Commercial Insurance Glossary
386 plain-English definitions of commercial-insurance terms. Reviewed by Jason Wootton, our licensed P&C Insurance Agent (NPN 7694718).
Auto / Specialty · 1 term
Aviation / Liability · 1 term
Benefits / Health · 1 term
Bond · 4 terms
A Fidelity Bond reimburses a business for losses caused by dishonest acts of employees — theft, embezzlement,…
A Payment Bond guarantees that a contractor will pay subcontractors, suppliers, and laborers on a project. Of…
A Performance Bond guarantees that a contractor will complete a project according to contract terms. Required…
A Surety Bond is NOT insurance — it's a financial guarantee that you'll complete contracted work and comply w…
Certificates · 1 term
Claims · 21 terms
An appraisal clause is a property policy provision that resolves disputes over the amount of a covered loss —…
An assignment of benefits is a document by which an insured transfers their claim rights and the right to col…
Bad faith is an insurer's unreasonable failure to honor its claims-handling obligations to a policyholder, su…
A Claimant is the party making a claim under an insurance policy — either the policyholder (a first-party cla…
A Claims Adjuster is the insurance professional who investigates a claim, evaluates the damages or loss, appl…
A constructive total loss occurs when damaged property is not literally destroyed but the cost to repair it e…
A coverage denial is an insurer's formal decision that a claim is not covered by the policy, stating the spec…
An Examination Under Oath (EUO) is a formal, recorded, sworn question-and-answer session that an insurer's at…
Extra-contractual obligations (ECO) are liabilities an insurer incurs beyond the stated policy limits because…
First notice of loss (FNOL) is the initial report a policyholder makes to their insurer that a loss, accident…
A first-party claim is one the policyholder files for its own loss under its own policy; a third-party claim…
Indemnity is compensation that restores a party for a loss — or a contractual promise to repay another party…
Loss adjustment expense (LAE) is the cost an insurer incurs to investigate, defend, and settle a claim — such…
A loss run is a carrier-produced report of a business's historical claim activity — for each claim, the date…
A proof of loss is a formal, usually sworn statement a policyholder submits to the insurer documenting the am…
A public adjuster is a state-licensed claims professional the policyholder hires to prepare, document, and ne…
A reservation of rights is a notice an insurer sends after a claim, stating it will investigate or defend but…
Salvage is the residual value an insurer recovers from damaged or destroyed property after it pays a claim, t…
A settlement and release is an agreement that resolves a claim in which the claimant accepts a payment and, i…
Subrogation is the right of your insurer, after paying a claim on your behalf, to step into your shoes and pu…
A total loss occurs when insured property is destroyed or so badly damaged that the cost to repair it meets o…
Claims / Legal · 2 terms
Claims-Made Concept · 1 term
Classification · 4 terms
Admitted carriers are licensed by state insurance regulators and backed by state guaranty funds. Non-admitted…
E&S Lines are commercial insurance markets that write coverage admitted carriers won't — high-risk classes, l…
NAIC Code (North American Industry Classification System) is a 6-digit code that identifies your business's i…
SIC (Standard Industrial Classification) is the older 4-digit US industry classification system, largely repl…
Commercial Auto · 14 terms
Collision covers damage to your vehicle from collision with another vehicle or object, regardless of fault.
