Bailee:
One who has temporary possession of property belonging to
another.
Balance Sheet:
Provides a snapshot of a company’s financial condition
at one point in time. It shows assets, including investments
and reinsurance, and liabilities, such as loss reserves to
pay claims in the future, as of a certain date. It also states
a company’s equity, known as policyholder surplus. Changes
in that surplus are one indicator of an insurer’s financial
standing.
Basic Form:
A package insurance policy providing coverage against a limited
number of specified perils.
Beach and Windstorm Plans:
State-sponsored insurance pools that sell property coverage
for the peril of windstorm to people unable to buy it in the
voluntary market because of their high exposure to risk. Seven
states (AL, FL, LA, MS, NC, SC, TX) offer these plans to cover
residential and commercial properties against hurricanes and
other windstorms. Georgia and New York provide this kind of
coverage for windstorm and hail in certain coastal communities
through other property pools. Insurance companies that sell
property insurance in the state are required to participate
in these plans. Insurers share in profits and losses. (See
Fair Access to Insurance
Requirements Plan–FAIR Plan;
Residual Market.)
Beneficiary:
Any person, institution, trust, etc., named in a life policy
to receive the policy benefits upon the death of the insured.
Binder:
A written or oral contract issued temporarily to place insurance
in force immediately prior to issuance of a new policy or
endorsement of an existing one. A binder is subject to payment
of the premium and provides coverage under the terms of the
policy to be issued, unless otherwise specified.
Blanket Coverage:
A blanket form is one under which property is insured under
a single amount applying to several different pieces of property
rather than a specific amount of insurance on each property.
Block Policy:
An inland marine policy covering all property on or off a
merchant’s premises, including property of others in
the care, custody or control of the policyholder.
Bodily Injury Liability Insurance:
This coverage protects an insured against legal liability
for injury to another person arising from an accident.
Boiler and Machinery Insurance:
A form of property coverage for loss arising out of the operation
of pressure, mechanical and electrical equipment. It may cover
loss to the boiler and machinery itself and business interruption
losses.
Bond:
A security that obligates the issuer to pay interest at specified
intervals and to repay the principal amount of the loan at
maturity. In insurance, a form of suretyship. Bonds of various
types guarantee a payment or a reimbursement for financial
losses resulting from dishonesty, failure to perform and other
acts.
Bond Rating:
An evaluation of a bond’s financial strength, conducted
by such major ratings agencies as Standard & Poor’s
and Moody’s Investors Service.
Book of Business:
Total amount of insurance on an insurer’s books at
a particular point in time.
Broad Form:
A package policy providing coverage for the same perils covered
in the basic form, plus specified additional perils.
Broker:
A representative of the buyer of property and liability insurance
who deals with either agents or companies in arranging for
the coverage required by the customer. A broker is paid a
commission by the company or its agent.
Burglary:
The loss of property due to theft when there is visible evidence
of forcible entry to the exterior of the building.
Burglary and Theft Insurance:
Insurance for the loss of property due to burglary, robbery
or larceny. It is provided in a standard homeowners policy
and in a business multiple peril policy.
Business Income Insurance (Business Interruption Insurance):
Commercial coverage that reimburses a business owner for lost
profits and continuing fixed expenses during the time that
a business must stay closed while the premises are being restored
because of physical damage from a covered peril, such as a
fire. Business interruption insurance also may cover financial
losses that may occur if civil authorities limit access to
an area after a disaster and their actions prevent customers
from reaching the business premises. Depending on the policy,
civil authorities coverage may start after a waiting period
and last for two or more weeks.
Businessowners Policy (BOP):
A policy that combines property, liability and business interruption
coverages for small- to medium-sized businesses. Coverage
is generally cheaper than if purchased through separate insurance
policies.
Business Interruption Insurance:
See Business Income Insurance.
Buy-Out Policy:
A professional liability policy covering future claims resulting
from incidents which occurred during the period that an expired
claims-made policy was in force. |
