Probability
Chance that an event will occur. The foundation of insurance is probability and statistics. By pooling a large number of homogeneous exposures an insurance company can predict with a given degree of accuracy the chance that a policyholder will incur a loss. The company reflects this expectation in the pure cost of insurance, known as the pure premium.
Popular Insurance Terms
Length of time insurance policy is in force. ...
One of four SEC divisions charged with regulating investment companies, investment advisers, and variable insurance products. The SEC requires variable insurance products to register with ...
Action (s) that the insured must take, or continue to take, for the insurance policy to remain in force and the insurance company to process a claim. For example, the insured must pay the ...
Same as term Contingent Business Income Coverage Form: coverage for loss in the net earnings of a business if a supplier business, subcontractor, key customer, or manufacturer doing ...
Same as term Annuity: contract sold by insurance companies that pays a monthly (or quarterly, semiannual, or annual) income benefit for the life of a person (the annuitant), for the lives ...
Percentage of total assets set aside by an insurance company to provide for unexpected losses. In general, a minimum of a 5% surplus ratio (5 cents in reserve for each $1 of assets) is ...
Home office underwriter who evaluates risk based on probability, statistics, and medical knowledge. ...
Property valued according to its earnings potential. However, property insurance contracts generally indemnify an insured on a replacement cost less physical depreciation and obsolescence ...
Ordinary life insurance that generates a first year cash value from the payment of the first year premium. Using this cash value, loans could be made to finance premiums due in the future, ...
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