Underwriting Cycle
Tendency of property and liability insurance premiums, insurers' profits, and availability of coverage to rise and fall with some regularity over time. A cycle can be said to begin when insurers tighten their underwriting standards and sharply raise premiums after a period of severe underwriting losses. Stricter standards and higher premium rates often bring dramatic increases in profits, attracting more capital to the insurance industry and raising underwriting capacity. On the other hand, as insurers strive to write more premiums at higher levels of profitability, premium rates may be driven down and underwriting standards relaxed in the competition for new business. Profits may erode and then turn into losses if more tax underwriting standards generate mounting claims. The stage would then be set for the cycle to begin again.
Popular Insurance Terms
Person, business, or organization specified as the insured (s) in a property or liability insurance policy. In some instances, the policy provides broader coverage to persons other than ...
No limitation under a contributory pension plan of an employee's right to receive vested benefits, regardless of whether or not the employer withdraws contributions. ...
Endorsement to a fidelity bond or surety bond to cover losses that occurred after lapse of the discovery period of the previous bond. Coverage is limited to the amount provided by the ...
Death caused by a person without legal justification. Wrongful death may be the result of negligence, such as when a drunken driver hits and kills someone; or it may be intentional, as when ...
Same as term Calendar Year Experience: paid loss experience for the period of time from January 1 to December 31 of a specified year (not necessarily the current year). ...
Arrangement by which an employee can retire and receive full benefits without reduction, or reduced benefits subject to a penalty. These ages can be classified in the following manner: ...
Trust established under the Internal Revenue Service code that is used to provide accident and sickness benefits to member employees. ...
Additions made by Congress in 1978 to the Internal Revenue Code that provide an employee benefit plan under which the employee makes an irrevocable decision to forego a portion of future ...
Insurance company that has no outstanding shares of stock, such as a mutual insurance company. ...
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