This glossary explains acronyms commonly encountered in the Financial Services sector’s Insurance — Property & Casualty Practice, spanning underwriting, claims, actuarial work, regulation, risk engineering, and insurance operations. It helps executives and practitioners interpret specialized terminology used across personal, commercial, and specialty lines.
A B C D E F G H I K L M N O P R S T U V W Y
| A | |
| A&E | Asbestos and Environmental: A category of long-tail liability claims arising from asbestos exposure, pollution, and environmental damage. These claims can develop over decades and materially affect casualty reserves. |
| A&O | Adjusting and Other Expenses: A statutory expense category covering claim-adjustment costs that cannot readily be assigned to a specific claim, such as claims-department overhead and certain investigative expenses. |
| AAIS | American Association of Insurance Services: An advisory organization that develops policy forms, rating information, and data standards used by property and casualty insurers. |
| AAL | Average Annual Loss: The modeled long-term average of catastrophe losses across all simulated years. Insurers use it in pricing, portfolio management, capital planning, and catastrophe-risk assessment. |
| ACORD | Association for Cooperative Operations Research and Development: A standards-setting organization whose forms and electronic data standards support insurance applications, certificates, policy transactions, and information exchange. |
| ACV | Actual Cash Value: A property-loss valuation generally based on replacement cost less depreciation, subject to policy language and applicable law. It can determine the initial or final amount payable for damaged property. |
| AEP | Aggregate Exceedance Probability: The probability that total losses from all events in a year will exceed a specified amount. It is used to assess aggregate catastrophe exposure and annual earnings volatility. |
| AI | Additional Insured: A person or organization added to another party’s liability policy for specified activities or relationships. The endorsement’s wording determines the scope and priority of protection. |
| ALAE | Allocated Loss Adjustment Expense: Claim-handling expense attributable to a specific claim, such as defense counsel, experts, or independent adjusters. It is tracked for reserving, claim-cost analysis, and profitability measurement. |
| ALE | Additional Living Expense: Homeowners coverage for the necessary increase in living costs when a covered loss makes the insured residence uninhabitable, subject to policy limits and time restrictions. |
| ALOP | Advance Loss of Profits: Construction-project coverage for income loss and specified continuing expenses when insured physical damage delays commercial operations. It is closely related to delay-in-start-up coverage. |
| AOB | Assignment of Benefits: A transfer of policy benefits or claim-payment rights from an insured to a service provider or another party. Its validity and permissible scope vary by policy language and jurisdiction. |
| AOP | All Other Perils: A catastrophe-modeling and property-insurance category for covered causes of loss other than separately identified catastrophe perils such as windstorm or earthquake. |
| APD | Auto Physical Damage: Coverage for collision and other covered damage to an insured vehicle. Commercial insurers also use the term when segmenting vehicle claims and underwriting fleet exposures. |
| ASC 944 | Accounting Standards Codification Topic 944, Financial Services—Insurance: The principal U.S. GAAP guidance addressing insurance-specific accounting matters, including premiums, claim liabilities, acquisition costs, and financial disclosures. |
| ASOP | Actuarial Standard of Practice: Professional guidance governing actuarial work in areas such as ratemaking, loss reserving, catastrophe modeling, and risk evaluation. Applicable standards help define acceptable actuarial practice in the United States. |
| AWW | Average Weekly Wage: A workers’ compensation measure used to calculate wage-replacement benefits. The applicable formula and maximum benefit vary by jurisdiction. |
| AY | Accident Year: A method of grouping claims by the year in which the insured event occurred, regardless of when the policy was written or the claim was reported. It is fundamental to loss-development analysis. |
| B | |
| B&M | Boiler and Machinery: The traditional name for coverage now commonly called equipment breakdown insurance. It addresses certain accidental mechanical, electrical, and pressure-system failures that standard property policies may exclude. |
| BCAR | Best’s Capital Adequacy Ratio: A.M. Best’s proprietary model for evaluating an insurer’s risk-adjusted capitalization across underwriting, investment, credit, and catastrophe risks. |
| BCEGS | Building Code Effectiveness Grading Schedule: A community classification system that assesses building-code adoption and enforcement. Property insurers may use the grade in risk selection and rating. |
| BEL | Best Estimate Liability: The probability-weighted present value of expected future insurance cash flows without an added prudence margin. It is an important component of several international solvency and financial-reporting frameworks. |
