ACCIDENT: An event causing loss, which occurs without being expected or designed, usually specific in time and place. ACCELERATED DEATH BENEFITS: A provision that will pay all or part of the policy death benefits while the policyholder is still alive. Conditions include proof that the policyholder is terminally ill with a life expectancy of less than 12 months, has a specified life-threatening disease or is in a long-term care facility such as a nursing home. By accepting an accelerated benefit payment, a person could be ruled ineligible for Medicaid or other government benefits. The proceeds may also be taxable. ACCIDENTAL DEATH BENEFIT: Provision for payment of an additional amount– usually equal to the face amount of insurance – if the insured is killed in an accident. Popularly known as double indemnity. ACQUISITION COSTS:Expenses incurred in acquiring new business premiums and conservation of renewal business. Broad in scope, it includes cost of soliciting business, issuance of policies, collection of premiums, agents’ compensation, field supervision, advertising, and any other expense reasonably attributable to acquisition and conservation of written premiums. ACTUAL CASH VALUE (ACV): The cost of replacing or restoring property at prices prevailing at the time and place of the loss, less depreciation, however caused. Another definition: the sum of money required to replace property less depreciation, which includes physical wear and tear, and obsolescence. ACTUARY: A person whose principal function is to make the technical calculations required for the pricing of insurance policies. ADDITIONAL EXTENDED COVERAGE: A second endorsement on the fire policy(fire and lightning with extended coverage) which insures the dwelling and/or contents against water damage from plumbing, etc.; boiler explosion; glass breakage; and damage by ice and snow, freezing, fall of trees, collapse, vandalism, vehicles owned by insured or tenants and landslide. ADDITIONAL INSURED: One who is protected by an insurance policy other than the named insured. Examples: In automobile insurance, one who drives the insured’s car with his consent ordinarily is protected. In property insurance, this might be a co-owner, mortgagee, or lien holder. ADJUSTER: A person who investigates and settles losses for an insurance carrier or the insured. ADVANCE PREMIUM: Most companies give the insured the right of making premium payments in advance. AGE CHANGE: An age change occurs on the date, halfway between birth dates, on which the life insurance age changes. Immediately after, the premium for new life insurance will be computed to the age on the next following birth date. The life insurance age is the age at nearest birthday. AGE LIMITS: The ages below and above which the company will not accept applicants. AGENCY: An organization which solicits insurance for one or more carriers and may perform other functions such as issuing policies and adjusting losses. AGENT:1. An individual who solicits insurance for one or more carriers and may perform other functions, such as issuing policies. 2. Agents of a direct writer are sales employees of one company only. AGE OF CAR (age group): A term used to classify cars according to age for rating purposes. ALL PHYSICAL LOSS FORM: This coverage protects against loss from “all risks of physical loss” for dwellings subject to certain exclusions contained in the form. ANNUAL POLICY: Insurance policy written for a term of one year. ANNUITY: A contract in which the buyer deposits money with a life insurance company for investment. The contract provides for specific payments to be made at regular intervals for a fixed period or for life. ANNUITANT: The person during whose life an annuity is payable, usually the person to receive the annuity. APPLICATION: A request to a company for a policy. The application is a conditional offer to buy. If the medical examination and the inspection are in order, the company usually will accept the offer. It may be the policy named in the application or, if the applicant is substandard, it may be on a higher premium or other policy form. APPRAISAL: Determination of the value of property or the extent of damage by impartial experts. Many property insurance policies provide for “appraisals” where the company and the insured cannot agree on the amount or the extent of a loss. APPROVED: In fire insurance, usually means that the construction, equipment, preventive and protective devices meet established requirements for insurance. In many cases,”approved” construction results in reduced insurance premiums. AREA: A territorial subdivision, usually called “rating territory,” within a given state used for rating purposes. ARSON: The willful and malicious burning of property, sometimes with the intent of defrauding an insurance company. ASSETS: All of the property owned by a carrier. ASSIGNEE: One to whom the legal ownership of a policy or a limited interest therein is transferred. ASSIGNMENT: The partial or complete transfer by a person of his right or interest in a policy to another person. The ability of a person to so assign the policy may be limited by law or individual circumstances. An assignment must be written, signed by the owner-policyholder whose interest is being transferred, properly attested, and the original or a certified copy must be filed with the insuring company. A valid assignment so filed is binding on the company. ASSURANCE-INSURANCE: These terms are today generally accepted as synonymous, although not originally so. The term “assurance” is used more commonly in Canada and Great Britain than in the United States.