Also known as Medigap" insurance. Term - period of time for which policy is in effect. Morale Hazard - negligence or disregard on the part of the insured which could lead to probable loss. Contractual Liability - liability coverage of an insured who has assumed the legal liability of another party by written or oral contract. Authorized Control Level Risk Based Capital - theoretical amount of capital plus surplus an insurance company should maintain. Ceded Premium - amount of premium (fees) used to purchase reinsurance. Medicaid - policies issued in association with the Federal/State entitlement program created by Title XIX of the Social Security Act of 1965 that pays for medical assistance for certain individuals and families with low incomes and resources. We're here to help. Short-Term Medical - policies that provide major medical coverage for a short period of time, typically 30 to 180 days. Bonds - a form of debt security whereby the debt holder has a creditor stake in the company. Unauthorized Reinsurance - reinsurance placed with a company not authorized in the reporting company's state of domicile. Facultative Reinsurance - reinsurance for a specific policy for which terms can be negotiated by the original insurer and reinsurer. Joint Underwriting Association (JUA) - a loss-sharing mechanism combining several insurance companies to provide extra capacity due to type or size of exposure. Pro-rata (proportional) Reinsurance - portion of the losses and premium reinsurer shares with the ceding entity. Aggregate Cost Payments - method of reimbursement of a health plan with a corporate entity that directly provides care, where (1) the health plan is contractually required to pay the total operating costs of the corporate entity, less any income to the entity from other users of services, and (2) there are mutual unlimited guarantees of solvency. Captive Agent - an individual who sells or services insurance contracts for a specific insurer or fleet of insurers. Does not include self-insured business as well as FEHBP or Medicare and Medicaid programs. Individual Health - health insurance where the policy is issued to an individual covering the individual and/or their dependents in the individual market. Adverse Selection - the social phenomenon whereby persons with a higher than average probability of loss seek greater insurance coverage than those with less risk. This annuity contract provides for the initiation of payments at some designated future date. Group Annuities Unallocated - annuity contracts or portions thereof where the Insurer purchases an annuity for the retirees. Excludes amounts attributable to uninsured accidents and health plans and the uninsured portion of partially insured accident and health plans. Reinsurer - company assuming reinsurance risk. Underlying Interest - the asset(s), liability(ies) or other interest(s) underlying a derivative instrument, including, but not limited to, any one or more securities, currencies, rates indices, commodities, derivative instruments, or other financial market instruments. Commercial Flood - separate flood insurance policy sold to commercial ventures. Medicare pays a fixed amount for insured's care every month to the companies offering Medicare Advantage plans. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally. International - includes all business transacted outside the U.S. and its territories and possessions where the appropriate line of business is not determinable. Credit - individual or group policies that provide benefits to a debtor for full or partial repayment of debt associated with a specific loan or other credit transaction upon disability or involuntary unemployment of debtor, except in connection with first mortgage loans. An example is a tenant who, while occupying another party's property, through negligence causes fire damage to the property. Captive Insurer - an insurance company established by a parent firm for the purpose of insuring the parent's exposures. Irrevocable Beneficiary - a life insurance policy beneficiary who has a vested interest in the policy proceeds even during the insured's lifetime because the policy owner has the right to change the beneficiary designation only after obtaining the beneficiary's consent. Comprehensive/Major Medical - policies that provide fully insured indemnity, HMO, PPO, or Fee for Service coverage for hospital, medical, and surgical expenses. "Creditor Placed Home" means "Creditor Placed Insurance" on homes, mobile homes and other real estate. This article outlines industry practice and consideration for pricing acceleration-only riders to life insurance policies. Other Accident and Health - accident and health coverages not otherwise properly classified as Group Accident and Health or Credit Accident and Health (e.g., collectively renewable and individual non-cancelable, guaranteed renewable, non-renewable for stated reasons only, etc.). Group Annuities Deferred Variable - an annuity contract that provides an accumulation based fund where the accumulation varies in accordance with the rate of return of the underlying investment portfolio selected by the policyholder. Model state law of the NAIC that stipulates that the prospective purchaser of a dread disease insurance policy (catastrophic illness insurance policy) must be provided a quantitative illustration of the accelerated payout's effect on the death benefit, policy loan, premiums, and cash value of the life insurance policy. Superfund - federal act mandating retroactive liability for environmental pollution where responsible party maintains accountability for environmental clean-up regardless of length of time since polluting event occurred. Municipal Bond Guarantee