Insurance Glossary

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A clause in property insurance policies prohibiting the insured from abandoning damaged property to the insurer for repair or disposal. Arranging for repair or disposal is the insured's responsibility, unless the insurer elects otherwise.


In general, an unplanned, unexpected, and undesigned (not purposefully caused) event which occurs suddenly and causes (1) injury or loss, (2) a decrease in value of the resources, or (3) an increase in liabilities. As a technical term 'accident' does not have a clearly defined legal meaning. In insurance terminology, an accident is the events which is not deliberately caused, and which is not inevitable. For example, if a driver (who is covered under personal automobile insurance for injury and losses due to negligence) willfully drives the vehicle into a tree, the resulting injury or loss is not insured. Similarly, insurance policies do not compensate for obsolescence or wear and tear because their occurrence is inevitable in normal course of things.

Accident Insurance.

Policy that pays out upon the insured's death due to an accident or incapacitating bodily injury.


An insurance professional skilled in the analysis, evaluation and management of statistical information. Evaluates insurance firms’ reserves, determines rates and rating methods, and determines other business and financial risks.

Actuarial Calculations

mathematical and statistical research of methods of forming of insurance reserves, insurance rates by insurance types.


Document or information attached or added to clarify, modify, or support the information in the original insurance or reinsurance agreement.


One who settles insurance claims. This typically involves investigation of the loss and a determination of the extent of coverage. In the context of first-party (e.g., property) insurance, the adjuster negotiates a settlement with the insured. In liability insurance, the adjuster coordinates the insured's defense and participates in settlement negotiations. Adjusters may be employees of the insurer (staff adjusters) or of independent adjusting bureaus (independent adjusters) that represent insurers and self-insureds on a contract basis. Public adjusters are consultants who specialize in assisting insureds in presenting claims to insurance companies in a manner that will maximize their recovery. (see also Dispacheur).

Aggregate Limit Of Liability

An insurance contract provision limiting the maximum liability of an insurer for a series of losses in a given time period—for example, a year or for the entire period of the contract. Sometimes called "annual aggregate limit."

All Risks Coverage

Property insurance covering loss arising from any fortuitous cause except those that are specifically excluded. This is in contrast to named perils coverage, which applies only to loss arising out of causes that are listed as covered. Although many industry practitioners continue to use the term "all risks" to describe this approach to defining covered causes of loss in a property insurance policy, it is no longer used in insurance policies because of concern that the word "all" suggests coverage that is broader than it actually is. Because of this concern, some industry practitioners have begun to use the term "open perils" or "special perils" instead of "all risks."


A life insurance product that pays periodic income benefits for a specific period of time or over the course of the annuitant’s lifetime. There are two basic types of annuities: deferred and immediate. Deferred annuities allow assets to grow tax-deferred over time before being converted to payments to the annuitant. Immediate annuities allow payments to begin within about a year of purchase (see also Deferred Annuity)


services of medical, technical or financial nature provided under the contract of insurance to travelers in case of insurance event: injury, illness, and etc. They include services of medical professionals, delivery by specialized transport to the hospital, stay there, transporting the suffered to the place of residence, and etc. Services are usually provided by specialized assistant companies. There is a number of companies specialized in assistance services working closely with insurance companies.

Assistance Company

The company which has cooperation agreement the insurer and arranges medical and other assistance to the insured to the extent stipulated by insurance contract. Typically, assistance service supervises and regulates insurance cases abroad.

Average Adjuster

specialist in international sea law who allocates expenses from general average between the vessel, cargo and freight, i.e. makes average statement. Abroad, average adjuster is usually appointed by the ship-owner.

Average Adjustment

calculation of the loss and its distribution between the ship, freight and cargo in proportion to their value, as well as a special document determining the fact of general average in the shipwreck which is the basis for calculation of losses in the accident.

Average Certificate

document compiled by average commissioner recording the size and causes of losses and containing other information describing the circumstances surrounding the incident. Average Certificate is only evidence of loss and is not intended to be bound payment. On the basis of the average certificate insurer decides to pay or reject the claims of the insured for insurance indemnity.

Average Commissioner

Authorized individual or entity who’s dealing with determining reasons, conditions and values of losses in marine hull and cargo insurance. Insurer appoints average commissioner both inside the country and abroad in accordance with legislation of domicile country. According to the results of the work, average commissioner prepares average certificate. Function of average commissioner is performed by adjuster

Auto Insurance Policy

Insurance coverage that provides indemnity and/or compensation for injury or physical damage which ensues from the ownership, use or operation of an automobile. There are basically six different types of coverages. Some may be required by law. Others are optional. They are:

  • Bodily injury liability, for injuries the policyholder causes to someone else.
  • Medical payments or Personal Injury Protection (PIP) for treatment of injuries to the driver and passengers of the policyholder’s car.
  • Property damage liability, for damage the policyholder causes to someone else’s property.
  • Collision, for damage to the policyholder’s car from a collision.
  • Comprehensive, for damage to the policyholder’s car not involving a collision with another car (including damage from fire, explosions, earthquakes, floods, and riots), and theft.
  • Uninsured motorists coverage, for costs resulting from an accident involving a hit-and-run driver or a driver who does not have insurance.

Automobile Physical Damage Insurance

Automobile insurance coverage that insures against damage to the insured's own vehicle. Coverage is provided for perils such as collision, vandalism, fire, and theft (see also Auto Insurance Policy).

Aviation Insurance

Commercial airlines hold property insurance on airplanes and liability insurance for negligent acts that result in injury or property damage to passengers or others. Damage is covered on the ground and in the air. The policy limits the geographical area and individual pilots covered.


Banking Insurance

Rather new type of insurance carried out by commercial banks (except for deposit insurance). In Western Europe and USA banking insurance is invasion of commercial banks in insurance sphere (mainly in personal insurance); expressed in purchasing acting insurance companies and/or (if permitted by law) insurance policies sales network through wide network of bank branches and divisions.


Person or other legal entity for whose present or future interest (benefit) an insurance policy is made.

Block Insurance

In foreign practice any insurance; covers risks related to more than one type of goods being shipped from different transport means and with significant number of smaller parties.

Bodily Injury

Liability insurance term that includes bodily harm, sickness, or disease, including resulting death.