Combined Single Limit (CSL) is a single dollar limit that covers bodily injury + property damage combined per…
Commercial uninsured/underinsured motorist (UM/UIM) coverage pays for the insured's bodily injury, and in som…
Comprehensive covers damage to your vehicle from non-collision causes: theft, vandalism, fire, hail, falling…
A drive other car (DOC) endorsement extends a business auto policy to cover named individuals, and often thei…
The fellow employee exclusion is a business auto and general liability provision that bars coverage for one e…
Garage liability is a specialized commercial policy that combines auto liability and premises/operations liab…
Hired auto physical damage coverage pays for collision, comprehensive, and other physical damage to vehicles…
MVR is a driver's state-issued driving history. Commercial Auto carriers underwrite based on the combined MVR…
Non-trucking liability (NTL), often called bobtail insurance, covers a truck's liability when it is driven fo…
Permissive use is the principle that a person driving a covered auto with the named insured's permission qual…
Trailer interchange insurance covers physical damage to a trailer that is in your possession under a written…
The truckers coverage form (ISO CA 00 12) and its successor, the motor carrier coverage form (ISO CA 00 20),…
Usage-based insurance (UBI) is auto coverage priced from actual driving data — miles driven, hard braking, sp…
Commercial Auto / Liability · 1 term
Commercial Auto & Property Valuation · 1 term
Commercial Auto & Trucking · 1 term
Commercial General Liability · 1 term
Commercial Property · 4 terms
The Causes of Loss Form is the ISO commercial property attachment that defines which perils a policy covers.…
Newly Acquired or Constructed Property is an automatic extension in a commercial property policy that tempora…
Open perils (also called all-risk or special form) covers loss from any cause except those specifically exclu…
Tenant's betterments and improvements are fixtures, alterations, or additions a tenant pays to install in lea…
Contractors · 8 terms
An action-over claim is a lawsuit in which an injured employee who has already collected workers compensation…
A completed operations tail is the extended window of liability coverage that responds to bodily injury or pr…
Contractors Pollution Liability (CPL) is a specialty policy that covers third-party bodily injury, property d…
A residential work exclusion is a general liability endorsement that removes or limits coverage for bodily in…
Subcontractor Default Insurance (SDI) is first-party insurance a general contractor buys to protect itself ag…
A sunset clause is a policy provision that sets a firm deadline — often a set number of years after the polic…
A tool and equipment floater is an inland-marine policy that covers a contractor's hand tools, power tools, a…
A wrap-up is a single consolidated insurance program that covers most or all contractors and subcontractors o…
Coverage Form · 1 term
Coverage Type · 22 terms
Builders Risk covers buildings under construction — materials, fixtures, and equipment on a job site — until…
Business Income coverage pays your lost revenue + ongoing expenses when a covered Property loss forces tempor…
Business Interruption Insurance (also called Business Income Insurance) covers lost net income and continuing…
A Business Owners Policy (BOP) bundles General Liability + Commercial Property + Business Income into one pol…
Commercial Auto covers vehicles used for business purposes — owned, leased, or hired. Personal auto policies…
Commercial Crime Insurance covers losses from employee theft, fraud, forgery, robbery, computer fraud, and fu…
Commercial Flood Insurance covers flood damage — explicitly EXCLUDED from standard Commercial Property and BO…
CGL is the formal name for the standard General Liability policy — Commercial General Liability. The ISO CGL…
A Commercial Package Policy (CPP) is a customizable bundle of any commercial coverages — GL, Property, Busine…
Commercial Property covers YOUR own property — building (if owned), business contents, equipment, inventory,…
Commercial Umbrella sits ABOVE General Liability + Commercial Auto + Employers Liability (WC Part B) — provid…
Cyber Extortion Coverage is a component of Cyber Liability insurance that pays for ransom demands, negotiator…
Cyber Liability covers data breach response costs, customer notification, regulatory penalties, and lawsuits…
Data Breach Insurance covers the costs a business incurs after a data security incident — notification to aff…
D&O covers personal liability of directors and officers for governance decisions, fiduciary breach, donor law…
EPLI covers claims by employees for wrongful termination, discrimination, harassment, or retaliation.