| BF | Bornhuetter–Ferguson: An actuarial reserving method that combines an a priori expected loss estimate with observed claim emergence. It is especially useful when reported or paid losses remain immature. |
| BI | Bodily Injury: Physical injury, sickness, disease, or death for which liability coverage may respond. It is a core exposure and coverage component in automobile and general liability insurance. |
| BI | Business Interruption: Coverage for lost income and specified continuing expenses when insured physical damage disrupts operations. Policy wording may refer to this protection as business income coverage. |
| BOP | Businessowners Policy: A packaged policy combining property, business income, and general liability coverages for eligible small and midsize businesses. |
| BPP | Business Personal Property: Commercial property such as furniture, equipment, inventory, and certain improvements that is not classified as real property. Valuation and location provisions materially affect coverage. |
| C | |
| CAS | Casualty Actuarial Society: The professional actuarial organization focused on property, casualty, and related risk disciplines. Its credentials, research, and educational standards are widely recognized by insurers and regulators. |
| CAT | Catastrophe: A severe event that produces concentrated insured losses across many policies, such as a hurricane, earthquake, wildfire, or major convective storm. |
| CBI | Contingent Business Interruption: Coverage for income loss caused by covered damage at a dependent supplier, customer, or other designated location rather than at the insured’s own premises. |
| CCIP | Contractor-Controlled Insurance Program: A consolidated insurance program sponsored by a general contractor to cover eligible contractors and subcontractors working on a construction project. |
| CDF | Cumulative Development Factor: An actuarial factor used to project reported or paid losses from their current maturity to an ultimate value. |
| CGL | Commercial General Liability: A standard commercial coverage for liabilities including bodily injury, property damage, personal injury, and advertising injury, subject to exclusions and limits. |
| CLUE | Comprehensive Loss Underwriting Exchange: A claims-history database used by participating insurers in personal auto and property underwriting, subject to consumer-reporting requirements. |
| CMP | Commercial Multiple Peril: A statutory and market line combining multiple commercial property and liability coverages within a package policy. |
| CMS | Centers for Medicare & Medicaid Services: The U.S. federal agency responsible for Medicare coordination and reporting requirements that can affect workers’ compensation and liability settlements. |
| COI | Certificate of Insurance: A document summarizing specified insurance policies, limits, and effective dates. It provides evidence of coverage but does not itself amend the underlying policies. |
| COPE | Construction, Occupancy, Protection, and Exposure: Four core dimensions used to assess commercial property risk, including building features, operations, fire protection, and surrounding hazards. |
| COR | Combined Operating Ratio: A measure comparing underwriting losses and expenses with earned premiums. A result below 100% generally indicates an underwriting profit before investment income. |
| CPCU | Chartered Property Casualty Underwriter: A professional designation covering property and casualty insurance, risk management, underwriting, operations, and ethics. |
| CPP | Commercial Package Policy: A modular policy that combines two or more commercial coverages, commonly property and general liability, while allowing greater customization than a businessowners policy. |
| CR | Combined Ratio: The sum of an insurer’s loss ratio and expense ratio. It is a central measure of underwriting performance, with values below 100% generally indicating underwriting profitability. |
| CSL | Combined Single Limit: An automobile liability limit that applies one aggregate amount per accident to covered bodily injury and property damage rather than using separate split limits. |
| CSM | Contractual Service Margin: Under IFRS 17, the unearned profit recognized as insurance services are provided. Many short-duration property and casualty contracts instead qualify for the simplified premium allocation approach. |
| CY | Calendar Year: A financial reporting view that combines claim activity recorded during a year regardless of the accident year or policy year from which it originated. |
| D | |
| D&O | Directors and Officers Liability Insurance: Coverage for certain claims alleging wrongful acts by company directors and officers, often including separate protection for the organization and reimbursement of indemnification costs. |
| DAC | Deferred Acquisition Costs: Eligible costs associated with acquiring or renewing insurance contracts that are capitalized and recognized over the related coverage period under applicable accounting rules. |
| DBA | Defense Base Act: A U.S. federal law extending workers’ compensation protection to certain employees working outside the United States on military bases or designated government contracts. |
