Short Rate Short Term Insurance

Definition of "Short rate, short term insurance"

Coverage for less than one year. Insurers generally charge higher rates for short-term policies than for longer term insurance, such as an annual policy, because of the need to recoup relatively fixed administrative and processing costs over a shorter policy life; and the likelihood of adverse selection, with buyers seeking insurance only at times of the year when they know they face greatest likelihood of loss.

Search Real Estate Glossary

Related Real Estate Glossary terms

Related Real Estate FAQ