Hail Insurance
Form of insurance that protects against loss of crops from hail

Hazard
A condition that creates or increases the probability of a loss

Health insurance
A generic term applying to all types of insurance indemnifying or reimbursing for losses caused by bodily accident or sickness or for expenses of medical treatment necessitated by sickness or accidental bodily injury.

House Breaking
When the theft is committed entering into or out of the premises stealthily

Housekeeping
The general care, cleanliness and maintenance of an insured property

Householders Policy
A package of insurance providing homeowners with a broad range of property and liability coverages

Hull insurance (in ocean marine and aviation insurance)
Coverage for physical damage to a vessel or aircraft

Hurricane
A tropical storm marked by extremely low barometric pressure and circular winds with a velocity of 120 miles an hour or more.

IBNR (Incurred but not Reported) provision
Provision for claims incurred but not reported by the balance-sheet date. That is, it is anticipated that there would be a number of policies that have, but for the advice of the claim to the insurer, occurred and therefore are likely to result in a liability on the insurer.
The magnitude of this provision can be expected to reduce as the time since the insurance risk on the contract expired extends. The magnitude is also likely to vary depending on the type of insurance risk covered by any particular class of insurance contract.

Illegal Contract
It is a contract, which is contrary to law and against the interests of public. It can not be sustained and does not have legal effect.

Imputed Negligence
Case in which responsibility for damage can be transferred from the negligent party to another person, such as an employer

Incurred Claims
Incurred claims equal the claims paid during the policy year plus the claim reserves as of the end of the policy year, minus the corresponding reserves as of the beginning of the policy year. The difference between the year end and beginning of the year claim reserves is called the increase in reserves and may be added directly to the paid claims to produce the incurred claims.

Incurred Loss Ratio
The percentage of losses incurred to premiums earned.

Indemnification
Compensation to the victim of a loss, in whole or in part, by payment, repair, or replacement

Indemnify
Legal principle that specifies an insured should not collect more than the actual cash value of a loss but should be restored to approximately the same financial position as existed before the loss.

Indemnity Period
The period, beginning with the date of the damage, during which the turnover of the business is affected by the damage. It lasts until the turnover recovers and reaches the point at which it would have been had the loss not occurred, or the expiry of the maximum indemnity period -the number of months selected by the insured -whichever occurs first.

Indemnity principle
Of a general legal principle related to insurance which holds that the individual recovering under an insurance policy should be restored to the approximate financial position he or she was in prior to the loss.

Independent adjuster
One who adjusts losses on behalf of companies but is not employed by any one. He or she is paid by fee for each loss adjusted.

Indirect Loss (Or Damage)
Loss resulting from a peril, but not caused directly and immediately thereby. For example: Loss of property due to fire is a direct loss, while the loss of rental income as the result of the fire would be an indirect loss.

Inherent vice
A characteristic depreciation such as the fading of ink, a cracking of parchment, the graying of hair

Insurable interest
An interest which might be damaged if the peril insured against occurs: the possibility of a financial loss to an individual which can be protected against through insurance.

Insurance
An economic device whereby the individual substitutes a small certain cost (the premium) for a large uncertain financial loss (the contingency insured against) which would exist if it were not for the insurance contract: an economic device for reducing and eliminating risk through the process of combining a sufficient number of homogeneous exposures into a group in order to make the losses predictable for the group as a whole.

Insurance Company
1. An organization chartered to operate as an insurer. (2) Any corporation primarily engaged in the business of furnishing insurance protection to the public

Insurance Entities
Any corporate body or individual which is operating as an insurer, reinsurer or insurance intermediary and which is subject to insurance regulation

Insurance Product
An insurance product is defined as a product that is provided by an insurance company.

Insurance Policy
Legal document issued to the insured setting out the terms of the contract of insurance.

Insured
The person to whom or on whose behalf benefits are payable under the policy

Insurer
A licensed legal entity, which underwrites insurance, including a mutual insurance company (but note the exemption of pure reinsurers)

Intermediary
Any person who, or organization which, gives advice by way of directly offering, advertising or on a person-to-person basis in respect of an insurance product and includes the promotion of such a product or the facilitation of an agreement or contract between an insurer and a customer. Intermediaries are generally divided into separate classes. The most common types are 'independent intermediaries' who represent the buyer in dealings with the insurer (also known as independent brokers) and 'agents' (which generally include multiple agents and sub-agents) who represent the insurer.

Irrevocable beneficiary
Beneficiary designation allowing no change to be made in the beneficiary of an insurance policy without the consent of the named beneficiary

Jettison
Act of throwing overboard part of a vessel's cargo or hull in hopes of saving a ship from sinking.