| DCC | Defense and Cost Containment: A statutory claim-expense classification that includes legal defense, litigation management, and other costs directly associated with defending or controlling specific claims. |
| DIC | Difference in Conditions: A specialty property policy designed to cover selected perils or conditions excluded from standard property insurance, frequently including earthquake or flood subject to its terms. |
| DOI | Department of Insurance: A state or territorial authority that regulates insurers, policy forms, rates, licensing, solvency, and market conduct within its jurisdiction. |
| DPW | Direct Premiums Written: Premiums written by an insurer before deductions for ceded reinsurance. The measure indicates the direct scale and growth of an underwriting portfolio. |
| DRP | Direct Repair Program: An insurer-managed network of automobile repair facilities operating under agreed service, estimating, and quality requirements. |
| DSU | Delay in Start-Up: Construction insurance covering specified financial losses when covered physical damage delays a project’s planned commercial operation date. |
| DV | Diminished Value: The reduction in a vehicle’s market value after it has been damaged and repaired. Whether it is recoverable depends on policy terms, claim circumstances, and jurisdiction. |
| E | |
| E&O | Errors and Omissions: Professional liability coverage for claims alleging negligence, errors, or failure to perform professional services. Coverage is often written on a claims-made basis. |
| E&S | Excess and Surplus: The nonadmitted insurance market serving risks that admitted carriers may not cover because of unusual exposures, capacity needs, loss history, or other underwriting characteristics. |
| EAR | Erection All Risks: Engineering coverage for physical loss or damage during the installation, assembly, testing, and commissioning of machinery or industrial equipment. |
| EB | Equipment Breakdown: Coverage for certain accidental mechanical, electrical, and pressure-system breakdowns, including associated property damage and selected business-income losses. |
| EDI | Electronic Data Interchange: Standardized electronic transmission of policy, premium, medical, and claim information. It is particularly important for workers’ compensation reporting and transaction processing. |
| ELR | Expected Loss Ratio: The anticipated ratio of losses to earned premiums for a portfolio. Actuaries use it in pricing, reserving, planning, and Bornhuetter–Ferguson analyses. |
| ELT | Event Loss Table: A catastrophe-model output listing modeled events, occurrence rates, and associated losses. It supports exceedance-probability analysis and portfolio risk calculations. |
| EML | Estimated Maximum Loss: A risk-engineering estimate of the largest credible property loss under defined assumptions about fire protection, separation, and emergency response. |
| EMR | Experience Modification Rate: A workers’ compensation rating factor that compares an employer’s actual loss experience with expected experience for similar operations. |
| EP | Earned Premium: The portion of written premium attributable to coverage already provided during the reporting period. It is the standard denominator for many underwriting performance ratios. |
| EP | Exceedance Probability: The probability that modeled losses will exceed a specified threshold over a defined period. Catastrophe models present EP curves for occurrence and aggregate loss measures. |
| EPLI | Employment Practices Liability Insurance: Coverage for claims alleging wrongful employment acts such as discrimination, harassment, retaliation, or wrongful termination. |
| ER | Expense Ratio: The ratio of underwriting expenses to premiums, calculated using the accounting convention appropriate to the analysis. It is a core component of the combined ratio. |
| ERM | Enterprise Risk Management: An integrated framework for identifying, measuring, governing, and managing underwriting, catastrophe, reserve, credit, market, operational, and strategic risks. |
| ESFR | Early Suppression Fast Response: A high-performance sprinkler design intended to suppress fires rapidly in specified storage occupancies. Its presence can materially affect property-risk engineering and underwriting. |
| EUO | Examination Under Oath: A formal, sworn examination permitted under many policy conditions to obtain information relevant to a claim investigation or coverage determination. |
| F | |
| FAIR | Fair Access to Insurance Requirements: State-established property insurance plans that provide limited coverage to eligible applicants unable to obtain insurance in the voluntary market. |
| FAST | Financial Analysis Solvency Tools: NAIC analytical tools used by state regulators to screen insurer financial statements and identify potential solvency concerns. |
| FCAS | Fellow of the Casualty Actuarial Society: A senior professional actuarial credential demonstrating advanced competence in property and casualty pricing, reserving, risk, and related disciplines. |
| FCE | Functional Capacity Evaluation: An assessment of an injured person’s ability to perform work-related physical activities. It can inform workers’ compensation treatment, return-to-work, and disability decisions. |