Insurance - coverage sold to municipalities to guarantee the principle payment on bonds issued. Individual Annuities Immediate Variable - an annuity contract that provides for the first payment of the annuity at the end of the fixed interval of payment after purchase. The contract provides for the initiation of payments at some designated future date. 73 popular meanings of NAIC abbreviation: 50 Categories. Commercial Auto - coverage for motor vehicles owned by a business engaged in commerce that protects the insured against financial loss because of legal liability for motor vehicle related injuries, or damage to the property of others caused by accidents arising out of the ownership, maintenance, use, or care-custody & control of a motor vehicle. Insurable Interest - A right or relationship in regard to the subject matter of the insured contract such that the insured can suffer a financial loss from damage, loss or destruction to it. Warrant - an agreement that gives the holder the right to purchase an underlying financial instrument at a given price and time or at a series of prices and times according to a schedule or warrant agreement. Employee Benefit Liability - liability protection for an employer for claims arising from provisions in an employee benefit insurance plan provided for the economic and social welfare of employees. Structured Settlements - periodic fixed payments to a claimant for a determinable period, or for life, for the settlement of a claim. Bodily Injury - physical injury including sickness or disease to a person. Key-Persons Insurance - a policy purchased by, for the benefit of, a business insuring the life or lives of personnel integral to the business operations. Domestic Insurer - an insurance company that is domiciled and licensed in the state in which it sells insurance. Salvage - value recoverable after a loss. Established a framework of responsibilities of federal and state regulators for these financial industries. Contract Reserves - reserves set up when, due to the gross premium structure, the future benefits exceed the future net premium. Examples include abstracters, accountants, insurance adjusters, architects, engineers, insurance agents and brokers, lawyers, real estate agents, stockbrokers. Discover our framework to drive change and promote accountability in our workplace. Generally Accepted Accounting Principles (GAAP) - an aggregate of the accounting standards, principles and best practices for the preparation of financial statements allowing for consistency in reporting. Securitization of Insurance Risk - a method for insurance companies to access capital and hedge risks by converting policies into securities that can be sold in financial markets. Insurer - an insurer or reinsurer authorized to write property and/or casualty insurance under the laws of any state. Accelerated death benefits (excludable in whole or in part from gross income under section 101 (g)) paid under a life insurance contract or paid by a viatical settlement provider. Investments with original maturities of three months or less qualify under this definition. Boatowners/Personal Watercraft - covers damage to pleasure boats, motors, trailers, boating equipment and personal watercraft as well as bodily injury and property damage liability to others. Preferred Provider Organization (PPO) - arrangement, insured or uninsured, where contracts are established by Health Plan Companies (typically, commercial insurers, and, in some circumstances, by self-insured employers) with health care providers. Credit Risk - part of the risk-based capital formula that addresses the collectability of a company's receivables and the risk of losing a provider or intermediary that has received advance capitation payments. Workers' Compensation - insurance that covers an employer's liability for injuries, disability or death to persons in their employment, without regard to fault, as prescribed by state or federal workers' compensation laws and other statutes. Commercial Mortgage-Backed Securities - a type of mortgage-backed security that is secured by the loan on a commercial property. Health Plan - written promise of coverage given to an individual, family, or group of covered individuals, where a beneficiary is entitled to receive a defined set of health care benefits in exchange for a defined consideration, such as a premium. Accident Only or AD&D - policies providing coverage, singly or in combination, for death, dismemberment, disability, or hospital and medical care caused by or necessitated as a result of accident or specified kinds of accidents. Variable Life Insurance - life insurance whose face value and/or duration varies depending upon the value of underlying securities. Drafting Note: This definition does not prohibit an insurer, using an application or enrollment form, including a simplified application form, designed to elicit the health history of a prospective insured and on the basis of the answers on that application or enrollment form, from underwriting in accordance Frequently includes fire, allied lines, various other coverages (e.g., difference in conditions) and liability coverage. Earthquake - property coverages for losses resulting from a sudden trembling or shaking of the earth, including that caused by volcanic eruption. Retention Limit - maximum amount of medical and hospital expense an insurer will carry on its own. The Health Insurance Portability and Accountability Act, or HIPAA, resolved a good deal of the uncertainty surrounding the tax treatment of insured long-term care benefits and may have resolved the taxation of employer self-funded programs. Centers for Medicare & Medicaid Services (CMS) - U.S. governmental agency responsible