Insurance Terminology

3. This is liability account used to amortize premium earnings over the term of the policies in force.
5. This is an asset account used to defer the costs associated with assuming an insurance contract from another insurer.
6. In reinsurance, a commitment made by a bank to a reinsured which can be drawn upon to cover any of the reinsurer's liabilities to the reinsured under their reinsurance agreement.
8. Those principles required by the NAIC and by state law which must be followed by insurance companies in submitting their financial statements to the NAIC and state insurance departments, unless express permission is given otherwise.
11. Any person, firm, association or corporation who manages all or part of the insurance business of an insurer.
12. In the process of defending and settling a particular claim many expenses are often incurred besides the cost to actually reimburse the injured party (such as claims investigation and legal and other fees expenses, and the portion of an insurer’s general expense allocated to claim settlement costs).
14. Reserves set aside for future use in payment of claims which have occurred but have not yet been reported to the insurer.
15. Similar to ALAE (defined elsewhere) except that this represent expenses incurred by the insurer that are not identifiable to a specific claim but are nonetheless loss adjustment expenses.

1. A method of reporting the financial results of an insurer in accordance with the going-concern basis used by other businesses.
2. An association of captive owners and industry representatives who represent the Vermont captive industry to regulatory agencies, etc.
4. An amount computed for an insurer based on a standard NAIC formula against which the insurer's policyholders' surplus is measured to assess its adequacy.
7. A type of loss reserve or payable established to use in payment of claims that are known about and reasonably estimable.
8. This acronym is used most commonly in reference to the Vermont Department of Financial Regulation.
9. The resulting amount from a company's evaluation of its exposure to loss under hypothetical, but possible loss scenarios.
10. An association of the state regulatory authorities.
13. Compensation to indicate that the coverage pays for losses that are “excess” of some limit.