| FCIC | Federal Crop Insurance Corporation: The U.S. government corporation that supports the federal crop insurance program and reimburses approved private insurers under program agreements. |
| FCRA | Fair Credit Reporting Act: A U.S. law governing consumer reports used in underwriting and claims, including insurance scores and claims-history reports. It establishes notice, accuracy, and dispute obligations. |
| FELA | Federal Employers’ Liability Act: A U.S. federal statute allowing eligible railroad employees to seek damages from employers for work-related injuries caused by negligence. |
| FEMA | Federal Emergency Management Agency: The U.S. agency responsible for major disaster programs and administration of the National Flood Insurance Program. |
| FIO | Federal Insurance Office: A U.S. Treasury office that monitors the insurance sector, coordinates certain federal insurance matters, and represents the United States in specified international discussions. |
| FMCSA | Federal Motor Carrier Safety Administration: The U.S. agency regulating commercial motor-vehicle safety. Its data and requirements are important to commercial auto underwriting and loss control. |
| FNOL | First Notice of Loss: The initial report that informs an insurer of a potential claim. Timely, accurate intake affects triage, reserving, investigation, customer service, and fraud detection. |
| FSR | Financial Strength Rating: A rating agency’s opinion of an insurer’s ability to meet ongoing policy and contract obligations. It can influence distribution access, customer confidence, and capital planning. |
| G | |
| GAAP | Generally Accepted Accounting Principles: The accounting framework used for general-purpose financial reporting in a jurisdiction. U.S. property and casualty insurers commonly report under both GAAP and statutory accounting. |
| GIA | General Indemnity Agreement: A surety agreement requiring the principal and other indemnitors to reimburse the surety for covered losses, costs, and expenses arising from issued bonds. |
| GL | General Liability: Liability insurance addressing specified third-party bodily injury, property damage, and personal or advertising injury exposures. |
| GLM | Generalized Linear Model: A statistical modeling framework widely used to estimate claim frequency, severity, pure premiums, and rating factors while controlling for multiple risk characteristics. |
| GMM | General Measurement Model: The default IFRS 17 model for measuring insurance contracts that do not qualify for, or elect, another permitted approach. |
| GWP | Gross Written Premium: Total premium written before deductions for reinsurance and other specified adjustments. It is widely used to describe portfolio scale and growth. |
| H | |
| H&M | Hull and Machinery: Marine insurance covering physical loss or damage to a vessel’s hull, machinery, and specified equipment. |
| HO | Homeowners: The standard policy-form prefix for homeowners insurance, with numbered forms indicating different combinations of property, liability, and loss-settlement provisions. |
| HPR | Highly Protected Risk: A commercial property risk with strong construction, fire protection, maintenance, and loss-prevention characteristics. The designation can support more favorable capacity and pricing decisions. |
| I | |
| IAIS | International Association of Insurance Supervisors: The global standard-setting body for insurance supervision, financial stability, and cross-border regulatory cooperation. |
| IBNER | Incurred But Not Enough Reported: The portion of ultimate claim cost expected to exceed current case reserves on known claims. It is often treated as a component of broader IBNR reserves. |
| IBNR | Incurred But Not Reported: An actuarial reserve for claim costs arising from insured events that have occurred but are not fully reflected in reported claim reserves. |
| ICC | Increased Cost of Compliance: National Flood Insurance Program coverage that helps eligible property owners comply with floodplain-management requirements after substantial or repetitive flood damage. |
| IFRS 17 | International Financial Reporting Standard 17, Insurance Contracts: The international accounting standard governing recognition, measurement, presentation, and disclosure of insurance contracts. |
| IM | Inland Marine: Property insurance covering movable property, property in transit, specialized equipment, and designated property exposures not adequately addressed by standard property forms. |
| IME | Independent Medical Examination: An examination by a medical professional who is not the claimant’s treating provider. It may inform causation, treatment, impairment, or disability evaluations. |
| IRIS | Insurance Regulatory Information System: An NAIC solvency-screening framework that applies financial ratios to insurer statutory data to help regulators identify companies requiring further review. |
| IRPM | Individual Risk Premium Modification: A permitted underwriting adjustment to manual premium based on risk characteristics not fully reflected in the base rating plan. |
| ISO | Insurance Services Office: A Verisk business associated with standardized policy forms, advisory loss costs, classifications, underwriting information, and claims data used across the U.S. property and casualty market. |