for the licensing of federally qualified HMOs. Financial Guaranty - a surety bond, insurance policy, or an indemnity contract (when issued by an insurer), or similar guaranty types under which loss is payable upon proof of occurrence of financial loss to an insured claimant, obligee or indemnitee as a result of failure to perform a financial obligation or any other permissible product that is defined as or determined to be financial guaranty insurance. National Association Of Insurance Commisioners. Estimates are established to book these claims. Fire Legal Liability - coverage for property loss liability as the result of separate negligent acts and/or omissions of the insured that allows a spreading fire to cause bodily injury or property damage of others. Explore recent publications, the latest news articles, new federal and legislative news, and model laws to help inform your approach. Some words and/or phrases may be defined differently by other entities, or used in a context such that the definition shown may not be applicable. Health Excess/Stop Loss - this type of insurance may be extended to either a health plan or a self-insured employer plan. These standards accommodate Buyers of real and personal property and mortgage lenders rely upon the coverage to protect them against losses from undiscovered defects in existence when the policy is issued. Demutualization - conversion of a mutual insurance company to a capital stock company. Blanket coverage - coverage for property and liability that extends to more than one location, class of property or employee. An example would be provider-sponsored organizations where there is no coverage for other than provider (non-hospital) services. Intermediary - a person, corporation or other business entity (not licensed as a medical provider) that arranges, by contracts with physicians and other licensed medical providers, to deliver health services for a health insurer and its enrollees via a separate contract between the intermediary and the insurer. Permanent Life Insurance - policy that remains active for the life of the insured. Ceding Company - an insurance company that transfers risk by purchasing reinsurance. Kidnap/Ransom Insurance - coverage for ransom or extortion costs and related expenses. Loss Payable Clause - coverage for third party mortgagee in case of default on insured property, secured by a loan, that has been lost or damaged. Rebate - a refund of part or all of a premium payment. DEFINITIONS Activities of Daily Living - means the following self-care functions: Bathing - Washing oneself by sponge bath, or in either a tub or shower, including the task of getting into or out of the tub or shower. three essential characteristics: a) It embodies a present duty or responsibility to one or more other entities that entails settlement by probable future transfer or use of assets at a specified or determinable date, on occurrence of a specified event, or on demand; b) The duty or responsibility obligates a particular entity, leaving it little or no discretion to avoid the future sacrifice; and c) The transaction or other event obligating the entity has already happened. Professional Errors and Omissions Liability - coverage available to pay for liability arising out of the performance of professional or business related duties, with coverage being tailored to the needs of the specific profession. Assessed Value - estimated value for real or personal property established by a taxing entity. Advisory Organization - a group supported by member companies whose function is to gather loss statistics and publish trended loss costs. Stop.Call.Confirm is a registered service markof the National Association of Insurance Commissioners. NAIC Meaning. Life Flexible Premium Adjustable Life - a group life insurance that provides a face amount that is adjustable to the certificate holder and allows the certificate holder to vary the modal premium that is paid or to skip a payment so long as the certificate value is sufficient to keep the certificate in force, and under which separately identified interest credits (other than in connection with dividend accumulation, premium deposit funds or other supplementary accounts) and mortality and expense charges are made to individual certificates while providing minimum guaranteed values. Risk Retention Group - group-owned insurer organized for the purpose of assuming and spreading the liability risks to its members. Condos - homeowners insurance sold to condominium owners occupying the described property. Internet Liability Insurance/Cyber Insurance - coverage for cyber commerce including copyright infringement, libel, and violation of privacy. Comprehensive Personal Liability - comprehensive liability coverage for exposures arising out of the residence premises and activities of individuals and family members. Explore our open opportunities for your chance to join our team. Collateral Loans - unconditional obligations for the payment of money secured by the pledge of an investment. These are governed generally by National Association of Insurance Commissioners (NAIC) Model Regulation 620, which pertains to accelerated benefits other than tax-qualified long-term care insurance benefits. Index Annuity - an interest bearing fixed annuity tied to an equity index, such as the Dow Jones Industrial Average or S & P 500. Medical Professional Liability - insurance coverage protecting a licensed health care provider or health care facility against legal liability resulting from the death or injury of any person due to the insured's misconduct, negligence, or incompetence in rendering professional services. Auto Physical Damage - motor vehicle insurance coverage (including