ADDITIONAL LIVING EXPENSES - Extra charges covered
by homeowners policies over and above the policyholder's customary
living expenses. They kick in when the insured requires temporary
shelter due to damage by a covered peril that makes the home
temporarily uninhabitable.
ADJUSTER- An individual employed by a property/casualty
insurer to evaluate losses and settle policyholder claims.
These adjusters differ from public adjusters, who negotiate
with insurers on behalf of policyholders, and receive a portion
of a claims settlement. Independent adjusters are independent
contractors who adjust claims for different insurance companies.
AGENCY COMPANIES- Companies that market and sell products
via independent agents.
ALTERNATIVE DISPUTE RESOLUTION / ADR- Alternative
to going to court to settle disputes. Methods include arbitration,
where disputing parties agree to be bound to the decision
of an independent third party, and mediation, where a third
party tries to arrange a settlement between the two sides.
ANNUAL STATEMENT -Summary of an insurer's or reinsurer's
financial operations for a particular year, including a balance
sheet. It is filed with the state insurance department of
each jurisdiction in which the company is licensed to conduct
business.
ANTITRUST LAWS- Laws that prohibit companies from
working as a group to set prices, restrict supplies or stop
competition in the marketplace. The insurance industry is
subject to state antitrust laws but has a limited exemption
from federal antitrust laws. This exemption, set out in the
McCarran-Ferguson Act, permits insurers to jointly develop
common insurance forms and share loss data to help them price
policies.
APPRAISAL- A survey to determine a property's insurable
value, or the amount of a loss.
ARBITRATION- Procedure in which an insurance company
and the insured or a vendor agree to settle a claim dispute
by accepting a binding or non-binding decision made by a third
party.
ARSON -The deliberate setting of a fire.
ASSETS - The property owned, in this case by an insurance
company, including stocks, bonds, and real estate investments.
State laws require a conservative valuation of assets so they
do not allow insurance companies to list some assets whose
values are uncertain, such as furniture, fixtures, debit balances,
and accounts receivable that are more than 90 days past due.
ASSIGNED RISK PLANS - Facilities through which drivers
can obtain auto insurance if they are unable to buy it in
the regular or voluntary market. These are the most well-known
type of residual auto insurance market, which exist in every
state. In an assigned risk plan, all insurers selling auto
insurance in the state are assigned these drivers to insure,
based on the amount of insurance they sell in the regular
market
AUTO POLICY - There are basically six different types
of coverages. Some may be required by law. Others are optional.
They are:
- Bodily injury liability, for injuries the policyholder
causes to someone else.
- Medical payments or Personal Injury
Protection (PIP) for treatment of injuries to the driver and
passengers of the policyholder's car.
- Property damage liability,
for damage the policyholder causes to someone else's property.
- Collision, for damage to the policyholder's car from a
collision.
- Comprehensive, for damage to the policyholder's
car not involving a collision with another car (including
damage from fire, explosions, earthquakes, floods, and riots),
and theft.
- Uninsured motorists coverage, for costs resulting
from an accident involving a hit-and-run driver or a driver
who does not have insurance.
