Insurance

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Insurance is a means of protection from financial loss.wikipedia
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Insurance policy

insurance policiespolicypolicies
The insured receives a contract, called the insurance policy, which details the conditions and circumstances under which the insurer will compensate the insured.
In insurance, the insurance policy is a contract (generally a standard form contract) between the insurer and the insured, known as the policyholder, which determines the claims which the insurer is legally required to pay.

Reinsurance

re-insurancereinsurerreinsurers
The insurer may hedge its own risk by taking out reinsurance, whereby another insurance company agrees to carry some of the risk, especially if the primary insurer deems the risk too large for it to carry. 7) Limited risk of catastrophically large losses: Insurable losses are ideally independent and non-catastrophic, meaning that the losses do not happen all at once and individual losses are not severe enough to bankrupt the insurer; insurers may prefer to limit their exposure to a loss from a single event to some small portion of their capital base. Capital constrains insurers' ability to sell earthquake insurance as well as wind insurance in hurricane zones. In the United States, flood risk is insured by the federal government. In commercial fire insurance, it is possible to find single properties whose total exposed value is well in excess of any individual insurer's capital constraint. Such properties are generally shared among several insurers, or are insured by a single insurer who syndicates the risk into the reinsurance market.
Reinsurance is insurance that is purchased by an insurance company.

Claims adjuster

insurance adjusteradjusterloss adjuster
The amount of money charged by the insurer from the insured for the coverage set forth in the insurance policy is called the premium. If the insured experiences a loss which is potentially covered by the insurance policy, the insured submits a claim to the insurer for processing by a claims adjuster.
Claims adjuster (claim adjuster), or claims handler (claim handler), investigates insurance claims by interviewing the claimant and witnesses, consulting police and hospital records, and inspecting property damage to determine the extent of the company's liability.

Property insurance

propertyfire insurancefire
Property insurance as we know it today can be traced to the Great Fire of London, which in 1666 devoured more than 13,000 houses. In the United States, the underwriting loss of property and casualty insurance companies was $142.3 billion in the five years ending 2003.
This includes specialized forms of insurance such as fire insurance, flood insurance, earthquake insurance, home insurance, or boiler insurance.

Lloyd's of London

LloydLloydsLloyd’s
These informal beginnings led to the establishment of the insurance market Lloyd's of London and several related shipping and insurance businesses.
Lloyd's of London, generally known simply as Lloyd's, is an insurance and reinsurance market located in London, United Kingdom.

Life insurance

lifelife assurancelife insurance policy
The first life insurance policies were taken out in the early 18th century.
Life insurance (or life assurance, especially in the Commonwealth of Nations) is a contract between an insurance policy holder and an insurer or assurer, where the insurer promises to pay a designated beneficiary a sum of money (the benefit) in exchange for a premium, upon the death of an insured person (often the policy holder).

Underwriting

underwriterunderwritersunderwrite
An entity which provides insurance is known as an insurer, insurance company, insurance carrier or underwriter.
The name derives from the Lloyd's of London insurance market.

Lloyd's Coffee House

Edward Lloyda coffee housea coffeehouse
In the late 1680s, Edward Lloyd opened a coffee house, which became the meeting place for parties in the shipping industry wishing to insure cargoes and ships, and those willing to underwrite such ventures.
The shipping industry community frequented the place to discuss maritime insurance, shipbroking and foreign trade.

Insurability

uninsurableinsurable risk
In order to be an insurable risk, the risk insured against must meet certain characteristics.
Insurability can mean either whether a particular type of loss (risk) can be insured in theory, or whether a particular client is insurable for by a particular company because of particular circumstance and the quality assigned by an insurance provider pertaining to the risk that a given client would have.

Self-insurance

self-insuredself insuranceself insure
Insurance as a financial intermediary is a commercial enterprise and a major part of the financial services industry, but individual entities can also self-insure through saving money for possible future losses.
Self-insurance describes a situation in which a person does not take out any third party insurance.

Indemnity

indemnificationindemnifyindemnities
1) Indemnity – the insurance company indemnifies, or compensates, the insured in the case of certain losses only up to the insured's interest.
Indemnities form the basis of many insurance contracts; for example, a car owner may purchase different kinds of insurance as an indemnity for various kinds of loss arising from operation of the car, such as damage to the car itself, or medical expenses following an accident.

Earthquake insurance

Earthquake Insurance SystemEarthquake Losslosses
7) Limited risk of catastrophically large losses: Insurable losses are ideally independent and non-catastrophic, meaning that the losses do not happen all at once and individual losses are not severe enough to bankrupt the insurer; insurers may prefer to limit their exposure to a loss from a single event to some small portion of their capital base. Capital constrains insurers' ability to sell earthquake insurance as well as wind insurance in hurricane zones. In the United States, flood risk is insured by the federal government. In commercial fire insurance, it is possible to find single properties whose total exposed value is well in excess of any individual insurer's capital constraint. Such properties are generally shared among several insurers, or are insured by a single insurer who syndicates the risk into the reinsurance market.
Earthquake insurance is a form of property insurance that pays the policyholder in the event of an earthquake that causes damage to the property.