General Liability (GL) insurance covers third-party claims of bodily injury, property damage, and personal/ad…
Inland Marine covers high-value tools, equipment, and movable business property — whether at your shop, in tr…
Motor Truck Cargo Insurance covers the value of goods/freight being transported by a commercial vehicle — dis…
Pollution Liability covers cleanup costs and third-party claims for spills, contamination, or environmental d…
Professional Liability — also called Errors & Omissions (E&O) — covers claims of professional mistakes, bad a…
Workers Compensation (WC) is a state-mandated insurance that pays medical bills and lost wages when employees…
Crime · 1 term
Cyber · 3 terms
Bricking coverage is a cyber-policy extension that pays to replace or repair hardware and connected devices r…
Reputational harm coverage is a cyber-insurance extension that reimburses income lost to customer attrition —…
System failure coverage is a cyber-insurance enhancement that pays for business-interruption income loss and…
Cyber / Crime · 1 term
Cyber / Media · 1 term
Cyber / Privacy · 2 terms
Distribution · 6 terms
A Captive Agent represents a single insurance carrier exclusively. They typically work directly for that carr…
An Independent Agent represents multiple carriers, allowing them to compare quotes across markets to find the…
An insurer — commonly called a carrier — is the insurance company that underwrites and issues a policy, colle…
A managing general underwriter is a specialized intermediary that an insurer delegates authority to underwrit…
A Managing General Agent (MGA) is a specialty wholesaler that has carrier authority to underwrite, bind, and…
A Surplus Lines Broker is a state-licensed intermediary who places insurance with non-admitted (Excess & Surp…
Distribution / Agency · 7 terms
An agency cluster or network is a group of independent agencies that band together to pool their premium volu…
An aggregator or master agency gives smaller agencies access to carrier markets, higher commission tiers, and…
Binding authority is delegated power that lets an agent, MGA, or coverholder commit a carrier to coverage — b…
A book roll or book transfer is the en-masse movement of a whole block of policies from one carrier or agency…
A direct writer is an insurance carrier that sells its policies through its own employees or exclusive captiv…
Program business is a specialized book of similar risks — one industry or exposure type — underwritten under…
A retail broker works directly with the insured to shop and place coverage, while a wholesale broker is an in…
Document · 3 terms
An ACORD Certificate of Liability Insurance is a standardized one-page form (ACORD 25) that summarizes the ac…
A Certificate of Insurance (COI) is a one-page document issued by your carrier proving you have specified ins…
The Declarations Page is the first page (or first few pages) of an insurance policy that lists the named insu…
Endorsement · 13 terms
Additional Insured is a third party (landlord, client, vendor) named on your liability policy as also being c…
Additional Insured gets limited coverage rights on someone else's policy (typically for a specific operation)…
Earthquake Coverage is a separate endorsement or policy covering earthquake damage — explicitly EXCLUDED from…
Equipment Breakdown covers mechanical or electrical failure of business equipment — boilers, HVAC, computers,…
Garage Keepers Liability covers customer vehicles in your custody on your lot — theft, vandalism, weather dam…
HNOA extends Commercial Auto coverage to vehicles your business uses but doesn't own — employees' personal ve…
Liquor Liability covers claims arising from alcohol service — over-serving a customer who then injures someon…
MCS-90 is a federal financial responsibility endorsement required for interstate for-hire trucking under FMCS…
On-Hook covers damage to a vehicle being towed by your tow truck. Explicitly EXCLUDED by standard Commercial…
Ordinance or Law coverage pays the increased cost of rebuilding to current code when an older building is dam…
Primary and Noncontributory is a contract requirement that your liability policy must pay BEFORE any other po…
Products-Completed Operations covers claims that arise from products you sold or work you completed (after th…
Waiver of Subrogation prevents your insurer from suing a third party (typically a landlord or contracting par…
Environmental / Pollution · 5 terms
Lead-based paint liability covers bodily-injury claims alleging harm from exposure to lead paint — most often…
Mold or fungi liability covers bodily injury, property damage, and remediation claims arising from mold, fung…
Pollution legal liability (PLL) is a broad environmental policy line that covers both first-party (an insured…
Site pollution liability (also called fixed-site or premises pollution) covers cleanup costs, third-party bod…
Storage tank liability covers cleanup costs and third-party bodily injury and property damage caused by leaks…
Exclusion · 1 term
Filing · 4 terms
BMC-91 is the FMCSA filing that proves you carry minimum financial responsibility for interstate for-hire tru…
MC Authority is the operating authority granted by FMCSA to motor carriers transporting passengers or freight…
A rate filing is the submission a carrier or rating bureau makes to a state Department of Insurance — usually…
USDOT Number is a federal registration number required for any commercial vehicle > 10,001 lbs GVWR operat…
Financial · 10 terms
An AM Best Rating is a financial-strength grade, expressed on a letter scale from A++ down to D, that measure…