In insurance: amount of money in excess of ordinary income paid to the policyholder by the insurer who received profit from investing insurance reserves for life insurance, i.e. monies that are distributed or assigned to policyholders with participation in company profits.


a memorandum or invoice prepared for a company by an underwriter, containing a list of reinsured risks


The commission that is payable to a broker for placing an insurance or reinsurance contract with an insurer or a reinsurer. Compare fee for service. Although brokerage is payable by the insured as part of the gross premium the amount of brokerage is agreed by the insurer. The insured may request his broker to state the amount of his brokerage on a given placement. Similar considerations apply to reassureds under reinsurances. Sometimes the term brokerage may be used to refer the business of a broker.


Theft of property from within a premises by a person who unlawfully enters or exits from the premises.

Business Interruption Insurance

Indemnification for ongoing fixed expenses and loss of income, following a business stoppage. Such coverage may be added to an existing basic fire insurance policy.



An insurance company that has as its primary purpose the financing of the risks of its owners or participants. Typically licensed under special purpose insurer laws and operated under a different regulatory system than commercial insurers. The intention of such special purpose licensing laws and regulations is that the captive provides insurance to sophisticated insureds that require less policyholder protection than the general public.


All articles, goods, materials, merchandise, or wares carried onboard an aircraft, ship, train, or truck, and for which an air waybill, or bill of lading, or other receipt is issued by the carrier. It includes livestock, but usually does not include bunkers (fuel for powering the vessel or vehicle), accompanying baggage, vessel or vehicle's equipment and spare parts, mail, and stores. Personnel carried onboard are classified as crew or passengers.

Cargo Insurance

Inland or ocean marine insurance covering property in transit.

Cargo Theft

theft of other people's property in the process of transportation or storage, theft of the part or the entire contents of the consignment; theft of, usually, part or all items contained in the consignment or cargo performed by a person having official access to the property or under his management (for example, warehouse employee, a member of the crew). This term is most commonly used in the practice of cargo insurance.

Cash Loss

A provision in most proportional treaty contracts allows cedents the option of requesting from the reinsurer immediate settlement outside the claim recoveries usually made in the regular accounts. In order to make this request the loss settled by the ceding company must exceeds a predetermined amount.

Cash Surrender Value

The amount of money that an insurance company pays the insured upon cancellation of a life insurance policy before death and which is a specific figure assigned to the policy at that particular time, reduced by a charge for administrative expenses.


A disaster involving multiple insureds and/or locations which causes severe property damage. Common catastrophe types include hurricanes, earthquakes, tornadoes, and explosions. Term used for statistical recording purposes to refer to a single incident or a series of closely related incidents causing severe insured property losses totaling more than a given amount.


a syndicate or company that transfers a risk exposure under a reinsurance contract.


transferring risk from an insurance company to a reinsurance company.


transfer of risk from an insurance company to a reinsurance company.


person to whom something is transferred. In insurance, it is reinsurer taking part of the risk into reinsurance.

Characteristics Of Insurance Policy

a brief summary of the insurance policy which includes its main terms (eg, types of insurance cover provided, the limits of liability, insurance premiums, and etc.)


articles of incorporation or the rights from state to incorporate and transact business. A document issued by a sovereign, legislature, or other authority, creating a public or private corporation. A document outlining the principles, functions, and organization of a corporate body.

Children Insurance

Insurance of life of a child or a minor (under 18 years).


Insurance of profit and other financial losses related to standing still or idle of mills, factories, etc. due to insurance event.

Civil Liability

An individual's liability to others for harm caused to them by his or her actions. Legal obligations arising from private wrongs or a breach of contract that is not a criminal act (public wrong). In accordance with the laws of Uzbekistan, the individual must compensate the caused damage, so civil liability is the object of insurance in which responsibility to pay for damage lies on the insurer (see also Civil Liability Insurance).

Civil Liability Insurance

Insurance paying or rendering service on behalf of an insured for loss arising out of legal liability to others.


Used in reference to insurance, a claim may be a demand by an individual or corporation to recover, under a policy of insurance, for loss that may come within that policy.

Claim Settlement

Final declaration of payment and indemnity payment.


This may refer to either of the following situations: (a) Where two or more insurers underwrite the same risk with several liability such that each insurer is not bound to follow the decisions of any co-insurer unless it has agreed to do so. (b) Where the insured acts as its own insurer for a specified proportion of the sum insured.


One that shares the loss sustained under an insurance policy. Usually refers to an insured property owner that fails to purchase enough insurance to comply with the coinsurance provision and that, therefore, suffers part of the loss itself.

Collective Insurance

See Group Insurance

Combined Insurance

A package policy providing several different coverages. Usually refers to a policy providing both general liability insurance and property insurance. Premium discounts are usually allowed to reflect cost efficiencies.


Sworn statement filed by a party (the complainant, petitioner, or plaintiff) to a court to commence litigation against another party (the accused, defendant, or respondent) in a civil lawsuit. Complaint sets forth the alleged grounds (allegations) for the case and request for award of relief (damages) or recovery of some asset such as money or property. In criminal cases the complaint is filed by the public prosecutor, a government official. Also called petition.

Comprehensive Insurance Policy

Export (export credit) insurance against both political and commercial risks.

Construction Object

building or construction being erected with all related equipment, tools, supplies, materials, galleries, platforms, water supply and sewer networks, gas, heating and electric systems.

Correction Factors

factors used by the insurer (underwriter) that regulate both increase and decrease of insurance rate according to the risk level of a particular object or individual.

Court Appearance

The appearance in person of an individual charged with a crime or included as part of a lawsuit in a court of law. The individual can be physically not present but be represented by an attorney and still be legally present.


concentration of risks within a certain location.

Cumulative Insurance Program

insurance programs containing in addition to risk-coating, also an element of savings or accumulation of cash. Such cumulative insurance programs include, for example, personal insurance, pension insurance, and etc.

Customs Broker

Established in accordance with the laws of the Republic of Uzbekistan commercial organization, being a legal entity, that has received license from the State Customs Committee of the Republic of Uzbekistan for implementation of intermediary activities as a customs broker and is listed in the State Register of customs brokers. Customs broker carries out operations of customs clearance of goods and vehicles and other intermediary functions in the customs sphere for the account and on behalf of the represented person.