Flood insurance

floodflood risk
7) Limited risk of catastrophically large losses: Insurable losses are ideally independent and non-catastrophic, meaning that the losses do not happen all at once and individual losses are not severe enough to bankrupt the insurer; insurers may prefer to limit their exposure to a loss from a single event to some small portion of their capital base. Capital constrains insurers' ability to sell earthquake insurance as well as wind insurance in hurricane zones. In the United States, flood risk is insured by the federal government. In commercial fire insurance, it is possible to find single properties whose total exposed value is well in excess of any individual insurer's capital constraint. Such properties are generally shared among several insurers, or are insured by a single insurer who syndicates the risk into the reinsurance market.
Flood insurance denotes the specific insurance coverage against property loss from flooding.

Insurance fraud

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Insurance can influence the probability of losses through moral hazard, insurance fraud, and preventive steps by the insurance company.
False insurance claims are insurance claims filed with the intent to defraud an insurance provider.

Actuarial science

actuarialactuarial mathematicsactuarially
The most complicated aspect of the insurance business is the actuarial science of ratemaking (price-setting) of policies, which uses statistics and probability to approximate the rate of future claims based on a given risk.
Actuarial science is the discipline that applies mathematical and statistical methods to assess risk in insurance, finance and other industries and professions.

Overhead (business)

overheadoverheadsoverhead costs
Insurance premiums from many insureds are used to fund accounts reserved for later payment of claims – in theory for a relatively few claimants – and for overhead costs.
Overhead expenses include accounting fees, advertising, insurance, interest, legal fees, labor burden, rent, repairs, supplies, taxes, telephone bills, travel expenditures, and utilities.

Economics

economiceconomisteconomic theory
A number of attempted fire insurance schemes came to nothing, but in 1681, economist Nicholas Barbon and eleven associates established the first fire insurance company, the "Insurance Office for Houses," at the back of the Royal Exchange to insure brick and frame homes.
Risk aversion may stimulate activity that in well-functioning markets smooths out risk and communicates information about risk, as in markets for insurance, commodity futures contracts, and financial instruments.

Gambling

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3) Insurable interest – the insured typically must directly suffer from the loss. Insurable interest must exist whether property insurance or insurance on a person is involved. The concept requires that the insured have a "stake" in the loss or damage to the life or property insured. What that "stake" is will be determined by the kind of insurance involved and the nature of the property ownership or relationship between the persons. The requirement of an insurable interest is what distinguishes insurance from gambling.
Because contracts of insurance have many features in common with wagers, insurance contracts are often distinguished under law as agreements in which either party has an interest in the "bet-upon" outcome beyond the specific financial terms.

Casualty insurance

casualtycasualtiescasualty (liability) insurance
In the United States, the underwriting loss of property and casualty insurance companies was $142.3 billion in the five years ending 2003.
Casualty insurance is a problematically defined term which broadly encompasses insurance not directly concerned with life insurance, health insurance, or property insurance.

Underwriting profit

Upon termination of a given policy, the amount of premium collected minus the amount paid out in claims is the insurer's underwriting profit on that policy.
Underwriting profit is a term used in the insurance industry.

Insurance broker

insurance agentinsurance brokingagent
Claims may be filed by insureds directly with the insurer or through brokers or agents.
An insurance broker sells, solicits, or negotiates insurance for compensation.

Insurance cycle

underwriting cycleunderwriting, or insurance, cycle
This tendency to swing between profitable and unprofitable periods over time is commonly known as the underwriting, or insurance, cycle.
The tendency of the insurance industry to swing between profitable and unprofitable periods over time is commonly known as the underwriting or insurance cycle.

Edward Rowe Mores

Mores, Edward Rowe
Edward Rowe Mores established the Society for Equitable Assurances on Lives and Survivorship in 1762.
He was also instrumental in the founding of The Society for Equitable Assurances on Lives and Survivorships (now commonly known as Equitable Life), and is credited with being the first person to use the professional title actuary in relation to insurance.

Vehicle insurance

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For example, vehicle insurance would typically cover both the property risk (theft or damage to the vehicle) and the liability risk (legal claims arising from an accident).
Vehicle insurance (also known as car insurance, motor insurance or auto insurance) is insurance for cars, trucks, motorcycles, and other road vehicles.

Association of British Insurers

ABIBritish Insurance AssociationBritish Insurance Association Headquarters
The Association of British Insurers (gathering 400 insurance companies and 94% of UK insurance services) has almost 20% of the investments in the London Stock Exchange.
The Association of British Insurers or ABI is a trade association made up of insurance companies in the United Kingdom.