Act of God: Natural occurrences beyond human control or influence. Eg. Hurricanes.

Agent: Individuals who sells and services insurance policies either as an independent agent or as a direct writer.

Independent Agent: Represents at least two companies and services clients by searching the market for the most advantageous price for the most coverage.

Direct Writer: Represents only one company and sells only its policies.

Applicant: Prospective insured who completes and signs a written form containing personal statements about him/her.

Application: Written statements on a form by a prospective insured about him, including assets and other personal information.

Appraisal: Valuation of property for damage resulting from an insured peril or for establishing the base amount of insurance coverage to be purchased.

Arson: Actual or attempted malicious and deliberate burning of a physical asset owned by another party.

Beneficiary: Designation by the owner of a life insurance policy indicating to whom the proceeds are to be paid upon the insured's death or when an endowment matures.

Bodily injury: Physical damage to one's person.

Broker-Agent: Independent insurance sales person who represents particular insurers but may also function as a broker by searching the entire insurance market to place an applicant's coverage to maximize protection and minimize costs.

Burglary: Forced entry into premises.

Burglary Insurance: Coverage against loss as the result of a burglary.

Business Interruption Insurance: Indemnification for the loss of profits and the continuing fixed expenses.

Business Risk: Investment risk associated with the changes in the earnings capability of the company.

Cancel: Termination of a policy.

Cargo Marine Insurance: Shipper's policies covering one cargo exposure or all cargo exposures by sea on all risks basis.

Catastrophe loss: High severity loss that does not lend it self to accurate predictions and thus should be transferred by the individual or business to an insurance company.

Claims: Request by an insured for indemnification by an insurance company for loss incurred from an insured peril.

Claimant: One who submits a claim for an incurred loss.

Claims report: Report furnished by the adjuster to the insurance company that documents the amount payment the insurer is legally obligated to pay to or on behalf of the insured under the terms of the policy.

Clause: In an insurance policy , sentences and paragraphs describing various coverages, exclusions, duties of the insured, location covered and conditions
that suspend or terminate coverage.

Client: Person who engages an agent or broker for advice and possible purchase of insurance.

Comprehensive Insurance: Coverage in automobile insurance providing protection in the event of physical damage or theft of the insured car.

Comprehensive policy: Combination of several coverages to protect the insured.

Conditions: Actions the insured must take, or continue to take for the insurance policy to remain in force and the insurance company to process a claim.

Consequential loss: Value of loss resulting from loss of use of property.

Contents: Coverage for personal property and or business personal property items that are movable that is not attached to the building's structure.

Contract: In insurance, agreement between an insurer and an insured under which the insurer has a legally enforceable obligation to make all benefit payments
for which it has received premiums.

Contract holder: In insurance, individual with rightful possession of an insurance policy, usually the policy owner.

Coverage: Is protection under an insurance policy.

Damages: Sum the insurance company is legally obligated to pay an insured for the loss incurred.

Deductible: Amount of loss that insured pays in a claim.

Depreciation: Actual or accounting recognition of the decrease in the value of hard asset over a period of time, according to a predetermined schedule.

Effective Date: Date at which an insurance policy goes into force.

Endorsement: Written agreement attached to a policy to add or subtract insurance coverages.

Fraud: Dishonest act.

Goodwill: Monetary value of the reputation of the business.

Group Life Insurance: Basic employee benefit under which an employer buys a master policy and issues certificates to employees denoting participation in the plan.

Hazard: Circumstances that increases the likelihood or probable severity of a loss.

Indemnity: Compensation for loss.

Inspection report: statement prepared by an inspection bureau for a life or health insurance company that summarizes information about an applicant for a policy.

Insurable interest: Expectation of a monetary loss that can be covered by insurance.

Insurable risk: Conditions in which an applicant has met an insurance company's standards.

Insurance: Mechanism for contractually shifting burdens of a number of pure risks by pooling them.

Insurance policy: Written contract between an insured and an insurance company stating the obligation and responsibilities of each party.

Insurance risk: Coverage for exposure that exhibits a possibility of financial loss.

