that the whole group is ...
Legal instrument posted by a contractor or craftsman to guarantee that completed work is free of flaws and will perform its intended function for a specified period of time. ...
Endorsement to a fidelity bond or surety bond to cover losses that occurred after lapse of the discovery period of the previous bond. Coverage is limited to the amount provided by the ...
Diagram used in property insurance to locate the geographical area in which risks reside. Maps are also used to reveal areas of high concentration of insured risks and their potential ...
In property insurance contracts, provision that states that the violation of one or more contract condition^) at a particular location that is insured will not void coverage at other ...
Model state law of the NAIC setting minimum standards with which insurance products must comply if they are to qualify under the definition of a long-term care (LTC) insurance policy. These ...
Intense combustion resulting in a flame or glow. In order for the fire peril to be covered under property insurance, the fire must be a hostile fire, not a friendly fire. ...
Facility that provides short periods of stay for a terminally ill person in a homelike setting for either direct care or respite. A "terminally ill" person has a life expectancy of six ...
Limited pay whole life policy under which all premium payments have been made. For example, a 20 pay policy is completely paid for after 20 payments; no future premiums have to be made, and ...
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