Small Loss Principle
Definition of "Small loss principle"
Statement regarding an insured's retention of low-severity risks because they are not catastrophic, and can be absorbed without having a dramatic effect on the financial structure of a business or individual. Insurance purchased for small-loss coverage is, in effect, swapping dollars with the insurance company, since the premium charged reflects the individual's expected losses plus loadings for the insurance company's expenses, profit margin, and contingencies.
Popular Insurance Terms
Bonds that are secured by mortgage securities classified as either interest only or principal only strips (separate trading of registered interest and principal of securities). Insurance ...
Coverage if transmission equipment is damaged or destroyed on an all risks basis excluding the perils of war, wear and tear, inherent defect, and nuclear damage, consequential loss ...
Investments restricted to short-term financial instruments issued by state, city, and county governments and agencies. Interest paid by those instruments are not subject to federal income ...
Coverage for equipment normally carried from location to location by a physician or surgeon; written on an all risks basis to include supplies and scientific books used in medical practice. ...
Compensation payable to the owner of a ship detained for reasons beyond his or her control who incurs a loss of earnings because of the delay. Detainment can be caused by a delay in the ...
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Payment to a broker, master general agent, general agent, or agent on any particular line of insurance written by other agents within a particular geographical area. ...
Limited special purposes policy that provides liability and physical damage insurance for owners and operators of trucks while engaged in business. This insurance is often purchased by a ...
Enacted on April 1, 1997; provides protection against creditors for irrevocable trusts provided that the trust has a grantor who is a discretionary beneficiary. In order for the statute of ...
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