Insured: refers to the party covered by an insurance policy.

Insured perils: Source of loss that is covered under an insurance policy, such as fire and explosions etc.

Insurer: Company offering protection through the sale of an insurance policy to an insured.

Lapse: Termination of a policy because of failure to pay a renewal premium. Liability: Legal obligation to perform or not perform specified acts(s).

Liability policy: Coverage for all sums that the insured becomes legally obligated to pay because of bodily injury or property damage.

Loss: Damage through an insured's negligent acts and/or omissions resulting in bodily injury and/or property damage to a third party, damage to an insured's property or amount an insurance company has a legal obligation to pay.

Loss payable clause: Coverage for a mortgagee where real or personal property used as security for a loan is damaged or destroyed.

Medical Examination: Physical checkup required of applicants for life and/or health insurance to ascertain if they meet a company's underwriting standards or should be classified as substandard or uninsurable.

Mortgagee clause: Attachment to a property insurance policy to protect the interest of the mortgagee in the mortgaged property.

Named Insured: Person, business or organization specified as the insured(s) in a property or a liability insurance policy.

Negligence: Failure to act with the legally required degree of care for others, resulting in harm to them.

Occurrence: Event that results in bodily injury and/or property damage to a third party.

Off Premises: Location that is different from an insured's home or place of business.

Outboard motor boat insurance: Coverage on all risks basis for physical damage loss.

Outstanding premium: Payments due to an insurance company but not yet paid.

Policy: Written agreement that puts insurance coverage into effect.

Policy Fee: Flat amount added to the basic premium rate to arrive at the premium.

Policy holder: Individual or other entity who owns an insurance policy.

Policy period: Time interval during which policy is in force.

Policy structure: General arrangement of a contract between an insurer and an insured.

Premium: Rate that an insured is charged, reflecting his or her expectation of loss or risk.

Premium Discount: Reduction in rate reflecting the present value of a premium due on annuity on year hence.

Proof of loss: documentation of loss required of a policy owner by an insurance company.

Pro rata cancellation: Revocation of a policy by an insurance company that returns to the policy holder the unearned premium (the portion of the premium for the remaining period that the policy will be in force).

Protection and Indemnity insurance (P&I): Broad type of marine legal liability coverage.

Rates: Cost per unit of insurance.

Rating: A valuation of risk of an individual or organization.

Real estate: Land and attached structures.

Reinstatement: Restoration of a policy that has lapsed because of nonpayment of premiums after the grace period has expired.

Reinsurance: Form of insurance that insurance companies buy for their own protection, "sharing of insurance".

Renewal: Automatic reestablishment of an insurance policy's in-force status, usually achieved through payment of the premium due.

Renewal certificate: Form showing notification that an insurance policy has been renewed with the same provisions, clauses and benefits of the previous policy.

Renewal Premium: Payment due on the renewal of an insurance policy.

Risk: Uncertainty of financial loss; Term used to designate an insured or a peril insured against.

Settlement: Disposition of a claim or policy benefits.

Short Period Insurance: Coverage for less than one year. Short rate Cancellation: Cancellation by the insured of a property or disability insurance policy for which the returned unearned premium is diminished by administration costs incurred when the insurance company placed the policy on its books.

Short rate premium: Premium charge for a policy that is going to be in force for less than the normal period of time. Subrogation Clause: Section of property insurance and liability insurance policies giving an insurer the right to take legal action against a third party responsible for a loss to an insured for which a claim has been paid.

Term: Period of time of insurance coverage.

Third Party: Individual other than the insured or insurer who has incurred a loss or is entitled to receive a benefit payment as the result of the facts or omissions of the insured.

Third party Insurance: Liability insurance purchased by the insured (first party) from an insurance company (second party) for protection against possible suits brought by another (third party).

Total Loss: Condition of real or personal property when it is damaged or destroyed to such an extent that it cannot be rebuilt or repaired to equal its condition prior to the loss.

Underwriting: Process of examining, accepting, or rejecting insurance risks and classifying those selected in order, in order to charge the proper premium for each.