Captive insurance is a licensed insurance company that a business (or group of businesses) owns and controls…
A ceding commission is a fee the reinsurer pays back to the ceding (primary) insurer to reimburse it for the…
The expense ratio is the share of premium an insurer spends on underwriting expenses — agent commissions, gen…
Facultative reinsurance is reinsurance negotiated separately for a single specific risk or policy, rather tha…
Policyholder surplus is an insurer's total admitted assets minus its total liabilities under statutory accoun…
Reinsurance is insurance that an insurance company buys to transfer part of the risk it has assumed to anothe…
Risk-based capital is a regulatory formula that sets the minimum amount of capital an insurer must hold based…
Statutory accounting principles are the conservative, regulator-mandated accounting rules U.S. insurers use t…
Treaty reinsurance is a single agreement under which a reinsurer automatically covers an entire category or b…
General · 2 terms
General Liability · 5 terms
A standard Commercial General Liability policy carries two separate annual aggregate limits: the general aggr…
Owners and Contractors Protective (OCP) liability is a standalone general liability policy that an owner or g…
Personal and advertising injury is Coverage B of the standard commercial general liability policy. It pays fo…
Premises and operations liability is the part of a commercial general liability policy that covers bodily inj…
Product liability insurance covers a business's legal liability for bodily injury or property damage caused t…
Health / Employee Benefits · 8 terms
The ACA employer mandate is the Affordable Care Act's employer shared-responsibility rule requiring applicabl…
An Administrative Services Only (ASO) arrangement is a contract in which an insurance carrier or third-party…
COBRA continuation coverage is a federal requirement that employers with 20 or more employees let qualified b…
An HSA (Health Savings Account) is an employee-owned, tax-advantaged account paired with a qualified high-ded…
A level-funded health plan is a hybrid self-funded arrangement in which a small employer pays a fixed, predic…
Minimum essential coverage (MEC) is the baseline level of health coverage under the Affordable Care Act that…
Reference-based pricing (RBP) is a self-funded health-plan cost strategy that caps provider reimbursement at…
A self-funded health plan is one in which the employer pays employees' medical claims directly out of its own…
Hospitality · 1 term
Inland Marine · 5 terms
Accounts receivable coverage is inland marine insurance that pays for sums a business cannot collect from cus…
Bailee's customer insurance is inland marine coverage that pays for physical loss of or damage to customers'…
Electronic data processing (EDP) coverage is an inland marine floater for computer hardware, media, and store…
Fine arts coverage is all-risk inland marine insurance for paintings, sculptures, antiques, and collectibles,…
Valuable papers and records coverage is inland marine insurance that pays the cost to research, reconstruct,…
Inland Marine / Contractors · 2 terms
Inland Marine / Logistics · 1 term
Inland Marine / Specialty · 1 term
Legal · 11 terms
The anti-subrogation rule is a legal doctrine that bars an insurer from pursuing a subrogation claim against…
Contractual liability is the legal responsibility a business voluntarily takes on by signing a contract — mos…
A cross-liability exclusion is policy language that addresses whether one insured can sue or make a claim aga…
An escape clause is a type of other-insurance provision that voids a policy's coverage entirely when other va…
An excess clause is an other-insurance provision that makes a policy pay only after all other applicable insu…
A hold harmless agreement is a contract clause in which one party agrees to assume the other's liability and…
In an indemnity or hold harmless agreement, the indemnitee is the party being protected from loss, and the in…
An insured contract is a specific, defined category of agreement — such as a lease of premises, an easement,…
An other-insurance clause is standard policy language that determines how a policy responds when more than on…
Severability of interests is a policy provision that treats each insured separately, applying the coverage as…
A statute of limitations is the legally fixed deadline by which a lawsuit or covered claim must be filed, aft…
Liability · 9 terms
The absolute pollution exclusion is a broad commercial general liability provision that eliminates coverage f…
Broad Form Property Damage (BFPD) is a coverage grant that carves back part of a general liability policy's p…
The fortuity principle is the fundamental requirement that an insured loss be accidental, fortuitous, and unc…
Horizontal vs. vertical exhaustion describes two competing rules for the order in which insurance layers must…
The impaired-property exclusion is a standard commercial general liability provision that removes coverage fo…
The known loss rule is the principle that a loss already known or in progress when coverage is purchased is n…
A per-project aggregate is a general liability endorsement that gives each construction project its own separ…
Stacking of limits is the combining of coverage limits from more than one policy, policy period, or coverage…
The your-work exclusion is a CGL provision that removes coverage for property damage to the insured's own com…
Liability / Real Estate · 1 term
Limits · 5 terms
Aggregate Limit is the maximum your policy will pay for ALL claims combined in a policy year.
