Suspension Of Coverage
Interruption of insurance provided for in most property insurance policies under circumstances where a substantial increase in hazard has arisen with the knowledge or control of the insured. The policy's work and materials clause gives the insured the right to use materials and processes needed in his or her business without facing suspension from increased hazard. But major changes in the characteristics of the risk will trigger suspension of coverage. For example, a building used to warehouse dry goods when fire insurance first is written on it may be converted by the insured to store paint. The substantial increase in hazard results in suspension of coverage. Vacancy for more than 60 days and riot or explosion also result in suspension. Coverage is reinstated automatically for the remainder of the policy term when the condition that triggered suspension is corrected.
Popular Insurance Terms
Policy of variable universal life insurance (VUL) under which, if the accumulation of the premiums paid at any point in time (minus policy loans, and withdrawals) equals or exceeds the ...
Mortality table, morbidity table that does not include current statistical experience. ...
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Institutional investment sold by life insurance companies that guarantees principal and offers withdrawal flexibility. This conservative investment, which can be used with a corporate ...
Measure of the rate at which policies are cancelled or allowed to lapse. The termination rate is a factor in setting premiums for group life and health policies. ...
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Nominal interest rate minus the rate of inflation. ...
Terms specifying obligations of an insured to keep a policy in force. For example, an insured must pay the premiums due; in life insurance, if death occurs, the beneficiary or the insured's ...
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