CII’s starting point for newcomers to general insurance under the banner Award in Insurance. The single-subject course provides a basic understanding of how the market works, fundamental risk and insurance principles and procedures, and core personal and commercial insurance products. After completing FIT, candidates can proceed to the next general qualification, the Certificate in Insurance.
Insurance Encyclopedia
Foundation Wall
Masonry wall below ground supporting building.
Foundations clause
Fire Insurance clause that provides that the value of the foundation (any part of the building below ground level) can be excluded from the buildings sum insured and is not to be included when determining the value of property at the time of a loss. The clause is used when it is considered that the foundations would not be affected by a loss.
Foundering
A ship which is sinking.
Four corners of an instrument
A term that refers to studying an entire document for its meaning without reference to information outside of the document, such as negotiations prior to its writing. Often called four corners rule.
FOUR CORNERS TEST
Insurance companies have a duty to defend their insureds when legal action is brought against the insured. However, the actual suit may not be worded in such a manner as to indicate coverage. The court will compare the language of the suit with the language of the policy to see if coverage applies. This comparison of the complaint and the policy is known as the “four corners test.” Courts often broadly interpret the insurance company’s duty to defend and may impose bad faith penalties if the company fails to defend when there is any possibility that the claim is covered by the policy. (See Bad Faith).
Four-character subcategory
In the International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM) , a letter with two digits followed by a period or decimal point and one number that gives more information on the description of a condition.
Fourth and fifth digits
Numerical characters in the International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM) code book after three digits that gives additional specific information about the diagnosis or procedure to be coded. Under Medicare guidelines, some diagnostic and procedure codes require fourth or fifth digits to pass insurance claims processing edits for reimbursement.
Fourth digit
Symbol used in the diagnostic code book titled International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM) . It is used to indicate that a fourth digit is required for coding to indicate the highest level of specificity.
Fourth EU Motor Insurance Directive
Became law in the UK in January 2003. Principal aim is to improve the claims process for EU residents when claiming against an insurer based in another EU state. The UK’s response is the Motor Insurance Database which, on being given the vehicle registration number of the third party, will be able to trace the third party’s insurer.