Per-Occurrence Limit is the maximum your policy will pay for a single claim or incident.
A self-insured retention (SIR) is a dollar amount specified in a liability policy that the insured must pay f…
Split Limit is an alternative to CSL where bodily injury and property damage have separate dollar limits — ty…
A sublimit is a limitation within a policy that caps the coverage available for a specific type of loss. It i…
Management / Benefits Liability · 1 term
Management Liability · 7 terms
Derivative demand coverage is a Directors & Officers (D&O) grant that reimburses the reasonable costs a compa…
Entity coverage is the part of a directors-and-officers (D&O) policy — its Side C insuring agreement — that p…
Representations and warranties insurance (RWI) is a transactional policy used in mergers and acquisitions tha…
Side A, B, and C are the three insuring agreements in a directors-and-officers (D&O) policy: Side A protects…
Third-party EPLI is an employment-practices-liability extension that covers harassment and discrimination cla…
Wage-and-hour defense is a sublimited EPLI extension that pays the legal defense costs of Fair Labor Standard…
A wrongful act is the defined trigger in claims-made management-liability policies — an actual or alleged err…
Marine / Liability · 1 term
Policy Form · 15 terms
A Claims-Made policy responds when a claim is FILED during the policy period — not when the incident occurred…
A Consent to Settle clause requires the insurer to obtain the insured's approval before settling a claim. Pro…
Defense costs can be paid in ADDITION to the policy limit (outside — better) or COUNTED AGAINST the limit (in…
Drop-Down Coverage is an Umbrella feature where the umbrella drops down to provide primary coverage for claim…
Duty to Defend means the insurer pays defense costs from the moment a claim is filed — even if the claim is l…
An exclusion is a policy provision that identifies specific hazards, perils, circumstances, property, or loss…
Extended Reporting Period (ERP) — also called Tail Coverage — extends the claim-filing window after a Claims-…
Follows Form means an Umbrella or Excess policy adopts the terms, conditions, and exclusions of the underlyin…
A Hammer Clause gives the insurer the right to settle a claim against the insured's wishes — limiting the ins…
ISO Forms are standardized commercial insurance policy forms drafted by the Insurance Services Office and use…
A Monoline policy covers a single line of insurance — General Liability ONLY, or Commercial Auto ONLY, etc. O…
A Named Insured is a person or organization specifically listed on the policy declarations as an insured part…
An Occurrence policy responds to incidents that occurred during the policy period, even if claims are filed y…
Prior Acts Coverage (also called Nose Coverage) extends a Claims-Made policy backward to incidents that occur…
Retroactive Date is the earliest date back to which a Claims-Made policy will respond. Critical when switchin…
Policy Provisions · 1 term
Policy Structure · 2 terms
Policy Terms & Conditions · 1 term
Process · 2 terms
Professional / Tech · 1 term
Professional Liability · 6 terms
Accountants errors and omissions (E&O) insurance is professional liability coverage for CPAs, bookkeepers, an…
Architects and engineers errors and omissions insurance is professional liability coverage for design firms t…
Home inspector errors and omissions (E&O) insurance is professional liability coverage that protects inspecto…
Lawyers professional liability (legal malpractice) insurance is a claims-made policy that pays defense costs…
Medical malpractice insurance is professional liability coverage for healthcare providers, protecting against…
Real estate errors and omissions (E&O) insurance is professional liability coverage for agents, brokers, and…
Property · 19 terms
Actual Cash Value (ACV) is the lesser of repair cost OR replacement cost minus depreciation.