collision, vandalism, fire and theft) that insures against material damage to the insured's vehicle. Capital and Surplus - a company's assets minus its liabilities. Rider - an amendment to a policy agreement. What is NAIC meaning in Medical? Indemnity, Principle of - a general legal principle related to insurance that 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. Membership lists, services and education to serve you and your mission. Separate Account - segregated funds held and invested independently of other assets by an insurer for the purpose of a group retirement fund. Retrospective Rating - the process of determining the cost of an insurance policy based on the actual loss experience determined as an adjustment to the initial premium payment. Renters Insurance - liability coverage for contents within a renter's residence. An accelerated death benefit is a portion of a life insurance policy that allows policyholders to receive their death benefits before they actually die. Risk Based Capital (RBC) Ratio - ratio used to identify insurance companies that are poorly capitalized. Losses Incurred - Includes claims that have been paid and/or have amounts held in reserve for future payment. Assisted Living Care - a policy or rider that provides coverage only while a policyholder is confined to an assisted living facility and meets the policy requirements for coverage. What Is an Accelerated Death Benefit? Umbrella and Excess (Commercial) - coverage for the liability of a commercial venture 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. Loss - physical damage to property or bodily injury, Including loss of use or loss of income. This annuity contract provides for the initiation of payments at some designated future date. Include under this type of insurance multi-peril policies (other than farmowners, homeowners and automobile policies) that include coverage for liability other than auto. Calendar Year Deductible - in health insurance, the amount that must be paid by the insured during a calendar year before the insurer becomes responsible for further loss costs. Tenants - homeowners insurance sold to tenants occupying the described property. Risk - Uncertainty concerning the possibility of loss by a peril for which insurance is pursued. Elevators and Escalators Liability - liability coverage for bodily injury or property damage arising from the use of elevators or escalators operated, maintained or controlled by the insured. The state of domicile receives a schedule for each jurisdiction the company wrote direct business, or has amounts paid, incurred or unpaid. Industrial Life - Industrial life insurance, also called "debit" insurance, is insurance under which premiums are paid monthly or more often, the face amount of the policy does not exceed a stated amount, and the words "industrial policy" are printed in prominent type on the face of the policy. Statutory rules also govern how insurers should establish reserves for invested assets and claims and the conditions under which they can claim credit for reinsurance ceded. However, an ADB increases premium charges, and using it decreases the death benefit payable . This includes the following products: Multiple Peril Crop Insurance (MPCI); Catastrophic Insurance, Crop Revenue Coverage (CRC); Income Protection and Revenue Assurance. Stock Insurance Company - business owned by stockholders. Contingent Liability - the liability of an insured to persons who have incurred bodily injury or property damage from work done by an independent contractor hired by the insured to perform work that was illegal, inherently dangerous, or directly supervised by the insured. Commercial Earthquake - earthquake property coverage for commercial ventures. When purchasing an increasing death benefit (Option B) on an IUL, what happens to the chronic illness benefit? EDP Policies - coverage to protect against losses arising out of damage to or destruction of electronic data processing equipment and its software. Medicare Part D - Stand-Alone - stand-alone Part D coverage written through individual contracts; stand-alone Part D coverage written through group contracts and certificates; and Part D coverage written on employer groups where the reporting entity is responsible for reporting claims to the Centers for Medicare & Medicaid Services (CMS). The policy does not include coverage provided under comprehensive/major medical policies, Medicare Advantage, or for accelerated heath benefit-type products. Mortgage-Backed Securities - a type of asset-backed security that is secured by a mortgage or collection of mortgages. For example, let's say Jane Doe bought a life insurance policy with an accelerated death benefit. Business Auto - coverage for motor vehicles, other than those in the garage business, engaged in commerce. Preferred Risk - insured, or applicant for insurance, who presents likelihood of risk lower than that of the standard applicant. A glossary of insurance terms and definitions. Line of Business - classification of business written by insurers. Includes a contractual liability policy providing coverage for all obligations and liabilities incurred by a service contract provider under the terms of service contracts issued by the provider. Corrective Order - commissioner's directive of action to be completed by an insurer. Fronting - an arrangement in which a primary insurer acts as the insurer of record by issuing a policy, but then passes the entire risk to a reinsurer in exchange for a commission. This includes policies providing only nursing home care, home health care, community based care, or any combination. Total Revenue - premiums, revenue, investment income, and income from other sources. State