Jewelers Block Insurance
An all risk insurance contract that provides jewelers with coverage to losses, which they would be exposed.

Joint-and-Several Liability
A legal principle that permits the injured party in a tort action to recover the entire amount of compensation due for injuries from any tort feasor who is able to pay, regardless of the degree of that party's negligence

Key-Person Insurance
Insurance designed to protect a business firm against the loss of income resulting from the death or disability of a key employee.

Lapse
Termination of a policy due to failure by the insured to pay the premium as required

Larceny
The unlawful taking, carrying, leading or riding away of another person's property

Law of large numbers
While it is impossible to predict either the time or the loss amount of adverse events in relation to individuals, the averages for a sufficiently large set (of insureds) exhibit certain patterns of loss frequency and loss extent

Legal Costs
The costs of defending a claim from a third party and claimant's costs for which an insured is liable, are usually covered by a liability policy.

Legal liability
Any liability imposed on a person by a court of law

Lessee
The person to whom a lease is granted, commonly called the tenant.

Lessor
The person granting a lease, also known as the landlord

Letter of Credit (LOC)
Within the context of reinsurance, a banking instrument established on a 'standby' basis to secure recoverables from non-admitted reinsurers to enable the ceding company to reduce the provision for unauthorized reinsurance in its statutory statement

Liability
Any legally enforceable obligation

Liability Insurance
Insurance covering the policyholder's legal liability resulting from injuries to other persons or damage to their property. Liability Insurance. Provides protection for the insured against loss arising out of legal liability to third parties

Licensing
The incorporation of a company in the jurisdiction or the approval given to a company to underwrite insurance in the jurisdiction. These are recognized to be separate approvals and may be made in separate jurisdictions

Line
One line is equal to the ceding company 's retention. A proportional treaty may have a total capacity expressed as x lines and a reinsurer's share may be y lines

Line of Business
The general classification of business as utilized in the insurance industry, i.e., fire, allied lines, homeowners, etc.

Lloyds
A voluntary unincorporated association of individuals organized for the purpose of writing insurance; normally refers to Lloyd's of London, a group of individual underwriters and syndicates that underwrite insurance risks severally, using facilities maintained by the Lloyd's of London Corporation

Load
To add charges to an insurance premium

Loss Adjuster
An independent professional appointed by the insurers to settle claims

Loss of Profits
A synonym for business interruption insurance

Loss Ratio
The proportionate relationship of incurred losses to earned premiums expressed as a percentage.

Manual
A book of rates, rules, and coverages usually available for each kind of insurance

Margin of Solvency
The total assets of an insurance company must exceed its liabilities (other than share capital) by a relevant amount, known as the margin of solvency

Marine
Pertaining to the sea or to transportation: usually divided as to 'ocean marine' and 'inland marine'; the insurance covering transportation risks

Marine Insurance
A form of insurance primarily concerned with means of transportation and communication, and with goods in transit

Market Value
The price for which something would sell, especially the value of certain types of assets, such as stocks and bonds. It is based on what they would sell for under current market conditions. For example, common stock market value would be the price of the stock as of a specified date

Material Damage Policy
The policy covering damage to property (usually a commercial fire policy) as the result of which damage a business interruption claim may result. It is a condition of business interruption insurance that a material damage policy must be and remain in force

Material Fact
Information about the subject of insurance that if known would change the underwriting basis of the insurance, and which would cause the insurer to refuse the application or charge a higher rate

Misrepresentation
Act of making, issuing, circulating or causing to be issued or circulated an estimate, an illustration, a circular or a statement of any kind that does not represent the correct policy terms, dividends or share of surplus or the name or title for any policy or class of policies that does not in fact reflect its true nature.

Moral Hazard
Moral Hazard refers to increase in probability of loss that results from dishonesty in the character of the insured person. Thus it is the dishonest tendencies on the part of the insured person that may induce that person to attempt to defraud the insurance company

Morale Hazard
An attitude that increases the probability of loss from a peril. The attitude of, "It's insured; so why worry?" is an example of a morale hazard

Mortgage
A deposit or conditional transfer to secure the performance of some act: the person who makes the transfer is called the 'mortgagor', the other party, the 'mortgagee'; sometimes an intermediary called a 'trustee' is appointed

Mortgagor
A borrower who takes out a mortgage MPL (Maximum Probable Loss)
The largest loss thought probable under a given insurance policy. Normally applied to material damage risks where the total sum insured is not considered to be at risk from one loss event

Multi-Peril Policy
A package policy which provides protection against a number of separate perils. Multi-peril policies are not necessarily multiple line policies, since the combined perils may be all within one insurance line