E Flashcards
Early warning system
a system designed by insurance industry regulators of identifying practices and risk-related trends that contribute to systemic risk by measuring an insurer’s financial stability.
Earned Premium
portion of insured’s prepaid premium allocated to the insurance company’s loss experience, expenses, and profit year-to-date.
Earthquake
property coverages for losses resulting from a sudden trembling or shaking of the earth, including that caused by volcanic eruption. Excluded are losses resulting from fire, explosion, flood or tidal wave following the covered event.
Earned But Not Reported (EBNR)
premium amount insurer reasonably expects to receive for which contracts are not yet final and exact amounts are not definite.
EDP Policies
coverage to protect against losses arising out of damage to or destruction of electronic data processing equipment and its software.
Effective Date
date at which an insurance policy goes into force.
Encumbrance
outstanding mortgages or other debt related to real estate and any unpaid accrued acquisition or construction costs.
Endorsement
an amendment or rider to a policy adjusting the coverages and taking precedence over the general contract.
Event Cancellation
coverage for financial loss because of the cancellation or postponement of a specific event due to weather or other unexpected cause beyond the control of the insured.
Excess and Umbrella Liability
liability coverage of an insured above a specific amount set forth in a basic policy issued by the primary insurer; or a self insurer for losses over a stated amount; or an insured or self insurer for known or unknown gaps in basic coverages or self insured retentions.
Excess of Loss Reinsurance
loss sharing mechanism where an insurer pays all claims up to a specified amount and a reinsurance company pays any claims in excess of stated amount.
Expense Ratio
percentage of premium income used to attain and service policies. Derived by subtracting related expenses from incurred losses and dividing by written premiums.
Experience Rating
rating system where each group is rated entirely on the basis of its own expected claims in the coming period, with retrospective adjustments for prior periods. This method is prohibited under the conditions for federal qualification.
Exposure
risk of possible loss.
Extra Expense Insurance
a type of property insurance for extraordinary expenses related to business interruption such as a back-up generator in case of power failure.
