The uncertainty or chance of a loss occurring.

The reduction, decrease, or disappearance of value of the person or property insured in a policy, caused by a named peril.

Eliminating the exposure to a loss

A contract under which one insurance company (the reinsurer) indemnifies another insurance company for all or part of it's liabilities.

Something of value that each party gives to the other

Conditions or situations that increase the probability of an insured loss occurring.

A unit of measurement used to determine rates charged for insurance coverage.

The planned assumption of risk by an insured through the use of deductibles, co-payments, or self-insurance

Type of company owned by the stockholders who provide the capital necessary to establish and operate the insurance company and share in any profit or losses

A provision in an insurance policy that states that in the event of a loss, an insured or a beneficiary is permitted to collect only to the extent of the financial loss, and is not allowed to gain financially because of the existence of an insurance contract.

Causes of loss insured against in an insurance policy.

Situations that can only result in a loss or no change.

The only type of risk insured by insurers

Company owned by Policyowners and issue participating policies (Policies that pay owners dividends)

Principle that implies that there will be no fraud, misrepresentation or concealment between the parties

Type of Hazard arising from the material, structural, or operational features of the risk, apart from the persons owning or managing it.

Applicants that may lie on an application for insurance or have submitted a fraudulent claim against an insurer in the past.

The insuring of risks that are more prone to losses than the average risk

Authority that is not expressed or written into the contract, but which the agent is assumed to have in order to transact business.

A statement that if discovered would alter the underwriting decision of the insurance company (Considered Fraud)

An increase in the hazard presented by a risk, arising from the insured's indifference to loss because of the existence of insurance.

Involves the opportunity for either loss or gain. Ex: Gambling

The larger the number of people with a similar exposure to loss, the more predictable the actual losses will be.

The appearance or assumption of authority based on the actions, words, or deeds of the principle or the circumstances the principle created.

An absolutely true statement upon which the validity of the insurance policy depends