Agreed value is a property valuation arrangement in which the insurer and insured agree in advance on a fixed…
An anti-concurrent causation (ACC) clause is policy language that bars coverage for a loss whenever an exclud…
A brands and labels clause lets an insured remove its brand name or labels from damaged but salvageable goods…
Builders risk soft costs coverage pays the indirect, non-construction expenses—such as loan interest, archite…
Business personal property (BPP) is the movable, tangible property a business owns or is responsible for — in…
Coinsurance is a Commercial Property requirement to insure to at least 80% (sometimes 90%) of replacement cos…
Concurrent causation is a coverage doctrine that applies when two or more perils — at least one covered and o…
Debris removal coverage pays the cost of cleaning up and hauling away the debris of insured property after a…
Extra expense coverage pays the additional costs a business incurs to keep operating (or resume faster) after…
Functional replacement cost is a property valuation method that pays to rebuild or repair damaged property us…
Green upgrade coverage is a property endorsement that pays the extra cost to rebuild or repair with environme…
A loss payee is a party named in a property policy to receive claim payment for its financial interest in the…
A peak season endorsement temporarily increases a business's property limit on inventory (business personal p…
A protective safeguards endorsement is a property policy condition requiring the insured to maintain specifie…
Replacement Cost coverage pays to replace damaged property with new equivalent. Actual Cash Value (ACV) pays…
Rip and tear coverage pays the cost to access, remove, and replace otherwise undamaged property in order to r…
A selling price clause values a manufacturer's or merchant's finished, sold stock at its selling price rather…
Utility service interruption coverage pays for loss a business suffers when off-premises utility service — su…
Property / BI · 1 term
Property / Catastrophe · 2 terms
Property / Inland Marine · 2 terms
Property / Real Estate · 1 term
Property / Structure · 1 term
Property & Inland Marine · 1 term
Rating · 19 terms
Additional premium is the extra amount an insurer bills after the fact — most commonly when a premium audit r…
The combined ratio is an insurer's core measure of underwriting profitability: incurred losses plus expenses…
A credibility factor is a weighting, between 0 and 1, that determines how much of an insured's own loss histo…
Deposit premium is the estimated premium a policyholder pays upfront on an auditable policy, based on project…
Developed premium is the premium remaining after experience and schedule modifiers are applied to the manual…
The exposure basis is the unit of measurement an insurer uses to price a policy — such as payroll, gross sale…
A loss cost (or pure premium) is the portion of an insurance rate that covers expected claims for a class of…
A loss cost multiplier (LCM) is the factor a carrier applies to a bureau's advisory loss cost to build its ow…
A loss ratio is an insurer's incurred losses divided by premiums earned — how much of every premium dollar is…
Manual premium is the base premium calculated by multiplying an insurer's published manual rate by the exposu…
Payroll limitation is a state-set cap on how much of an executive officer's, partner's, or sole proprietor's…
A premium surcharge is an extra charge added to a policy's base premium to fund a specific cost, program, or…
Profit and contingencies is a loading built into filed insurance rates that covers the insurer's intended und…
Rate adequacy is the condition in which an insurer's filed rates are high enough to cover expected losses, lo…
A rate is the price charged per unit of exposure (for example, per $100 of payroll or per $1,000 of sales), w…
Retrospective rating is a premium plan in which the insured's final premium is adjusted after the policy peri…
Return premium is the amount an insurer refunds to a policyholder when a policy costs less than what was alre…
Underwriting is the process an insurer uses to decide whether to accept a risk, how much coverage to write, a…
Written premium is the total premium on policies an insurer issues (writes) during a period, counted when the…
Rating / Financial · 4 terms
A fronting arrangement is one in which a licensed (admitted) insurer issues a policy to satisfy regulatory, l…
A group captive is a captive insurance company owned by multiple unrelated businesses that pool and share the…
A risk retention group is a member-owned liability insurance company formed under the federal Liability Risk…