Customs Carrier

Carrier who transports goods under the customs control in accordance with the Customs Code of the Republic of Uzbekistan and the Statute of the customs carrier.



Harm or injury to a person, property, or system resulting in impairment or loss of function, usefulness, or value. (see Insured damage).

Damage to supplementary equipment.

Theft, damage or destruction as a result of traffic accident, fire, explosion, natural disasters, as well as illegal acts of third parties to supplementary equipment insured.

Damage To Transport Facilities (Cargo, Property)

Damage to the original form and/or integrity of the transport facilities (cargo, property), some of its parts becoming worthless.

Declared Loss

The amount the insurer is required to pay because of a happening against which it was insured.


The amount that is deducted from some or all claims arising under an insurance or reinsurance contract. The practical effect is the same as an excess: the insured or reassured must bear a proportion of the relevant loss. If that loss is less than the amount of deductible/excess then the insured or reassured must bear all of the loss (unless there is other insurance in place to cover the deductible). An increase in deductible should result in a reduction in premium. There is conditional and unconditional franchise. Conditional franchise states that the policy will not pay any claims less than a given amount but will pay claims in total if they are in excess of that amount. Unconditional deductible – in all cases deductible amount is subtracted from the insurance indemnity. The deductible is usually set as a fixed dollar amount, though in some cases it can also be a percentage of the premium paid or some other formula.

Deferred Annuity

Annuity in which payback does not start until a specified time in the future, such as after a certain number of years from the annuity contract date, or at a certain age of the annuitant or the beneficiary. (see also Annuity)

Disability Degree

Set by MLEC (Medical Labor Expert Commission) depending on the disability extent. There are three degrees of disability.


loss of the earning capacity resulting from injury caused to a workman by an accident.


Statutory revelation by the applicant (in the application for an insurance policy) of all known information about the risk to be covered.


In insurance those insureds who did not have insurance events during certain period of time might use discount.


abnormal condition affecting the body of an organism. It is often construed to be a medical condition associated with specific symptoms and signs. It may be caused by external factors, such as infectious disease, or it may be caused by internal dysfunctions, such as autoimmune diseases.


A partial return of premium to the insured based on the insurer's financial performance or on the insured's own loss experience. Insurers cannot legally guarantee the payment of dividends. In the captive arena, there are two kinds: policyholder dividends are paid back through the insurance premium process to the insureds. They are before-tax expenses for the captive. Shareholder dividends are paid to the captive's shareholders after tax (and are then taxed again to the shareholder).



Each And Every Loss

generally accepted concept in the international insurance practice. Condition of insurance contract (clause) meaning that Insurer will indemnify each and every loss incurred as a result of one or series of cases that have occurred as a result of catastrophic event (natural disaster).

Economic Indicators Of Insurance Activity:

- The average sum insured (the total sum insured divided by the number of insured objects);- The average premium payment per agreement (the amount of premium received divided by the number of agreements);- The loss ratio (the ratio of incurred losses and loss-adjustment expenses to net premiums earned.);- The sum insured loss ratio - the amount of payments accounting for an average of 100 units of the sum insured.

Emergency Care

Emergency care refers to emergency medical attention given to an individual who needs it. It includes those medical services required for the immediate diagnosis and treatment of medical conditions which, if not immediately diagnosed and treated, could lead to serious physical or mental disability or death.


Person or firm who, by signing a negotiable instrument, transfers the title of the instrument (or the property named therein) to another.


A written form attached to an insurance policy that alters the policy’s coverage, terms, or conditions. Sometimes called a rider.

Environmental Impairment Liability (Eil) Insurance

A specialized insurance policy that covers liability and sometimes cleanup costs associated with pollution.

Examination Report

document about the required examination and its results.

Extra Expense Coverage

Time element property insurance that pays for expenses in excess of normal operating expenses that an organization incurs to continue operations while its property is being repaired or replaced after having been damaged by a covered cause of loss. Extra expense coverage can be purchased in addition to or instead of business income coverage, depending on the needs of the organization.

Extra Premuim

A charge added to a premium because the regular premium rate does not take into account certain hazards.


Facultative reinsurance

A form of reinsurance whereby each exposure the ceding company wishes to reinsure is offered to the reinsurer and is contained in a single transaction. The submission, acceptance, and resulting agreement is required on each individual risk that the ceding company seeks to reinsure. That is, the ceding company negotiates an individual reinsurance agreement for every policy it will reinsure. However, the reinsurer is not obliged to accept every or any submission.

First Aid Care

defined as medical care and treatment provided after the sudden onset of a medical condition manifesting itself by acute symptoms, including severe pain, which are severe enough that the lack of immediate medical attention could reasonably be expected to result in any of the following: the patient's health would be placed in serious jeopardy; bodily function would be seriously impaired; there would be serious dysfunction of a bodily organ or part.

First Risk Insurance

Method of insurance whereby a specified amount is guaranteed: the risk is covered up to such risk regardless of the total value, without applying the proportional rule.


clause found in insurance policy that states that the policy will not pay any claims less than a given amount but will pay claims in total if they are in excess of that amount. In this case, franchise is set as an absolute figure.


The charge for transporting goods.


General Average

A loss that arises from the reasonable sacrifice at a time of peril of any part of a ship or its cargo for the purpose of preserving the ship and the remainder of its cargo together with any expenditure made for the same purpose. An example of a general average loss would include jettisoning cargo to keep a ship afloat and an example of general average expenditure would include towing a stricken vessel into port. An average adjuster calculates the value of each saved interest to each interested party which is then obliged to contribute towards the general average loss or expenditure proportionately. Subject to the terms of the policy, insurance will generally only apply if the loss was incurred to avoid or in connection with the avoidance of an insured peril.

General Policy

insurance agreement under which the insured is obliged to insure all certain risks by similar conditions. For example, goods to be received or sent within a specified period of time are to be insured with one insurer, and he should be responsible for all risks insured, including those which were not declared in time. Usually issued for a period of one year.