of Domicile - the state where a company's home office is located. model state law of the NAIC that stipulates that the prospective purchaser of a dread disease insurance policy (catastrophic illness insurance policy) must be provided a quantitative illustration of the accelerated payout's effect on the death benefit, policy loan, premiums, and cash value of the life insurance policy. Valued Policy Law - state legislation which specifies that the insured shall receive the face amount of the policy in the event of a total loss to a dwelling rather than the actual cash value regardless of the principle of indemnity. Occurrence - an accident , including injurious exposure to conditions, which results, during the policy period in bodily injury or property damage neither expected or intended from the standpoint of the insured. Medicare Advantage Plan - an HMO, PPO, or Private Fee-For Service Plan that contracts with Medicare Advantage Prescription Drug Plan also includes drug benefits. Independent Adjuster - freelance contractor paid a fee for adjusting losses on behalf of companies. The buyer cashes in the full . Security - a share, participation, or other interest in property or in an enterprise of the issuer or an obligation of the issuer. Prior Approval Law - a state regulatory requirement for pre-approval of all insurance rates and forms. This article will discuss one particular category called living benefit riders or accelerated death benefit riders. Policyholders Surplus - assets in excess of the liabilities of a company or net income above any monies indebted to legal obligation. Variable Universal Life - combines the flexible premium features of universal life with the component of variable life in which excess credited to the cash value of the account depends on investment results of separate accounts. Have a question or request? Alternative Workers' Compensation - other than standard workers' compensation coverage, employer's liability and excess workers' compensation (e.g., large deductible, managed care). Mutual Insurance Holding Company - a company organized as a mutual and owning a capital stock insurer or insurers for the benefit of pooling risk for many people, typically those in the same industry. Dwelling Property/Personal Liability - a special form of package policy composed of dwelling fire and/or allied lines, and personal liability insurance. Continuing Care Retirement Communities - senior housing arrangements that in addition to housing include some provision for skilled nursing care. Select a state or jurisdiction for insurance department contact information. Browse our timeline to learn how we support insurance regulators in their mission to protect consumers and ensure fair and healthy insurance markets. Expense Ratio - percentage of premium income used to attain and service policies. An Accelerated Death Benefit (ADB) allows a life insurance policy owner to receive a portion of their death benefit from their insurance company in advance of their death. The definition of "long-term care insurance" under this Act is designed to allow maximum flexibility in benefit scope, intensity and level, while assuring that the purchaser's reasonable expectations for a long-term care insurance policy are met. Surety Bond - a three-party agreement whereby a guarantor (insurer) assumes an obligation or responsibility to pay a second party (obligee) should the principal debtor (obligor) become in default. Representatives from diverse groups who provide varied perspectives on insurance regulatory issues. What does NAIC mean as an abbreviation? The amount being accelerated wishes reduce the death benefit on the contract dollar for dollar. Business owners Policy - business insurance typically for property, liability and business interruption coverage. Assigned Risk - A governmental pool established to write business declined by carriers in the standard insurance market. "Creditor Placed Auto" means insurance on automobiles, boats or other vehicles. Residence - the domicile location of a member as shown by his or her determination as a resident. Adjuster - a person who investigates claims and recommends settlement options based on estimates of damage and insurance policies held. Primary Insurance - coverage that takes precedence when more than one policy covers the same loss. Access technology tools and resources for U.S. insurance regulators. The amount varies with the value of equities (separate account) purchased as investments by the insurance companies. This page provides a glossary of insurance terms and definitions that are commonly used in the insurance business. Early warning system - a system designed by insurance industry regulators of identifying practices and risk-related trends that contribute to systemic risk by measuring insurer' financial stability. Chartered Life Underwriter (CLU) - a professional designation awarded by the American College to persons in the life insurance field who pass a series of exams in insurance, investment, taxation, employee benefit plans, estate planning, accounting, management, and economics. The contract provides for the initiation of payments at some interval that may vary, however the annuity payouts must begin within 13 months. Health Maintenance Organization (HMO) - a medical group plan that provides physician, hospital, and clinical services to participating members in exchange for a periodic flat fee. Government, Business, Community . Pure Risk - circumstance including possibility of loss or no loss but no possibility of gain. Broker - an individual who receives commissions from the sale and service of insurance policies.
Nysdec Swppp Inspection Requirements,
Delayed Possession Agreement,
Articles N