Glossary
Choose a letter
- Credit and surety insurance
- Credit insurance provides cover against loss to a supplier caused by customer insolvency. Surety insurance is a commitment to a bondholder to substitute for his debtor in case of default by the latter.
- Decennial insurance
- Decennial insurance provides cover to building owners and construction companies against losses caused by structural defects in new buildings resulting from inherent defects in design, construction or the materials employed. In a number of countries, including France, such coverage is required as a matter of law. It is generally granted for a period of ten years after construction is completed.
- Deposit
- Amount deposited with the ceding company to guarantee the reinsurer's liabilities. Cash deposits generally earn interest at a rate agreed at the time of writing the business. Income from securities deposited accrues to the reinsurer.
- Direct insurance
- A policy written with an insurer by an individual or a company to cover a risk (property, service or person). This policy can either be underwritten directly with one of the insurer's agents or via a broker who receives a commission.
- Earned premiums
- Fraction of the premium corresponding to the expired portion of time for which the reinsured policy(ies) was/were in effect. The unearned portion of premiums is recorded in the premium reserve and carried under technical reserves.
- Equalization reserve
- Long-term reserve set aside by the insurer or reinsurer in order to equalise operating results from certain risks, notably catastrophes.
- Event
- Aggregation of claims having a common fortuitous origin and affecting either a single insured under more than one policy, or more than one insured.
- Facultative reinsurance
- Reinsurance on an item-by-item, risk-by-risk basis. Facultative reinsurance is usually written for very large-line risks. It may be either proportional or non-proportional.