Green Card

The Council of Bureaux (CoBx) maintains an international motor insurance card system in and around Europe where the certificate issued is known by the name Green card. In 1949 the system was established in the framework of UNECE. At later stage the EU and EFTA were involved and reflecting the deepening of the links with them the CoBx secretariat was relocated from London to Brussels in 2006. In each member state of the Green Card System the insurance companies established an Green Card Bureaux operating with the recognition and approval of the government and the activities of the Green Card Bureaux are established by law or regulation in each of the countries participating in the system. Each Green Card Bureau has two functions: 1. As a "Bureau of the country of the accident", it has responsibility in accordance with national legal provisions for Compulsory Third Party Motor Insurance for the handling and settlement of claims arising from accidents caused by visiting motorists. 2. As a "Guaranteeing Bureau" it guarantees certificates of Motor Insurance - ("Green Cards") which are issued by its member insurance companies to their policyholders. There are three types of Green card member states as per the Multilateral Agreement: 1. EEA members 2. members under section III of the Multilateral Agreement with the EEA members: Andorra, Croatia, Serbia and Switzerland. 3. the rest of the Green card members

Gross Premium

Original and additional inward premiums, plus any amount in respect of administration fees or policy expenses remitted with a premium but before the deduction of outward reinsurance premiums.

Group Insurance

Insurance provided to groups of people. Involves the substitution of group selection, the use of experience rating, and the use of a master insurance contract. These aspects of group insurance yield lower administrative costs than would individual policies written for members of the group. Group insurance is commonly used to provide employees and members of associations with life, health, disability, dental, and similar types of coverage.



A risk management strategy used in limiting or offsetting probability of loss from fluctuations in the prices of commodities, currencies, or securities. In effect, hedging is a transfer of risk without buying insurance policies.


Stealing of transport facility, unlawful possession of transport facility.

Hull Insurance

Marine or aviation insurance covering damage sustained to an insured vessel or airplane.



Discrete occurrence or event or untoward event which (depending on the circumstances) may lead to a damage, disaster, or loss.


(1) In policies written on an indemnification basis, the insurer reimburses the insured for claims and claim costs already paid by the insured. Technically, the insured must not only suffer a loss but must also pay the loss before being indemnified by the insurer. (2) The agreement of one party to assume financial responsibility for the liability of another party. Hold harmless agreements are typically used to impose this transfer of risk (see also indemnity and Insurance Coverage).


The principle according to which a person who has suffered a loss is restored (so far as possible) to the same financial position that he was in immediately prior to the loss, subject in the case of insurance to any contractual limitation as to the amount payable (the loss may be greater than the policy limit). The application of this principle is called indemnification. Most contracts of insurance are contracts of indemnity. Life insurances and personal accident insurances are not contracts of indemnity as the payments due under those contracts for loss of life or bodily injury are not based on the principle of indemnity (see also Indemnification and Insurance Coverage).


Disease or impairment of a person's body or mind.


A contractual relationship that exists when one party (the insurer) for a consideration (the premium) agrees to reimburse another party (the insured) for loss to a specified subject (the risk) caused by designated contingencies (hazards or perils). The term "assurance," commonly used in England, is considered synonymous with "insurance."

Insurance Agent

A person or organization who/that is authorized to act on behalf of another. An insurance agent is a person or organization who/that solicits, negotiates, or instigates insurance contracts on behalf of an insurer and can be independent or an employee of the insurer. Insurance agents are the legal representatives of insurers, rather than policyholders, with the right to perform certain acts on behalf of the insurers they represent, such as to bind coverage.

Insurance Agreement

contract between the insured and the insurer, with the mediation of an agent or broker or not, by which the insurer undertakes to indemnify the insured as a result of the insured event or to pay him (or beneficiary) the sum insured (indemnity), and the insurer agrees to pay a premium in full and on time.

Insurance Broker

An insurance intermediary who/that represents the insured rather than the insurer. Since they are not the legal representatives of insurers, brokers, unlike independent agents, often do not have the right to act on behalf of insurers, such as to bind coverage. While some brokers do have agency contracts with some insurers, they usually remain obligated to represent the interests of insureds rather than insurers. For example, some state insurance codes impose a fiduciary responsibility to act on behalf of their customers or provide full disclosure of all their compensation from all sources.

Insurance Control

Control over insurance companies’ activities by special authorized state body.

Insurance Coverage

The level of insurance estimate relative to the value of property interests accepted for insurance purpose. Insurance coverage might be the proportional liability system, limited liability insurance and first risk insurance. The most commonly used in practice are the proportional liability system and first risk insurance (See also Indemnification and Indemnity).

Insurance Currency

The currency in which all financial transactions or amounts under the policy are denominated.

Insurance Declaration

The front page (or pages) of a policy that specifies the named insured, address, policy period, location of premises, policy limits, and other key information that varies from insured to insured. The declarations page is also known as the information page. Often informally referred to as the "dec" or "dec page" that varies from insured to insured. Statement, signed by the insured, warranting that information given by him is true.

Insurance For The Benefit Of Others

insurance agreement concluded by one person in order to ensure coverage of the insurable interest of another person.

Insurable Interest

An interest by the insured person in the value of the subject of insurance, including any legal or financial relationship. Insurable interest usually results from property rights, contract rights, and potential legal liability.

Insurance Liability

See Liability

Insurance Market

the system of economic relations arising in regards to the purchase and sales of insurance coverage to meet social needs for insurance protection.

Insurance Marketing

One of the main functions of insurance companies’ activities to promote their products to the policyholder. Carried out through insurance marketing service of the company that forms the demand for insurance services and potential customer’s insurable interest.

Insurance Operations Effectiveness

comprehensive concept that includes a system of indicators characterizing the economic expediency of insurance among different insurance types (personal, property and liability insurance).

Insurance Policy

See Policy

Insurance Portfolio

The book of business of an insurer or reinsurer, including all policies in force and open reserves.

Insurance Premium

The amount of money an insurer charges to provide the coverage described in the policy or bond.

Insurance Product

Final result of development of particular type of insurance represented by a set of documents.

Insurance Protection

A system to make large financial losses more affordable by pooling the risks of many individuals and business entities and transferring them to an insurance company or other large group in return for a premium.

Insurance Purpose

insurance protection of material interests of individuals, businesses, cooperatives, and other legal entities in the form of full or partial recovery of damages and losses caused by natural disasters, accidents and events in various areas of human activity as well as payments to the individuals in case of loss event, from insurance fund created on the basis of obligatory and voluntary insurance payments of participants.

Insurance Rate

An insurance rate is the amount of money necessary to cover losses, cover expenses, and provide a profit to the insurer for a single unit of exposure. Rates, as contrasted with loss costs, include provision for the insurer's profit and expenses.