| ITV | Insurance to Value: The relationship between a property’s insurance limit and its estimated insurable value. Adequate ITV supports sound pricing and reduces underinsurance and coinsurance issues. |
| K | |
| K&R | Kidnap and Ransom: Specialty coverage for specified kidnapping, extortion, detention, ransom, crisis-response, and related expenses, subject to strict confidentiality and notification conditions. |
| L | |
| LAE | Loss Adjustment Expense: The costs of investigating, adjusting, defending, and settling claims. Insurers analyze LAE separately from indemnity losses for reserving and operational management. |
| LCM | Loss Cost Multiplier: A factor applied to advisory loss costs to incorporate an insurer’s expenses, profit provision, and other rating considerations when developing filed rates. |
| LDF | Loss Development Factor: An actuarial factor used to project reported or paid claims from one maturity point to a later maturity or ultimate value. |
| LHWCA | Longshore and Harbor Workers’ Compensation Act: A U.S. federal law providing workers’ compensation benefits to eligible maritime employees injured on navigable waters or adjoining areas. |
| LIC | Liability for Incurred Claims: Under IFRS 17, the obligation for insured events that have already occurred, including expected claim payments, expenses, discounting, and risk adjustment where applicable. |
| LOB | Line of Business: A distinct insurance product or statutory reporting category, such as homeowners, commercial auto, general liability, or workers’ compensation. |
| LR | Loss Ratio: The ratio of incurred losses and, depending on convention, loss-adjustment expenses to earned premium. It is a fundamental measure of underwriting performance. |
| LRC | Liability for Remaining Coverage: Under IFRS 17, the obligation to provide insurance service for the unexpired portion of a group of contracts. |
| LRRA | Liability Risk Retention Act: The U.S. federal law permitting qualifying risk retention groups and purchasing groups to address commercial liability exposures across state lines under specified conditions. |
| M | |
| MCAS | Market Conduct Annual Statement: An NAIC-developed regulatory data collection used to monitor insurer practices involving claims, underwriting, policy service, cancellations, and consumer complaints. |
| MedPay | Medical Payments Coverage: Coverage that pays specified medical expenses for eligible injured persons regardless of fault, commonly included in personal auto and premises-liability policies. |
| MFL | Maximum Foreseeable Loss: A property-risk estimate of the largest loss reasonably expected under adverse but credible conditions, often assuming failure of some protection features. |
| MMI | Maximum Medical Improvement: The stage at which an injured person’s condition is not expected to improve materially with further treatment. It often affects workers’ compensation impairment and benefit decisions. |
| MMSEA | Medicare, Medicaid, and SCHIP Extension Act of 2007: A U.S. law imposing mandatory insurer reporting requirements for certain settlements, judgments, awards, and payments involving Medicare beneficiaries. |
| MPCI | Multiple Peril Crop Insurance: Federally supported crop coverage protecting against designated causes of yield or revenue loss, offered through approved private insurers. |
| MPL | Maximum Possible Loss: A risk-engineering estimate of the greatest loss possible under defined assumptions, often including failure of protection and control measures. |
| MPL | Medical Professional Liability: Liability insurance for healthcare organizations and professionals facing allegations of negligent treatment, errors, or omissions in medical services. |
| MSA | Medicare Set-Aside: An arrangement allocating part of a workers’ compensation settlement to future injury-related medical costs that would otherwise be payable by Medicare. |
| MSP | Medicare Secondary Payer: Federal rules under which workers’ compensation, liability, and no-fault insurance may be primary to Medicare for covered injury-related expenses. |
| MVR | Motor Vehicle Record: A driver-history report containing licensing status, violations, and other driving information used in personal and commercial auto underwriting. |
| N | |
| NAIC | National Association of Insurance Commissioners: The U.S. standard-setting and regulatory-support organization governed by state insurance regulators. It develops model laws, financial statements, data systems, and accreditation standards. |
| NCCI | National Council on Compensation Insurance: A workers’ compensation rating and data organization that develops classifications, loss costs, experience-rating plans, and statistical analyses for participating states. |
| NEP | Net Earned Premium: Premium recognized for coverage already provided after the effect of applicable reinsurance. It is commonly used to evaluate retained underwriting performance. |
| NFIP | National Flood Insurance Program: The U.S. federal program providing flood insurance, floodplain-management standards, and flood-risk mapping for participating communities. |
| NFPA | National Fire Protection Association: An organization that publishes widely used fire, electrical, life-safety, and property-protection codes and standards relevant to risk engineering. |
