Finite Risk Insurance
Type of insurance that provides a single aggregate limit of coverage within the insurance policy terms, thereby limiting the insurance company's liability for a risk transferred to it. The insurance coverage is tailored to the requirements of the insured company to reflect the insured's actual coverage needs. If the insured's losses are favorable, the insured receives the return of a portion of the premium paid. The insured's premium costs are based on the insured's own loss experience, rather than the overall loss experience of a pool of similar insureds. In essence, through this type of insurance, the insured pays for exposure to loss and if there is not a substantial loss, the insured receives the return of a portion of the premium paid in. This insurance mechanism is ideal for insureds who exhibit a frequency distribution of high severity loss or an unusual loss frequency.
Popular Insurance Terms
Quality of being useful. Risk diminishes maximum utility in society because resources gravitate to activities, businesses, and investments that are least risky. By absorbing or protecting ...
In property insurance policies, a clause that requires mat a particular insured property be a specified distance from like insured or noninsured property. For example, stored dynamite ...
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Maintenance of Social Security benefits at current dollar or percentage levels. Social Security benefits are indexed to the Consumer Price Index and rise in tandem with the Index. A benefit ...
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Series of premium payments made to purchase an annuity. This is the same method of purchase used for level premium insurance ...
Coverage on an all risks basis for glass breakage, subject to exclusions of war and fire. Thus, if a vandal throws a brick through a window of an insured's establishment, the coverage would ...
Premium charge for a policy that is going to be in force for less than the normal period of time. ...
Sum of money to be received by an insured in the event a given loss occurs. ...
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