Insurance Relations Equivalence

guaranteed insurance payments at the expense of received insurance premiums.

Insurance Reserves

The amount of money that has been set aside by an insurer or reinsurer to meet outstanding claims, incurred but not reported losses and any associated expenses.

Insurance Risk

Risk of loss associated with fortuitous occurrences (e.g., fires, hurricanes, tortuous conduct). Event risk, which is synonymous with pure risk, hazard risk, or insurance risk, presents no chance of gain, only of loss. The perils covered by traditional property-casualty (P&C) insurance products are within the realm of event risk (in detail see Peril).

Insurance Rules

normative act, source of law determining the conditions of voluntary insurance. Establishes the rights and obligations of the parties under insurance contract, the insurance object, list of insurance events and exclusions (clauses) allowing the insured to release from responsibility. Insurance rules are generally set forth in the insurance policy or are an integral part of the insurance contract. Approved by the head of the insurance company and the state insurance supervision body (see also Policy conditions).

Insurance To Value

The amount of insurance written on property is approximately equal to its value. An insured most always wants to insure all property to value.


A person who is insured under a contract of insurance. Where there is one insured this person may also be referred to as the policyholder.

Insured Damage

value of fully destroyed or devaluated parts of the damaged property according to insurance estimates. Based on the calculated amount of the insured damage it is determined the amount of insurance indemnity due. Insurance agreement terms are taken into account. The amount of insurance indemnity shall be equal to amount of the insured damage. The size of the insured damage is determined either by the insurer or appointed on his behalf trusted expert (adjuster). The sum insured is considered when calculating the insured damage.

Insured’s Application

A form providing the insurer with certain information necessary to underwrite a given risk. The applicant completes it to receive insurance.


The insurance company that undertakes to indemnify for losses and perform other insurance-related operations.

Insurer’s Liability Limit For Each Insurance Event

The most that will be paid by the insurer for each separate insurance event within insurance period according to insurance agreement.

Insurer’s Rating

Ranking of insurance companies on the basis of the iinsurer’s financial stability, earnings record, creditworthiness, etc.


Mentally and/or physically handicapped and dependent person.


Legal Actions Beyond The Contract
in insurance these are legal actions related to third parties’ liability.

Legal (Registered) Address
Legal address is used for official purposes such as for serving a notice or for tax reporting. A legal address is used to determine one’s state of legal residence and the state laws to calculate tax. A legal address may include a property’s lot number, block number or district number.

Legal Entity
Partnership, corporation, or other organization having the capacity to negotiate contracts, assume financial obligations, and pay off debts. In contrast with natural persons, legal entities are chartered by the states where they are organized. A corporation is a person in the eyes of the law, and it is responsible for its actions. It can be sued if it fails to live up to an agreement.

Legal Name
The legal name of a business is the name under which the business conducts its operations. To be approved as an acceptable name, it must be distinct from other company names and should not be misleading, offensive, or otherwise illegal. Corporate legislation requires that a company name includes appropriate suffixes (such as corporation, incorporated, limited, private limited, public limited, etc., or their abbreviations) so that the entities dealing with the company know its legal status. All legal rights and obligations (such as to own property, to sue and be sued) accrue to a firm under its name which may be also be registered as a trademark or servicemark, and may be changed only by a special resolution (requiring three-quarters of the votes) of its stockholders (shareholders). Called also corporate name.

Any legally enforceable obligation. Within the context of insurance, the obligation to pay a monetary award for injury or damage caused by one's negligent or statutorily prohibited action.

Liability Insurance
Insurance paying or rendering service on behalf of an insured for loss arising out of legal liability to others (see also Civil Liability and Civil liability insurance).

Liability Limits
The stipulated sum or sums beyond which an insurance company is not liable for payments due to a third party. The insured remains legally liable above the limits.

License for performing insurance activity – document of due form issued by the State Insurance Supervision under the Ministry of Finance of the Republic of Uzbekistan certifying the right of its owner for insurance activity by types of insurance stated therein.

Life Insurance
Insurance cover that serves two major purposes: (1) to substitute for the insured's income if he or she dies, and (2) to qualify the insured for favorable tax treatment. The policy holders buy insurance cover from an insurance company, and pay specific periodic amounts (premiums) for the term (duration or life) of the policy. If the insured dies before the this term is completed, a guaranteed sum (the face amount of the policy) is paid to one or more named beneficiaries. If the insured survives the term then, depending on the type of the policy, he or she may receive the full or a part of the face amount of the policy. For young families, a life insurance policy creates an 'instant estate' before they have enough time to accumulate other assets. And it provides liquidity to the named beneficiary (or beneficiaries) long before the deceased's estate matters (which often call for substantial expense) are settled. Four main types of life insurance policies are (1) Term life insurance, (2) Whole life insurance, (3) Endowment life policy, and (4) Annuity. Life insurance has its origins in the old practice of saving money for one's own funeral costs, and is called also life assurance.

Limitations Of Vital Functions
abnormality due to health problems. Characterized by a limited ability to exercise self-care, mobility, orientation, communication, control of own behavior, study and work.

Limited Liability Insurance
Provides for compensation of damage as difference between an agreed limit and the achieved level of income. If as a result of insurance event the insured’s income level was below the limit set the difference between the limit and actually earned income is to be reimbursed.

Limit Of Indemnity
See Sum insured

Lloyd's of London
An association of independent underwriters operating in England. It is not an insurance company; rather, it operates as a marketplace for large and/or unusual insurance exposures where brokers representing insurance applicants are able to contract with underwriters offering coverage.

(1) The basis of a claim for damages under the terms of a policy. (2) Loss of assets resulting from a pure risk. Broadly categorized, the types of losses of concern to risk managers include personnel loss, property loss, time element loss, and legal liability loss. A word often used in place of the word "claim." It refers to the amount an insurer must pay because one of the possibilities of loss insured against under a policy, has happened. (See also Declared loss and Cash loss).

Loss Event
An event that results in an insured loss. In some lines of business, such as liability, an occurrence is distinguished from accident in that the loss doesn't have to be sudden and fortuitous and can result from continuous or repeated exposure which results in bodily injury or property damage neither expected not intended by the insured.