| NICB | National Insurance Crime Bureau: A nonprofit organization that works with insurers and law enforcement to detect, prevent, and investigate insurance fraud and vehicle theft. |
| NLE | Normal Loss Expectancy: A property-risk estimate of the expected loss when installed protection systems and normal emergency response operate as intended. |
| NPW | Net Premiums Written: Written premium retained after deducting premiums ceded to reinsurers and adding assumed premium where applicable. It indicates the underwriting volume retained on the insurer’s books. |
| O | |
| OCP | Owners and Contractors Protective Liability: A separate liability policy protecting a project owner or contractor against specified vicarious liability and supervisory acts arising from a designated contractor’s work. |
| OCIP | Owner-Controlled Insurance Program: A consolidated insurance program sponsored by a project owner for eligible contractors and subcontractors working at a designated construction project. |
| OEM | Original Equipment Manufacturer: The company that manufactured a vehicle or component. Auto claim disputes may concern whether repairs use OEM, alternative, recycled, or aftermarket parts. |
| OEP | Occurrence Exceedance Probability: The probability that the largest single catastrophe event in a year will exceed a specified loss amount. |
| ORSA | Own Risk and Solvency Assessment: An insurer’s internal assessment of material risks, risk-management capabilities, and current and prospective capital adequacy, documented for regulatory review. |
| OSHA | Occupational Safety and Health Administration: The U.S. agency responsible for workplace safety and health standards. Its requirements and data inform workers’ compensation loss prevention and risk assessment. |
| P | |
| P&C | Property and Casualty: The insurance sector covering property loss, legal liability, motor, workers’ compensation, and numerous personal, commercial, and specialty risks. |
| P&I | Protection and Indemnity: Marine liability insurance addressing shipowners’ and operators’ exposures such as crew injury, collision liability, pollution, and cargo-related liabilities. |
| PA | Public Adjuster: A licensed claim professional retained by a policyholder to assist in documenting, presenting, and negotiating a first-party property claim. |
| PAA | Premium Allocation Approach: A simplified IFRS 17 measurement approach commonly applicable to short-duration insurance contracts, including many property and casualty policies. |
| PAS | Policy Administration System: A core insurance platform supporting policy quotation, issuance, endorsements, renewals, cancellations, billing interfaces, and policy records. |
| PCS | Property Claim Services: A Verisk service that designates qualifying catastrophe events and provides insured-loss estimates used by carriers and other market participants. |
| PD | Property Damage: Physical injury to, destruction of, or loss of use of tangible property. It is a core insuring concept in automobile and general liability coverage. |
| PIF | Policies in Force: The number of active policies on an insurer’s books at a specified date. It is used to track portfolio scale, retention, and growth. |
| PIP | Personal Injury Protection: No-fault automobile coverage paying specified medical expenses, lost income, and related benefits regardless of responsibility for the accident, subject to state law. |
| PLL | Pollution Legal Liability: Environmental insurance covering specified cleanup costs, bodily injury, property damage, and legal expenses arising from pollution conditions. |
| PML | Probable Maximum Loss: An estimate of a large but plausible loss under defined assumptions. Property underwriters and catastrophe modelers use it to manage limits, accumulations, and capital. |
| PPC | Public Protection Classification: A Verisk classification of a community’s fire-suppression capabilities. Property insurers may use it in underwriting and rating. |
| PPD | Permanent Partial Disability: A workers’ compensation classification for a lasting impairment that does not completely prevent employment. Benefit calculations vary by jurisdiction and impairment type. |
| PTD | Permanent Total Disability: A workers’ compensation classification for a lasting disability that meets the jurisdiction’s standard for total incapacity. |
| PY | Policy Year: A method of grouping premium and losses according to the year in which policies became effective. It supports underwriting and actuarial cohort analysis. |
| R | |
| RA | Risk Adjustment: Under IFRS 17, compensation an insurer requires for bearing uncertainty about the amount and timing of nonfinancial-risk cash flows. |
| RBC | Risk-Based Capital: A regulatory framework that establishes capital requirements based on an insurer’s underwriting, asset, credit, and other material risks. |
| RBNS | Reported But Not Settled: Reserves established for known claims that remain open or unpaid. They are commonly called case reserves and form part of total claim liabilities. |
| RCV | Replacement Cost Value: The cost to repair or replace damaged property with property of comparable kind and quality without deducting depreciation, subject to policy conditions and limits. |
