Insurance & Risk
Management
BBA (B & F)
Insurance
Contract whereby one party undertakes to indemnify or guarantee
another against loss by a specified contingency or peril
Insured & Insurer
Insured - party(ies) covered by an insurance policy.
Insurer - an insurer or reinsurer authorized to write property and/or
casualty insurance under the laws of any state.
Risk
A situation involving exposure to danger
Premium
An amount to be paid for a contract of insurance.
Sum Assured
The sum assured is the amount of money an insurance policy
guarantees to pay up before any bonuses are added. In other
words, sum assured is the guaranteed amount the policyholder will
receive. This is also known as the cover or the coverage amount and is
the total amount for which an individual is insured.
Insurable Interest
An insurable interest is a stake in the value of an entity or event for
which an insurance policy is purchased to mitigate risk of loss.
Term Insurance
Term Insurance - life insurance payable only if death of insured
occurs within a specified time, such as 5 or 10 years, or before a
specified age
Endowment Insurance
An endowment policy is a life insurance contract designed to pay a
lump sum after a specific term (on its 'maturity') or on death. Typical
maturities are ten, fifteen or twenty years up to a certain age limit.
Some policies also pay out in the case of critical illness.
Mortality Table
Mortality Table - chart that shows the death rates of a particular
population at each age displayed as the number of deaths per
thousand.
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An amount that is built in to the insurance cost. This amount covers the
operating cost of the insurer, as well as the chance that the insurer's
losses for that period will be higher than anticipated
No Claim Bonus
A reduction in the premium charged for insurance when no claim has
been made during an agreed preceding period.
Loss Reduction
One of the major risk management techniques. Taking precautionary
measures to reduce the likelihood of a loss, or to reduce the severity of
a possible loss, for example, installing a security system.
Loss Prevention
Loss prevention is the act of taking proactive measures to prevent or
abate identified risks which, if left unmitigated, may result in
university claim expenditures.
Blanket Insurance
Blanket insurance provides more than one type of coverage using a
single policy with a single limit. It can provide multiple types
of coverage on one property, or group several properties together
under one blanket policy.
Reinsurance
Reinsurance is insurance that is purchased by an insurance company
(the "ceding company" or "cedent" or "cedant" under the
arrangement) from one or more insurance companies (the "reinsurer")
directly or through a broker
Agent
Agent - an individual who sells, services, or negotiates insurance
policies either on behalf of a company or independently.
Broker
Broker - an individual who receives commissions from the sale and
service of insurance policies. These individuals work on behalf of the
customer and are not restricted to selling policies for a specific
company but commissions are paid by the company with which the
sale was made.
Captive Insurance
Captive Insurer - an insurance company established by a parent firm
for the purpose of insuring the parent's exposures.
Co-Insurance
Coinsurance - A clause contained in most property insurance policies
to encourage policy holders to carry a reasonable amount of
insurance. If the insured fails to maintain the amount specified in the
clause (Usually at least 80%), the insured shares a higher proportion of
the loss. In medical insurance a percentage of each claim that the
insured will bear.
Deductible
Deductible - Portion of the insured loss (in dollars) paid by the policy
holder