Loss Frequency
the total amount of times that a loss occurs in a particular time frame (usually, one year).

Loss Ratio
Proportionate relationship of incurred losses to earned premiums expressed as a percentage.

Lump-Sum System
when insuring the driver and passengers of land transport, the policy separately stipulates for the total sum insured for all passengers in land transport along with establishing insurer’s limits of liability for one injured.


Marine Hull Insurance
Marine insurance covering damage sustained to an insured vessel.

Marine Insurance
A type of insurance designed to provide coverage for the transportation of goods either on the ocean or by land as well as damage to the waterborne instrument of conveyance and to the liability for third parties arising out of the process. The two branches of marine insurance are ocean marine (primarily water-based exposures) and inland marine (primarily land-based exposures).

A legal agreement that conveys the conditional right of ownership on an asset or property by its owner (the mortgagor) to a lender (the mortgagee) as security for a loan. The lender's security interest is recorded in the register of title documents to make it public information, and is voided when the loan is repaid in full.

Motor Civil liability
see Vehicle Owners Civil Liability

Motor Hull Insurance
Insurance of vehicle against “Hijacking” and “Damage” risks.

Multiple Car Discount
Discount to be provided in case of insurance of several automobiles.

Mutual Insurance
a form of insurance in which the policyholder is simultaneously the insurer.


Natural Loss
deficit of cargo weight arising as a result of natural intrinsic properties of the goods: shrinkage, spillage, leakage, and the like. The loss in cargo weight caused by its natural properties is usually excluded from standard insurance terms but is covered by insurance according to “from any cause whatsoever” clause.

failure to exercise the degree of care considered reasonable under the circumstances. Most policies in property insurance have exclusions referring to loss due to insured’s negligence.

Net Premium
The amount of premium minus the agent's commission. Also, the premium necessary to cover only anticipated losses, before loading to cover other expenses.

Non-Profit Policies
Policies where policyholders are not to participate in the profits derived from life insurance.

Non-State Pension
regular cash payment to the citizen from private pension funds. As a rule, it is complementary to the state pension.


Object Of Insurance
Property interests that do not contradict the legislation of Uzbekistan: The interests that are connected with life, health, ability to work – in personal insurance; related to the possession, use and disposal of property – in property insurance; - related to compensation for damage caused by the insured to personality or property of individual or entity - in liability insurance.

An occurrence that may or may not become a claim. Some claims-made coverages allow for reporting of events.

Other Health Disorder
a) injuries from burns, explosions, lightning, or exposure to an electric current;
b) chemical poisoning (industrial or domestic) and / or burns caused by inhalation or contact with toxic and / or burning substances, vapors or gases;
c) frostbite, drowning, attack intruders or animals, sun stroke, accidental release into the airway foreign body, accidental acute poisoning with poisonous plants, as well as injuries sustained when the vehicle (car, train, tram, etc.), or if they crash while using the machines, mechanisms and tools of all kinds.

Outstanding Loss
Losses that have been reported to the insurer but are still in the process of settlement.

Owners And Contractors Protective (Ocp) Liability Coverage
A stand-alone policy that covers the named insured's liability for bodily injury (BI) and property damage (PD) caused, in whole or in part, by an independent contractor's work for the insured. The contractor purchases the policy to provide coverage for vicarious liability the client (project owner) incurs as a result of the contractor's acts or omissions on the project. The OCP policy also responds to liability arising out of the insured's own acts or omissions in connection with its general supervision of the contractor's operations.


Partial Loss
a loss that does not completely destroy or render useless the insured property or does not completely exhaust the applicable insurance limit.

Particular Average
A partial loss which is caused by an insured peril and which is not a general average loss. The term partial loss may be used instead.

Payment Period
the date when the insurer must make payments in life insurance policy or cumulative insurance policy. Payment period under the life insurance policy comes with the death of the insured. Payment period under cumulative insurance policy comes either after the death of the insured or at the end of a specified period, whichever is the first.

An arrangement in which employees are provided with an income during retirement, usually in the form of monthly payments once they are no longer working. Most often, pensions are funded during a person's working years by means of joint contributions from both workers and their employers. Pensions are operated by private employers or by government (i.e., federal, state, or local) employers (see also Annuity).

Pension Fund
Pooled-contributions from pension plans set up by employers, unions, or other organizations to provide for the employees' or members' retirement benefits. Pension funds are the largest investment blocks in most countries and dominate the stock markets where they invest. When managed by professional fund managers, they constitute the institutional investor category with insurance companies and investment trusts. Commonly, pension funds are exempt from capital gains tax and the earnings on their investment portfolios are either tax deferred or tax exempt.

Pension Policy
in some countries, the document which is the basis for payment of pension monies from the trust fund in case of policyholders retirement.

Probable cause (such as an earthquake, fire, theft) that exposes a person or property to the risk of damage, injury, or loss, and against which an insurance cover (policy) is purchased.

Periodic Insurance Payment
see Annuity

Personal Injury
Bodily injury or death as a result of accident

In broad terms, the entire printed insurance contract. Generally, an insurance policy is assembled with a combination of various standard forms, including a declarations page, coverage form, and endorsements. Sometimes a causes of loss form is also required. Together these forms delineate the coverage term, the insurance policy limits, the grant of coverage, exclusions and other limitations of coverage, and the duties and responsibilities of the insured in the event of a loss.

Policy Conditions
The section of an insurance policy that identifies general requirements of an insured and the insurer on matters such as loss reporting and settlement, property valuation, other insurance, subrogation rights, and cancellation and nonrenewal. The policy conditions are usually stipulated in the coverage form of the insurance policy.

Person in actual possession of insurance policy; policy owner.

Policy Loan
A loan from the insurer to a life insurance policy owner using the cash value as security for the loan.

Policy Period
The term of duration of the policy. The policy period encompasses the time between the exact hour and date of policy inception and the hour and date of expiration.

Political Risk Insurance
Specialized insurance for companies doing business or conducting operations in foreign countries. The insurance addresses the business exposures to loss faced by these companies as a result of governmental action either foreign or domestic. Types of exposures that can be covered under political risk policies include confiscation, expropriation, deprivation, nationalization, political violence, currency inconvertibility, contract frustration, and export credit.

