Soft Market – a buyer’s market characterized by abundant supply of insurance driving premiums down. Risk Retention Group – group-owned insurer organized for the purpose of assuming and spreading the liability risks to its members.

The employer self-funds a fixed percentage (e.g. 90%) of the estimated monthly claims, and the insurer covers the remainder. Medicaid – policies issued in association with the Federal/State entitlement program created by Title XIX of the Social Security Act of 1965 that pays for medical assistance for certain individuals and families with low incomes and resources. Major Medical – a hospital/surgical/medical expense contract that provides comprehensive benefits as defined in the state in which the contract will be delivered. Loss of Use Insurance – policy providing protection against loss of use due to damage or destruction of property. Loss Frequency – incidence of claims on a policy during a premium period. Key-Persons Insurance – a policy purchased by, for the benefit of, a business insuring the life or lives of personnel integral to the business operations.

at a premium

Disability Income – a policy designed to compensate insured individuals for a portion of the income they lose because of a disabling injury or illness. Direct Loss – Damage to covered real or personal property caused by a covered peril.

With parking space at a premium in Japanese cities, the microcar is a popular form of transport. Deposit Premium means the estimated amount determined for each Member Entity necessary to fund each layer of coverage for each Policy Year of each Program of PARSAC. This Policy is effective subject to receipt and realisation, by the Company, of the consideration payable as First Premium under the Policy.

Homeowners insurance premiums

However, risk-based premiums are determined by many risk factors, not all of which society may want to use for determining the subsidies. The point is that uniform premiums within type of plan are not compatible with this type of innovation either. Long-term equity anticipation securities are options contracts with expiration dates that are longer than one year. Sophisticated investors sometimes sell one option and use the premium received to cover the cost of buying the underlying instrument or another option. Buying multiple options can either increase or reduce the risk profile of the position, depending on how it is structured.

Excess of Loss Reinsurance – loss sharing mechanism where an insurer pays all claims up to a specified amount and a reinsurance company pays any claims in excess of stated amount. Excess and Umbrella Liability – liability coverage of an insured above a specific amount set forth in a basic policy issued by the primary insurer; or a self insurer for losses over a stated amount; or an insured or self insurer for known or https://accounting-services.net/ unknown gaps in basic coverages or self insured retentions. Direct Writer – an insurance company that sells policies to the insured through salaried representatives or exclusive agents only; reinsurance companies that deal directly with ceding companies instead of using brokers. Dental Only – line of business providing dental only coverage; coverage can be on a stand-alone basis or as a rider to a medical policy.

Average Cost of Car Insurance in August 2022

If the premium is paid in installments, it means the first installment premium. According to Royal Spanish Academy prescriptions, unadapted foreign words should be written in italics in a text printed in roman type, and vice versa, and in quotation marks in a manuscript text or when italics are not available. Premia is much less common than premiums, accounting for less than 1% of total usage in US and in UK . Usually must be paid at the time of issuing the policy, unless a different agreement is made concerning it. Relating to or denoting a commodity of superior quality and therefore a higher price. A prize, bonus, or award given as an inducement to purchase products, enter competitions initiated by business interests, etc. Because 0 is unrestricted, the level and term premiums affect the local variance of all three yields.

Total Revenue – premiums, revenue, investment income, and income from other sources. Substandard Risk – risks deemed undesirable due to medical condition or hazardous occupation requiring the use of a waiver, a special policy form, or a higher premium charge. Statutory Accounting – method of accounting standards and principles used by state regulatory authorities to measure the financial condition of regulated companies and other insurance enterprises. This method tends to be more conservative than the Generally Accepted Accounting Principles used by most businesses. Compliance with solvency and other standards is determined using financial documents prepared in accordance with Statutory Accounting Principles.

What is a Premium? Understanding Insurance Terms

It will also give you a better understanding of the average cost of insurance for your particular risk. For life insurance, other risk factors specific to the person being insured will be used as well, such as age and health conditions. For example, when looking at premiums for home insurance, What is Premium? Definition of Premium, Premium Meaning if you purchase an open perils or all-risk coverage home insurance policy, it will be more expensive than a named perils home insurance policy that only covers the basics. The cost of your insurance premium will vary depending on the type of coverage you are looking for, as well as the risk.

• Business Interruption – loss of income as a result of property damage to a business facility.
• Mila Araujo is a certified personal lines insurance broker with more than 20 years of experience in the insurance industry.
• The amount the buyer of a call or put option pays to the seller, quoted in dollars per share of stock.
• Social Insurance – compulsory insurance plan administered by a federal or state government agency with the primary emphasis on social adequacy.
• Workers’ Compensation – insurance that covers an employer’s liability for injuries, disability or death to persons in their employment, without regard to fault, as prescribed by state or federal workers’ compensation laws and other statutes.

Centers for Medicare & Medicaid Services – U.S. governmental agency responsible for the licensing of federally qualified HMOs. Carrying Value – the SAP book value plus accrued interest and reduced by any valuation allowance and any nonadmitted adjustment applied to the individual investment.

English

Admitted Company – an insurance company licensed to do business in a state, domiciled in an alternative state or country. Admitted Assets – insurer assets which can be valued and included on the balance sheet to determine financial viability of the company. The definitions in this glossary are developed by the NAIC Research and Actuarial Department staff based on various insurance references. Some words and/or phrases may be defined differently by other entities, or used in a context such that the definition shown may not be applicable. 150 Years of Collaboration Browse our timeline to learn how we support insurance regulators in their mission to protect consumers and ensure fair and healthy insurance markets.

admin