Does My Insurance Company Have To Defend Me?

Accident insurance — Insurance that compensates for losses resulting from bodily injury. Losses may include expenses, suffering or death.

All-risk insurance — Insurance that compensates for all insurable losses except losses explicitly excluded.

Assessable insurance — Insurance in which the insured is required to pay additional premiums for an unusually large loss.

Assigned risk — A person who is a poor risk for insurance and would not have been insured but for a state law, such as a compulsory motor-vehicle-insurance statute, requiring an insurance company provide coverage.

Bad faith — An insurance company's unreasonable and unfounded refusal to provide coverage in violation of the duties of good faith and fair dealing owed to an insured.

Casualty insurance — An agreement to indemnify against loss resulting from a broad group of causes such as legal liability, theft, accident, property damage and workers' compensation.

Certificate of insurance — A document acknowledging that an insurance policy has been written and setting forth in general terms what the policy covers.

Coinsurance — Insurance provided jointly by two or more insurers or insurance under which the insurer and insured jointly bear responsibility.

Comprehensive general-liability insurance (CGL) — Insurance that broadly covers an insured's liability exposure, including product liability, contractual liability and premises liability.

Comprehensive insurance — Insurance that combines coverage against many kinds of losses that may also be insured separately. Comprehensive insurance is often used in an automobile-insurance policy.

Compulsory insurance — Statutorily required insurance. For example, motor-vehicle liability insurance that a state requires as a condition to registration of the vehicle.

Convertible insurance — Insurance that can be changed to another form without further evidence of insurability. For example, a term-life-insurance policy that can be changed to permanent insurance without a medical examination.

Double insurance — Insurance coverable by more than one insurer for the same interest and for the same insured.

Excess insurance — An agreement to indemnify against any loss that exceeds the amount of coverage under another policy. Also called excess policy.

Exclusion — An insurance-policy provision that excepts certain events or conditions from coverage.

Expected/intended exclusion — A provision in some commercial general liability policies excluding coverage for property damage or bodily injury that is expected or intended by the insured. Sometimes called "exclusion a" because it is the first exclusion listed on most polices. Also called intentional-injury exclusion.

Extended insurance — Insurance that continues in force beyond the date that the last premium was paid by drawing on its cash value.

Extended-term insurance — Insurance that remains in effect after a default in paying premiums, as long as the policy has cash value to pay premiums.

Failure-to-perform exclusion — A provision in some CGL policies excluding coverage for the loss of use of undamaged property resulting from the insured's delay or failure in performing an obligation or a design defect or failure in the insured's product. Also called loss-of-use exclusion.

First-party insurance — A policy that applies to an insured or the insured's own property such as life insurance, health insurance, disability insurance and fire insurance. Also called indemnity insurance or self-insurance.

Group insurance — A form of insurance offered to a member of a group such as the employees of a business, as long as that person remains a member of the group.

Guaranty insurance — An agreement to cover a loss resulting from another's default, insolvency or specified misconduct.

Indemnity insurance — See first-party insurance.

Limited-policy insurance — Insurance that covers only specified perils. For example, health insurance that covers a specific type of illness or a risk relating to a stated activity such as travel.

Loss insurance — Insurance purchased by a person who may suffer a loss at the hands of another. The converse of liability insurance, which is purchased by potential defendants.

Named-insured exclusion — An exclusion limiting liability-insurance coverage to a named insured whose injuries were caused by another named insured under the same insurance policy.

No-fault auto insurance — An agreement to indemnify for a loss due to personal injury or property damage arising from the use of an automobile, regardless of who caused the accident.

Non-insurable risk — A risk for which insurance will not be written because the risk is too uncertain to be the subject of actuarial analysis.

Occurrence-based liability insurance — Insurance that covers bodily injuries of property damage suffered during the policy period. Each instance of injury or damages in an "occurrence" that may trigger an insured's entitlement to benefits. Also called accident-based insurance.

Primary insurance — Insurance that attaches immediately on the happening of a loss; insurance that is not contingent on the exhaustion of an underlying policy.

Reinsurance — Insurance of all or part of one insurer's risk by a second insurer who accepts the risk in exchange for a percentage of the original premium. Also called reassurance.

Subrogation — The principle under which an insurer that has paid a loss under an insurance policy is entitled to all the rights and remedies belonging to the insured against a third party with respect to any loss covered by the policy.

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