(1) A group of insurers or reinsurers through which particular types of risks (often of a substandard nature) are underwritten, with premiums, losses, and expenses shared in agreed ratios. (2) A group of organizations that form a shared risk pool. Pooling is an attractive alternative for insureds that are not large enough to legally or feasibly self-insure but that desire more control over their loss exposures as well as an opportunity to reduce their cost of risk, compared to a program written by a commercial insurer.

Power Of Attorney
Written legal authority given by one party (the principal) to another (the agent or attorney-in-fact) to act on the principal's behalf. It may be a (1) General power Of attorney that authorizes the agent to act generally on behalf of the principal, or (2) Special power of attorney that is limited to a specific act or situation. Decisions made and actions taken by an attorney in fact (within the scope of his or her authority) are legally binding on the principal. A power of attorney can remain in force only so long as the principal is alive and does not become disabled or incapacitated. Although it is often conferred on the principal's attorney, one does not need to be an attorney at law to be an attorney-in-fact.

Price Forming Documents (In Auto Insurance Policy)
invoice, receipt voucher, purchase agreement, customs declaration, payment order, etc.

Product Liability Insurance
Protection against financial loss arising out of the legal liability incurred by an insured because of injury or damage resulting from the use of a covered product or out of the liability incurred by a contractor after a job is completed (completed operations cover).

Professional Liability Insurance
Coverage designed to protect traditional professionals (e.g., physicians) and quasi professionals (e.g., real estate brokers) against liability incurred as a result of errors and omissions in performing professional services. Although there are a few exceptions, most professional liability policies cover economic losses suffered by third parties, as opposed to bodily injury (BI) and property damage (PD), which is typically covered under commercial general liability (CGL) policies. The vast majority of professional liability policies are written with claims-made coverage triggers.

Profit Commission
A provision found in some reinsurance agreements which provides for profit sharing. Parties agree to a formula for calculating profit, an allowance for the reinsurer’s expenses, and the cedant’s share of such profit after expenses.

Project Management Protective Liability (Pmpl) Insurance
Provided by endorsement to the owners and contractors protective (OCP) liability insurance policy, this coverage simultaneously insures the vicarious liability of a construction project owner, primary architect or engineer, and general contractor as co-named insureds.

Property Damage
Physical injury to tangible property including resulting loss of use and loss of use of tangible property that has not been physically injured.

Property Insurance
First-party insurance that indemnifies the owner or user of property for its loss, or the loss of its income-producing ability, when the loss or damage is caused by a covered peril, such as fire or explosion. In this sense, property insurance encompasses inland marine, boiler and machinery (BM), and crime insurance, as well as what was once known as fire insurance, now simply called property insurance: insurance on buildings and their contents.

Proportional Liability System
Refers to an arrangement for the assignment of liability in which each member of a group is held responsible for the financial results of the group in proportion to its participation.

A statement of the premium that an underwriter requires to underwrite an insurance/ reinsurance risk based on the information supplied by the person seeking cover, either directly or via their broker. A quotation may be conditional, eg it may be subject to the provision of further information, or not. If a quotation is accepted before it is withdrawn, then subject to the satisfaction of any conditions that may attach to the quotation, an insurance/reinsurance contract will be made.

Real Property
Land and most things attached to the land, such as buildings and vegetation. Growing crops, since they are physically attached to the soil, are generally considered real property. The definition of "land" includes not only the surface of the earth, but also everything above and beneath it. Thus, the ownership of a tract of land theoretically includes both the airspace above it and the soil from its surface to the center of the earth.

Reinsurance is the transfer of some or all of an insurance risk from one insurer to another insurer.
The assuming insurer (reinsurer) agrees, in consideration of premium paid, to indemnify the ceding
company (reinsured) against all or part of the loss which the ceding company may sustain under the
policy (or policies) it has issued.
The purpose of reinsurance is to limit an insurance company’s exposure to claims which could arise
on policies which they have issued. The benefits of Reinsurance are that it increases capacity,
stabilizes underwriting results and secures protection against large and costly catastrophic losses.

Reinsurance Agreement
Agreement by which one insurance company transfers risk to another (buys reinsurance). Unlike an insurance policy, both parties sign a reinsurance agreement.

Reinsurance Pool
This is a multireinsurer agreement under which each reinsurer in the group or pool assumes a specified portion of each risk ceded to the pool. Contrast with a reinsurance wheel.

Reinsurance Premium
The premium paid by the ceding company to the reinsurer in consideration for the liability assumed by the reinsurer.

Reinsurance Recoverable
Amount of an insurer's incurred losses that reinsurers will pay. May require collateralization if the cedent is to record the recoverable as an asset for statutory reporting purposes.

An insurer that contracts with a reinsurer to share all or a portion of its losses under insurance contracts it has issued in return for a stated premium. Also called the "ceding company."

insurance company that assumes all or part of an Insurance or reinsurance policy written by a primary insurance company.

Bringing back to one's homeland, generally referring to transportation of an injured or ill employee back to his or her home country. This coverage is sometimes added to the workers compensation policy by a manuscript foreign voluntary compensation endorsement.

A transaction in which a reinsurer transfers risks it has reinsured to another reinsurer.

A reinsurer of a reinsurer.

Risk Allocation
Allocation of proportional risk to all parties to a contract, usually through a risk premium.

Risk Assessment
The identification, evaluation, and estimation of the levels of risks involved in a situation, their comparison against benchmarks or standards, and determination of an acceptable level of risk.

Ritorno/Short-Rate Cancellation
A financial penalty incurred when the insured cancels an insurance contract prior to the expiration date of the contract. The insurer keeps a percentage of unearned premium (UEP) to cover costs.

The taking of another's property by force or threat of force.

Rules Of Insurance Reserves Allocation
order determined by the state body according to which available funds of insurance reserves are used by insurers to invest in various financial instruments.


Penalty or punitive action imposed for failure to comply with a court order, law, or regulation.

Scope Of Insurance
List of perils against which insurance is provided according to insurance contract.

A system whereby a firm sets aside an amount of its monies to provide for any losses that occur—losses that could ordinarily be covered under an insurance program. The monies that would normally be used for premium payments are added to this special fund for payment of losses incurred. Self-insurance is a means of capturing the cash flow benefits of unpaid loss reserves and offers the possibility of reducing expenses typically incorporated within a traditional insurance program. It involves a formal decision to retain risk rather than insure it and is distinguished from noninsurance or retention of risks through deductibles by a formalized plan or system to pay losses as they occur.

