Ch3 Property and Liability Insurance Principles

Created by JDeHaro 

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Familiar Terms

Paid Loss

A claim payment that an insurer has made

Incurred losses

The sum of paid losses and changes in loss reserves for a particular period

Loss Reserves

Amounts designated by insurers to pay claims for losses that have already occurred but are not yet settled

Net investment gain or loss

An isnurer's gains or losses from the sale of invested assets plus net investment income.

Net underwriting gain or loss

An insurer's earned premiums minus its losses and underwriting expenses for a specific period

Overall gain or loss from operations

net investment gain or loss plus net underwriting gain or loss

Assets

Types of property, both tangilble and intangible, owned by an entity

Admitted assets

Types of property, such as cash and stocks, that regulators allow insurers to show as assets on their financial statements.

Nonadmitted assets

Types of property, such as office furniture and equipment, that regulators do not allow insurers to show as assets on financial statements because these assets cannot readily be converted to cash at or near their market value

Liabilities

Finanical obligations, or debts, owed by a company to another entity, usually the policyholder the case of an insurer.

Loss Reserve

The amount estimated and set aside by insurers to pay claims for losses that have already occurred but are not yet settled.

Unearned premium reserve

The total of an insurer's unearned premiums on all policies at a particular time

Policyholders' surplus

An insurer's total admitted assets minus it's total liabilities

Balance sheet

A finanical statemetn that shows a company's financial

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