Term
| Business Income Insurance |
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Definition
| Insurance that covers the reduction in an organization's income when operations are interrupted by damage to property caused by a covered peril |
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Term
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Definition
| The difference between revenues (such as money received for goods or services) and expenses (such as money paid for merchandise, rent, and insurance) |
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Term
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Definition
| Net Income that results when revenues exceed expenses |
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Term
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Definition
| Net income that results when expenses exceed revenues |
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Term
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Definition
| Expenses that continue to be incurred during a business interruption |
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Term
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Definition
| Expenses that will not continue during a business interruption |
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Term
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Definition
| Expenses, in addition to ordinary expenses, that an organization incurs to mitigate the effects of a business interruption |
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Term
| Business Income (and Extra Expense) Coverage Form |
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Definition
| Form that covers both business income and extra expense losses (even if the extra expenses do not reduce the business income loss) |
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Term
| Business Income (Without Extra Expense) Coverage Form |
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Definition
| Form that covers business income loss but covers extra expenses only to the extent that they reduce the business income loss |
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Term
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Definition
| Sum of (1) net profit or loss that would have been earned or incurred if the suspension had not occured and (2) normal operating expenses, including payroll, that continue during the suspension |
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Term
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Definition
| The period during which business income loss is covered under the BIC forms; it begins 72 hours after the physical loss occurs and ends when the property is (or should have been) restored to use with reasonable speed. (With regard to extra expense coverage, it begins immediately after the physical loss occurs) |
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Term
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Definition
| Coverage for necessary expenses incurred by the named insured to reduce business income loss; the expenses are covered only to the extent they actually reduce the business income loss. |
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Term
| Civil Authority additional coverage |
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Definition
| Coverage for loss of business income that results when access to the insured's premises is prohibited by civil authority because of damage to property other than the insureds |
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Term
| Extended Business Income (EBI) additional coverage |
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Definition
| Coverage for business income losses that contineu after the period of restoration ends; the coverage begins when the damaged property has been restored and ends when the insured's business returns to normal, subject to a maximum of 30 days |
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Term
| Probable Maximum Loss (PML) |
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Definition
| THe largest loss that an insured is likely to sustain |
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Term
| Maximum Period of Indemnity coverage option |
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Definition
| Option that deletes the conisurance clause while limiting loss payment to the lesser of (1) the amount of loss sustained during the 120 days following the beginning of the period of restoration or (2) the policy limit |
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Term
| Montly limit of Indemnity coverage option |
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Definition
| Option that deletes the coinsurance clause while limiting the amount recoverable during any month of business interruption to a stipulated fraction (1/2, 1/4 or 1/3) of the insurance amount |
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Term
| Business Income Agreed Value Coverage Option |
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Definition
| Option that suspends the coinsurance clause as long as the insured carries an amount of business income insurance that is equal to the value agreed on by the policyholder and the insurer. |
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Term
| Extended Period of Indemnity coverage option |
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Definition
| Option that extends the duration of EBI coverage to include business income losses that continue for more than 30 days after the property is restored |
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Term
| Extra Expense Coverage Form |
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Definition
| Form that covers extra expenses only |
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Term
| Dependent property exposure |
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Definition
| The possibility of incurring business income loss because of physical loss occurring on the premises of an organization that the insured depends on for materials, products, or sales. |
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Term
| Ordinary Payroll Limitation or Exclusion endorsement |
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Definition
| Endorsement that limits coverage for ordianry payroll expenses to a specified number of days or excludes such expenses altogether, allowing the insured to satisfy the coinsurance requirement with a lower amount of insurance |
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Term
| Power, Heat and Refrigeration Deduction Endorsement |
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Definition
| Endorsement that eliminates power, heat, and refrigeration expenses from coverage and from the coinsurance calculation, allowing the insured to satisfy the coinsurance requirement with a lower limit of insurance |
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Term
| Ordinance or Law Increased Period of Restoration endorsement |
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Definition
| Endorsement that covers business income loss during the additional time required to comply with building ordinances or laws |
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Term
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Definition
| Form that covers fire, lightning, expolosion, windstorm, hail, smoke, aircraft, vehicles, riot, civil commotion, vandalism, sprinkler leakage, sinkhole collapse, and volcanic action |
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Term
| Concurrent causation doctrine |
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Definition
| Approach that a loss is covered when caused by two or more independent, concurrent perils if only on eo fthe perils is covered--even if the other peril or perils ar clearly excluded. |
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Term
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Definition
| Form that covers basic form perils pls falling objects; weight of snow, ice, or sleet; water damage; and (as additional coverage collapse caused by certain perils |
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Term
| Causes of Loss-Special Form |
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Definition
| Form that covers "risks of direct physical loss," subject to the form's exclusions and limitations |
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Term
| Builders Risk Coverage Form |
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Definition
| Form that covers buildings in the course of construction, including additions or alterations to existing buildings |
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Term
| Condominium Association Coverage Form |
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Definition
| Form that covers buildingsand business personal property of condominium associations |
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Term
| Condominium Commercial Unit-Owners Coverage Form |
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Definition
| Form that covers business personal property and building property exposures of commercial (nonresidential) condominium units |
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Term
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Definition
| Coverage for a commercial condominium unit-owner's share of any assessment made by the association against all unit owners because of physical loss to condominium property caused by a covered cause of loss |
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Term
| Miscellaneous real property coverage |
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Definition
| Coverage for real property (such as storage shed or garage building) that pertains only the named insured's condominium unit or real property that the named insured has a duty to insure according tot he condominium association agreement |
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Term
| Insurance for highly protected risks |
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Definition
| Property insurance that covers large property risks with superior loss protection characteristics; has broader coverage than most commercial property policies and usually a lower premium rate |
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Term
| Ordinance or Law Coverage endorsement |
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Definition
| Endorsement that covers three types of losses resulting from the enforcement of building ordinances or laws: (1) the value of the undamaged portion of a building that must be demolished, (2) the cost to demolish the building's undamaged portion and remove its debris, and (3) the increased cost to rebuild the property |
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Term
| Spoilage Coverage endorsement |
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Definition
| Endorsement that covers damage to perishable stock due to power outages; on-premises breakdown; or contamination of the insured's refrigerating, cooling, or humidity control equipment |
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Term
| Manufactures' Consequential Loss Assumption endorsement |
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Definition
| Endorsement that covers reduction in value of undamaged property due to physical loss to other property |
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Term
| Brands and Labels endorsement |
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Definition
| Endorsement that permits the insured, when the insurer takes damaged merchandise as salvage, to stamp the word "salvage" on the merchandise or to remove its brands or labels before sale |
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Term
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Definition
| the process by which an insurer can, after it has paid a loss under the policy, recover the amount paid from any party (other than the insured who caused the loss or is otherwise legally liable for the loss |
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Term
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Definition
| a rating approach that bases a building's property insurancfe rate on inspecting and evaluating that particular building |
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Term
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Definition
| A rating approach that uses rates reflecting the average probability of loss for businesses within large groups of similar risks; the predominant method used for rating commerical properties |
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