INN's Insurance Glossary
September 21, 2011 12:00 AM
Viator
The terminally ill person who sells his or her life insurance policy to an insurance firm, which purchases the policy at a steep discount, and in turn, provides early payouts, assumes premium payments and collects the policy's face value upon the policyholders death. (According to A.M. Best and I.I.I.)
Pooling
Method by which each member of an insurance pool shares in each and every risk written by the other members of the pool. (According to the NAIC)
Off-Balance Sheet Risk
A measure of risk due to excessive rates of growth, contingent liabilities or other items not reflected on the balance sheet. (According to the NAIC)
Limnic Eruption
A sudden release of asphyxiating or inflammable gas from a lake. (According to the NAIC)
Laddering
A technique that consists of staggering the maturity dates and the mix of different types of bonds. (According to the I.I.I.)
Irrevocable Beneficiary
A life insurance policy beneficiary with a vested interest in the policy proceeds, even during the insureds lifetime, because the policyholder has the right to change the beneficiary designation only after obtaining the beneficiarys consent. (According to the NAIC)
Free Look Provision
An individual life insurance and annuity provision that gives the policyholder a stated time, usually 10 days after the policy is delivered, in which to cancel the policy and receive a full refund on the initial premium payment. (According to the NAIC)
Catex
An exchange through which insurers trade "standardized catastrophe units." (According to the NAIC)
BCEGS (Building Code Effectiveness Grading Schedule)
A classification of communities by the Insurance Services Office based on how well they have implemented and enforced building codes in their community. (According to the NAIC)
Antiselection
The tendency of individuals who believe they have a greater-than-average likelihood of loss to seek insurance protection to a greater extent than those who believe they have an average or a less-than-average likelihood of loss. (According to the NAIC)
Insurance Glossary Test
Think you have a lock-down on insurance lingo? Know your limnics and your ladders? Test your knowledge by clicking through and brushing up on your terminology. Special thanks to the National Association of Insurance Commissioners (NAIC), the Insurance Information Institute (I.I.I.) and A.M. Best for the definitions.