| RMA | Risk Management Agency: The U.S. Department of Agriculture agency that administers and oversees the federal crop insurance program through the Federal Crop Insurance Corporation. |
| RMAD | Risk of Material Adverse Deviation: The possibility that actual claim liabilities will materially exceed the carried reserve. U.S. actuarial opinions address this risk using company-specific materiality and risk factors. |
| RMIS | Risk Management Information System: A platform used to consolidate exposure, policy, incident, claim, safety, and financial data for risk management and insurance program oversight. |
| RMS | Risk Management Solutions: A widely recognized catastrophe-modeling business and platform, now operating as Moody’s RMS, used to quantify natural catastrophe and other extreme-event risks. |
| RRG | Risk Retention Group: A member-owned liability insurance company formed under the federal Liability Risk Retention Act to insure similar or related commercial risks. |
| S | |
| SAO | Statement of Actuarial Opinion: A formal opinion by a qualified actuary addressing the reasonableness of an insurer’s carried loss and loss-adjustment expense reserves. |
| SAP | Statutory Accounting Principles: Insurance accounting rules designed primarily to support solvency regulation and policyholder protection. U.S. insurers use them for statutory financial statements filed with regulators. |
| SERFF | System for Electronic Rates & Forms Filing: An NAIC-operated platform through which insurers submit rates, rules, and policy forms to participating state regulators. |
| SIR | Self-Insured Retention: The amount an insured must fund before specified policy coverage responds. Unlike many deductibles, the insured may be responsible for handling claims within the retention. |
| SIU | Special Investigation Unit: An insurer function dedicated to identifying and investigating suspected fraud, material misrepresentation, organized schemes, and other questionable claim activity. |
| T | |
| TIV | Total Insured Value: The aggregate insured value of covered property, business income, and other specified interests at a location or across a portfolio. |
| TPA | Third-Party Administrator: An external organization that performs claims administration, policy services, or related functions for insurers, self-insured employers, and insurance programs. |
| TPD | Temporary Partial Disability: Workers’ compensation benefits for an injured employee who can work during recovery but has reduced hours, duties, or earnings. |
| TRIA | Terrorism Risk Insurance Act: The U.S. federal law establishing a public-private loss-sharing framework for certified acts of terrorism and requiring insurers to offer specified terrorism coverage. |
| TRIP | Terrorism Risk Insurance Program: The U.S. Treasury program implementing the federal terrorism insurance backstop created by TRIA. |
| TTD | Temporary Total Disability: Workers’ compensation benefits replacing part of an employee’s wages while a covered injury temporarily prevents any work. |
| TVaR | Tail Value at Risk: The average loss beyond a selected value-at-risk threshold. It helps quantify the severity of extreme catastrophe or aggregate underwriting outcomes. |
| U | |
| UIM | Underinsured Motorist: Automobile coverage that may compensate insured persons when an at-fault driver’s liability limits are insufficient to cover eligible damages. |
| ULAE | Unallocated Loss Adjustment Expense: Claim-handling expense not readily attributable to a specific claim, such as portions of claims staff, systems, and departmental overhead. |
| ULR | Ultimate Loss Ratio: The estimated ratio of fully developed losses to earned premium for a defined portfolio and period. |
| UM | Uninsured Motorist: Automobile coverage that may compensate insured persons for eligible damages caused by a driver who has no applicable liability insurance. |
| UPR | Unearned Premium Reserve: The liability representing premium associated with the unexpired portion of active policies. It is released into earned premium as coverage is provided. |
| UY | Underwriting Year: A method of grouping all premium and losses from contracts written during a given year, commonly used in specialty and subscription insurance markets. |
| V | |
| VaR | Value at Risk: A statistical estimate of the loss threshold expected not to be exceeded at a stated confidence level and time horizon. Insurers use it in capital and catastrophe-risk analysis. |
| W | |
| WC | Workers’ Compensation: Statutory insurance providing medical, wage-replacement, rehabilitation, and death benefits for eligible work-related injuries and occupational diseases. |
| WP | Written Premium: Premium recorded for policies issued or renewed during a period before recognition as earned premium over the coverage term. |
| WYO | Write Your Own: The National Flood Insurance Program arrangement under which participating private insurers issue and service federal flood policies in their own names. |
| Y | |
| YLT | Year Loss Table: A catastrophe-model output containing simulated annual losses across many modeled years. It supports aggregate exceedance probabilities, tail metrics, and portfolio analysis. |