Insurer’s (reinsurer’s) share of participation in insurance (reinsurance) of certain object.

Schengen Group
Association of states in Europe that in theory adhere to the ideals of the Schengen Convention, notably the abolition of passport controls at common internal borders and the strengthening of external borders. Schengen Group countries include Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Lithuania, Luxemburg, Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, Switzerland.

Single Insurance Payment
the amount of insurance compensation to be paid by the insurer as a lump sum payment for compensation of damage.

Social Insufficiency
social consequences of health disorder leading to the limitation of vital functions and need for social protection.

Source Of High Danger
activities related to the operation of certain facilities specific properties of which create increased injury probability to others.

State Insurance
Insurance where insured is the state organization.

Statement Of Claim
A written statement by a plaintiff detailing the facts which support the claim against the defendant and the relief sought.

State Pension
regular cash payment to the citizen from the state social security funds.

The assignment to an insurer by terms of the policy or by law, after payment of a loss, of the rights of the insured to recover the amount of the loss from one legally liable for it.

Sum Insured
Maximum amount that an insurance company will pay under an insurance contract.

Surrender Clause
Clause in insurance or reinsurance agreement stipulating for notifying period regarding cancellation of a policy before its normal expiry by mutual consent of insured and insurer.

One who determines either the condition of insured marine property or the amount of loss or damage in ocean marine practice.

Surveyor’s Activities
activities associated with determining value of various property types.

A group of companies or underwriters who join together to insure very high-valued property or high-hazard liability exposures. Insurance exchanges, such as Lloyd's of London, use syndicates to write insurance.


Technical Risks Insurance
type of property insurance which includes: construction risks insurance, machinery breakdowns insurance, warranty period insurance, electronic equipment insurance and owners and contractors protective liability insurance.

Technical Reserves
Technical reserves are the amounts insurance companies set aside from profits to cover claims. Technical reserves include the unearned premium reserve and the outstanding claims reserve. The latter is the amount of premium written but not earned. Technical reserves may also include the unexpired risk reserve and the claims equalisation reserve if such reserves have been created.

Temporary Total Disability
One of the four divisions of disability compensable under workers compensation. This level of disability reflects an injury that has rendered the employee completely unable to perform any job functions on a temporary basis. The employee is expected to make a full recovery and return to work. In the interim, compensation paid is usually a percentage of weekly wages until the worker returns to the job.

Sealed bid or offer document submitted in response to a request for tenders and containing detailed information on requirements and terms associated with a potential contract. See also tender offer.

the generic term for all crimes in which a person intentionally and fraudulently takes personal property of another without permission or consent and with the intent to convert it to the taker's use (including potential sale). Although robbery (taking by force), burglary (taken by entering unlawfully), and embezzlement (stealing from an employer) are all commonly thought of as theft, they are distinguished by the means and methods used, and are separately designated as those types of crimes in criminal charges and statutory punishments.

Theft Insurance
this type of policy covers theft at a private residence. This type of coverage usually protects against all perils such as vandalism, theft, and damages occurring due to malicious mischief.

Third Party
Someone other than the insured and the insurer. In liability insurance, the insurer provides defense against claims or suits brought by third parties—hence the term "third-party insurance."

The right to ownership of property. The owner of real property having just possession of his property.

Title Insurance
Insurance that indemnifies the owner of real estate in the event that his or her clear ownership of property is challenged by the discovery of faults in the title.

Total Loss
A loss of sufficient size that it can be said no value is left. The complete destruction of the property. The term also is used to mean a loss requiring the maximum amount a policy will pay.

Transportation Insurance
A policy that covers the insured's property while in transit. All modes of transport required to move the property from one location to the other are covered (see Aviation Insurance, Marine Insurance, Automobile Physical Damage Insurance, Marine Hull Insurance).


Depending on the context this term may refer to: (a) the individual who is responsible for underwriting a particular insurance or reinsurance contract and who is either an employee of a managing agent, an insurance company or reinsurance company or an employee of a coverholder or any similar underwriting agent. (b) an individual member or company that insures or reinsures a risk. Underwriter looks at an insurance application and decides whether or not the insurance company can or should provide the applicant with insurance, based on the risk that person presents and determines the amount, price, and conditions under which the submission is acceptable.

The process of determining whether to accept a risk and, if so, what amount of insurance the company will write on the acceptable risk, and at what rate. Underwriters are companies, individuals, or insurance companies that carry on this critical activity for their own account or for that of others.

Uninsurable Perils
These are events or situations for which insurance coverage cannot be purchased. The damage as a result of these incidents is usually predictable or preventable. For example, if you build your house on a flood plain, your house will, at some point, be flooded. Flooding, in this case, is an uninsurable peril.

Unit Of The Sum Insured
quantitatively expressed part of the sum insured, serves as the basis for setting tariffs and calculating insurance premium in respect to insurance agreements. As a rule, the unit of the sum insured is about 100 or 1000 national currency units.

Urgent Care
the delivery of ambulatory care in a facility dedicated to the delivery of medical care outside of a hospital emergency department, usually on an unscheduled, walk-in basis. Urgent care centers are primarily used to treat patients who have an injury or illness that requires immediate care but is not serious enough to warrant a visit to an emergency department.


Vehicle Owners’ Civil Liability, Motor Liability
Liability of person for casing damage to third parties (their life, health, property) as a result of the traffic accident. The offender must pay off the losses to the victims. Motor liability is object of insurance where the obligation to indemnity lies on the insurer. When insuring civil liability, the insurer pays to third party (or reimburse the insured) the amount which the policyholder must pay (or has paid) to third parties for damage caused by vehicle: death, injury or other damage to health, destruction or damage to property.

Voluntary Insurance
Type of insurance performed on voluntary basis, in contrast to compulsory insurance when the insured, according to the legislation, is obliged to conclude insurance agreement to insure its property or third party liability.

Workers Compensation And Employers’ Liability Insurance
An insurance policy that provides coverage for an employer's two key exposures arising out of injuries sustained by employees. Part One of the policy covers the employer's statutory liabilities under workers compensation laws, and Part Two of the policy covers liability arising out of employees' work-related injuries that do not fall under the workers compensation statute.