Sistership Exclusion
Definition of "Sistership exclusion"
Part of the business risk exclusion in general liability insurance that denies coverage for subsequent claims if a defective product is not recalled by an insured. For example, if a consumer filed a damage suit against XYZ Co. claiming that he or she became sick while eating a can of soup from a particular lot that was contaminated, the insurer would not pay later claims filed by other consumers if the XYZ Co. did not recall that lot of the soup. The general liability insurance policy for businesses also excludes costs associated with the withdrawal of a product from the market whether it is ordered by a government agency or by company management. A business that wants coverage for product recall would need to buy product recall insurance to include the extra wages and other costs of identifying the faulty product, notifying consumers, correcting or repairing the product, and redistributing it.
Popular Insurance Terms
Measurement of the amount of capital (assets minus liabilities) an insurance company has as a basis of support for the degree of risk associated with its company operations and investments. ...
Endorsement to a business property floater policy that covers neon signs for all perils, both while they are being moved and once they are in place. Signs that are attached to a building ...
Model act written and published by the national association of insurance commissioners (naic) whose purpose it is to regulate brokers who control insurance companies. The act permits the ...
Government group that provides reinsurance for private insurers that write riot and civil commotion insurance. Riot losses in major cities in the 1960s caused insurers to stop writing this ...
Important quantitative measure for an insurance company indicating the percentage of each premium dollar that is going to pay for losses. Based on losses incurred, appropriate reserves are ...
Vehicle for the deferring of unneeded current income for a later date, such as retirement, providing the following benefits: There is no tax on earnings of the plan until distributed; ...
Retirement plan in which money is currently allocated to fund an employees' pension. ...
Benefits payable under any insurance policy or annuity contract. ...
Percentage of a life insurance company's policies in force at the beginning of the year that are no longer in force at the end of the year. This ratio is critical because it indicates the ...
Have a question or comment?
We're here to help.