Self-insurance is a risk-financing method in which a business retains and directly pays its own losses out of…
Regulatory · 18 terms
AB5 is California's strict employee-classification law using the ABC test. Has been a major driver of Workers…
An assigned risk pool is a state-mandated mechanism that places hard-to-insure risks with participating carri…
A countersignature is the signature of a resident, state-licensed agent on an insurance policy. Many states h…
A Department of Insurance is the state government agency that licenses insurers and agents, reviews rates and…
A diligent search is the documented effort a broker must make to place a risk with admitted carriers before i…
A FAIR Plan is a state-created property insurer of last resort that provides basic coverage to property owner…
A financial responsibility filing is a document an insurer files with a state or federal agency to certify th…
FMCSA is the US Department of Transportation agency that regulates commercial vehicles operating in interstat…
Form filing is the process by which an insurer submits its policy forms, endorsements, and contract wording t…
A guaranty fund is a state-run safety net that pays the outstanding claims of an insolvent insurance company,…
Notice of cancellation and nonrenewal rules are state-mandated requirements that an insurer give the policyho…
Prior approval and file-and-use are two state rate-regulation regimes. Under prior approval, an insurer must…
A rate service organization—also called an advisory or rating organization, such as ISO, NCCI, or AAIS—is a s…
The residual market is the set of state-created insurance mechanisms—such as assigned risk pools, FAIR plans,…
Statutory limits are coverage amounts fixed by law rather than chosen by the buyer—most notably Part One of a…
A surplus lines stamping office is a state-authorized entity that reviews non-admitted (surplus lines) policy…
A surplus lines tax is a state premium tax owed on coverage placed with non-admitted (surplus lines) carriers…
TRIA is a U.S. federal law that provides a government backstop for insured losses from certified acts of terr…
Regulatory / Trucking · 1 term
Reinsurance / Financial · 2 terms
Reserving · 5 terms
A case reserve is the dollar amount an adjuster sets aside for a specific, known, open claim to cover its exp…
IBNR stands for 'incurred but not reported' — a reserve an insurer holds for losses that have already occurre…
Incurred losses are the total cost of claims attributable to a policy period, calculated as losses already pa…
Loss development is the change in the estimated value of claims for a given period as time passes and more in…
Ultimate loss is the projected final total cost of all claims for a policy period once every claim is fully r…
Restaurants · 2 terms
Retail · 2 terms
Risk Management · 1 term
Specialty · 19 terms
Assault and battery coverage insures a business against liability for bodily injury caused by an intentional…
Aviation insurance covers the physical damage and liability exposures of owning and operating aircraft, combi…
A bid bond is a surety bond submitted with a construction or supply bid that guarantees the contractor will h…
Cannabis business insurance is a specialized package of property and liability coverages written for licensed…
Crop insurance protects growers against the loss of crops due to natural perils and, in many forms, declines…
Event cancellation insurance reimburses the non-refundable costs and lost revenue an organizer suffers when a…
Farm and ranch insurance is a blended package policy that combines property, liability, and equipment coverag…
Fiduciary liability insurance protects the individuals and the company who manage an employee benefit plan ag…
Kidnap and ransom (K&R) insurance reimburses a business for costs arising from the abduction, extortion, or w…
A license and permit bond is a surety bond a government agency requires a business to post before issuing a l…
Management liability insurance is a bundled suite of executive coverages — typically directors and officers (…
Ocean marine insurance covers property and liability exposures arising from waterborne transportation, includ…
Product recall insurance covers the costs a business incurs to pull a defective, contaminated, or dangerous p…
Social engineering fraud coverage insures a business against losses when an employee is tricked by deception…
Special event insurance is short-term liability (and optional cancellation) coverage for a specific one-time…
Trade credit insurance protects a business against the risk that its commercial customers fail to pay amounts…
Vacant building insurance is specialty property coverage for commercial structures that are unoccupied or emp…
