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A.m. best company
Insurance industry advisory organization used by regulators, companies, producers and the public to appraise the financial strength of a company
Abandonment (General)
Common policy condition which prohibits insured from deserting a property and claiming a total loss
Accounts receivable
Inland marine coverage form which covers uncollectible monies due to the insured as the result of a covered loss, damage or destruction to accounts receivable records
Actual Cash Value (ACV)
Basic valuation provision found in property policies. Determined by subtracting depreciation from the property\'s replacement value.
Additional Insured (general)
Individual or business not listed as named insured in declarations, but added by endorsement. examples include contractors or distributors.
Additional Insured - Lessor Endorsement (CA 20 01)
Commercial Auto Endorsement used when a vehicle is under a long term lease
Additional Coverages (general)
Coverages included in property policies which beyond the principal policy coverages. Examples include: debris removal; reasonable repairs; Fire Department service charge
Additional Residence Rented to Others (HO 24 70)
Homeowner endorsement which extends the homeowner Section II - Liability coverage to additional residences rented to others
Adhesion (general)
Insurance policy characteristics requiring ambiguous policy language to be interpreted in favor of the insured.
Admitted or Authorized Companies
Insurance companies which are not authorized by the insurance division to conduct business. Must file detailed financial documents and are under the jurisdiction of the insurance division.
Adverse Selection
Process of being selected against. A risk which has a greater bias to an exposure than the average risk. It is the tendency of the poorer risks to seek insurance.
Advertising Injury
Injury arising out of oral or written publication that slanders or libels a person or organization, invade your privacy or infringes upon ideas, style, copyright, title or slogan. Coverage is is provided under CGL policy in the Businessowners Policy.
Affirmative Warranty
Type of warranty requiring certain facts to be affirmed or true at policy inception.
Agency Billed Policies
Premium collection method where the agency bills the insured for gross premium, subtract commissions and remits the net amount to the insurer. :Used in some commercial policy transactions.
Agency
Legal Relationship which exists when one party acts on behalf of another party (i.e., agent acting for company; employee acting for agency).
Agent/Producer
Individual, partnership or corporation authorized by a company to solicit risks, collect premiums or countersign policies.  Agents/producers represent companies.
Aggregate Limits (general)
Maximum overall limit of liability for a policy period.
Agreement (Offer and Acceptance)
Element of a contract which refers to the offer by one party and the acceptance by a second party.
Agreed Value Approach
Property valuation method whereby insurer and insured agree to coverage amount.  In these cases the coinsuance requirement is waived.
Aleatory Contracts
Insurance policy characteristic of unequal bargaining value (preimum payment v. loss settlement) and based upon a future unknown event.
Alien Company
Company domiciled outside the United States. (i.e., Nippon Life in Japan; Allianz in Germany).
Apparent Authority
Type of authory the public perceives a producer to have based upon his actions.
Appraisal Condition (general)
Common property insurance policy provision that provides that in the event the insured and insurer cannot agree to the value of teh damged property, either party may make a demand for appraisal.
Arbitration Condition (general)
Common liability insurance policy provision that provides that in the event the insured and insurer cannot agree on the amount of loss, either party may make a demand for arbitration.
Assigned Risk Plan (auto)
Residual market for individuals who are unable to secure insurance through the voluntary auto market.  Also known as Automobile Insurance Plan.
Association Captive
Alternative financing mechanism.  Type of captive which insures risks of its members and their affiliated companies.
Assuming Company
Reinsurance company that assumes the exposure from the ceding company.
Assumption of Risk
Common law defense which bars or reduces recovery to an injured person if that person knew of the consequences and assumed the risk.
Auto
Land motor vehicle or trailer designed for travel on public roads and includes equipment attached to the vehicle.  Requires motor vehicle registration.
Automatic Increase
Endorsement which provides increases in coverage amounts to reflect increases in inflation.
Bailee
An individual or business that accepts property from another (dry cleaner, laundry, furniture refinisher).
Bailees Customers Form
An Inland Marine Form used to cover a bailee for property in his possession.
Bailor
An individual or business that transfers their property for service.
Bill of Lading
A contract between the common carrier and the shipper setting forth terms of responsibility.
Binders
Temporary insurance contract made orally or in writing, for a period of not more than 30 days.
Blanket Insurance
Single amount of insurance that is provided to all locations.
Boatowners Form
Coverage Form which provides property damage to the boat, outboard motors, trailer and miscellaneous boating equipment and boatowners liability caused by the insured's negligence.
Bodily Injury (general)
Bodily harm, sickness, disease, including death.
Bodily Injury Liability (auto)
Pays others when the insured is responsible for causing injuries and includes medical and rehabilitation expeses and noneconimic damages such as pain and suffering.
BOP
Abbreviation for Businessowners Policy
Broad Form Nuclear Energy Exclusion Endorsement
Commercial General Liability Endorsement which specifically exclusdes coverage for bodily injury or property damage caused by nuclear materials at a nuclear facility.
Broad Form Products Endorsement (CA 25 01)
Garage Policy Endorsement which covers property damage to the insured's (garage owner) defective product.
Broker
An individual, partnership or corporation, not an officer or agent of an insurer, who for compenstation, acts or aids in any manner in obtaining insurance for a person other than himself.  A broker represents the insured.
Building Limit - Automatic Increase
BOP Endorsement which increases coverage for buildings on a pro rata basis.
Builders Risk Form
Commercial Property Coverage Form which provides coverage to buildings under construction.
Building and Personal Property Form
Commercial Form used to insure various types of commercial property.
Building Ordinance or Law Coverage (HO 04 77)
Homeowner Endorsement that provides additional coverage if at the time of loss stricter building ordinances require construction different than originally designed.
Business Income Form
Commercial Property Coverage Form which provides income due to the interruption or suspension in business.  Business interruption must be caused by a covered direct loss.
Business Personal Property Limit - Seasonal Increase
BOP coverage which automatically increases business personal property to an addition 25% to reflect seasonal increases.
Business Pursuits (HO 24 71)
Homeowners Endorsement which covers occupational liability of those who are employed by others (i.e., teachers).
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