Valet liability is coverage for a business's legal responsibility for physical damage to customers' vehicles…
Wedding insurance is a special-event policy that combines liability coverage for injury or property damage du…
Specialty Coverage · 1 term
Surety · 4 terms
Contract surety bonds guarantee a contractor's obligations on a construction project (bid, performance, payme…
A court bond (or judicial bond) is a surety bond required by a court to guarantee that a party will fulfill a…
A notary bond is a license-type surety bond many states require of a commissioned notary public. It protects…
A subdivision bond is a surety bond that guarantees a real-estate developer will complete the public improvem…
Surety / Bonds · 4 terms
An appeal bond, or supersedeas bond, is a surety bond a losing party posts to stay (postpone) enforcement of…
An ERISA fidelity bond is a bond required by federal law to protect employee benefit plans against loss from…
A fidelity bond is a two-party insurance-style product that reimburses an employer for losses caused by emplo…
A probate or fiduciary bond is a court-ordered surety bond that guarantees an executor, administrator, guardi…
Surety / Contractors · 2 terms
Surety / Restaurants · 1 term
Trucking · 10 terms
Business auto coverage symbols are the numbers (1 through 9, plus custom symbol 10) on the ISO Business Auto…
Deadhead miles are the miles a truck drives empty — with no cargo or paying load — typically between a delive…
An ELD (Electronic Logging Device) automatically records a commercial driver's driving time and duty status t…
GVWR (Gross Vehicle Weight Rating) is the maximum loaded weight a vehicle is designed to carry, as set by the…
Hotshot trucking is time-sensitive freight hauling with a medium-duty pickup (usually Class 3-5) pulling a fl…
IFTA (International Fuel Tax Agreement) and IRP (International Registration Plan) are reciprocity programs th…
Radius of operation is the distance, measured from a truck's home terminal, within which it normally travels.…
Reefer breakdown coverage is a motor truck cargo endorsement that pays for temperature-sensitive freight that…
Rideshare (TNC) coverage fills the insurance gaps a transportation-network-company driver faces across the ap…
The Unified Carrier Registration (UCR) is a federally mandated annual registration and fee that interstate mo…
Umbrella · 1 term
Underwriting & Rating · 1 term
Workers Comp · 1 term
Workers Compensation · 14 terms
Workers Compensation has two parts: Part A (statutory medical + indemnity to injured employee, uncapped) and…
Experience Modifier is your Workers Comp claims-history multiplier. 1.00 is industry average. Below 1.00 = di…
A ghost policy is a minimum-premium workers' compensation policy issued to a sole proprietor or partner who h…
A Lost-Time WC claim is one where the employee misses work beyond the state's waiting period (typically 3-7 d…
Maximum Medical Improvement (MMI) is the point in a workers' compensation claim when an injured employee's co…
Mod Factor — also called Mod, EMR, or X-Mod — is the Workers Comp claims-history multiplier applied to base p…
Monopolistic State refers to a state where Workers Compensation can ONLY be purchased through the state fund.…
NCCI Class Codes are 3-4 digit classifications maintained by the National Council on Compensation Insurance t…
OSHA compliance is a business's adherence to Occupational Safety and Health Administration standards for work…
Pay-as-you-go workers compensation is a premium-payment method that calculates each installment from actual p…
Schedule Mod is a discretionary premium credit (or surcharge) Workers Comp carriers apply outside the formal…
A State Fund is a state-administered Workers Comp insurer. Some are monopolistic (only WC option); some compe…
TTD = Temporary Total Disability (off work temporarily). TPD = Temporary Partial (modified-duty available). P…
WC Premium Audit is the annual end-of-policy review where the carrier compares actual payroll + class assignm…
Workers' Comp · 6 terms
Excess workers' compensation is coverage that sits above a self-insured employer's retained layer, paying lar…
Foreign voluntary workers' compensation extends U.S.-style workers' comp benefits and employers liability to…
USL&H coverage is federal workers' compensation for maritime employees — such as dockworkers, ship repairers,…
A second injury fund is a state-administered workers' comp fund that reimburses an employer's insurer when a…
Stop-gap coverage is an endorsement that adds employers liability protection (the equivalent of Coverage B) i…
A workers' comp waiver of subrogation is an endorsement in which the WC insurer gives up its right to recover…