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Insurer’s option

Material damage insurers reserve the right to provide the indemnity by monetary payment, repair, reinstatement or replacement. In the absence of an option the insured could demand a cash payment. The insurer loses the option if he fails to exercise his alternative rights in a reasonable period of time. An insurer who has indicated his preference may be estopped from choosing an alternative course.

Insuring agreement

In an insurance contract, the insurer’s promise to pay.
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That part of an Insurance Policy which states in general terms the agreement of the Insurer to protect the insured. See Also: “Insurance Policy.”
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US: That portion of the insurance policy in which the insurer promises to make payment to or on behalf of the insured. The insuring agreement is usually contained in a coverage form from which a policy is constructed. Often, insuring agreements outline a broad scope of coverage, which is then narrowed by exclusions and definitions.
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The section of the policy contract that specifies the hazards the insured is covered against, the people covered, and the length of the contract.

Insuring Agreement A

This pays on behalf of the directors and officers any money owed due to negligent acts committed by them. Firms may, if the law in its locality allows, reimburse directors and officers for losses due to their negligent acts. There are three main reasons a firm may not reimburse its directors and officers. One is that some state laws do not allow reimbursement. A second reason is that the firm may not be financially able to reimburse and, third, the firm may simply choose not to reimburse.

Insuring Agreement B

If the firm does reimburse directors and officers for negligent acts associated with their duties, insuring agreement B reimburses the firm for a like amount.Entity Securities Coverage and Employment PracticesLiability may also be added to the D&O policy. Coverage forms for D&O are not standardized and need to be carefully examined. One issue that often arises is the definition of an insured. For example, if a director, who owns stock in the firm, sits on a corporate board and there is a shareholder suit against the board, the director is both defendant and plaintiff. Similarly, if a homeowner is a director of the local homeowners’ association and there is a suit, is the director acting as a director or homeowner? The definition of insured in the D&O policy needs to make this clear.

Insuring to value

A requirement of property insurance policies that the property be insured to the value to replace the property in event of a loss. The cost to rebuild or replace a property is not the same as the market value of the property.

Insuritisation

The transfer of financial risk from the capital to the insurance market. A bank securitises a portfolio of corporate bonds or loans known as collateralised debt obligations or through a portfolio of credit default swaps. A special purpose vehicle buys the CDOs and passes them through to (re)insurers who are significant investors in subordinated debt based on relatively homogenous assets such as residential mortgage loans, credit card receivables or car loans. Other examples: residual value insurance, revenue guarantee products and other customised financial products. Other risks transferred to the insurance market have included project finance and royalty streams embracing film, franchises, drugs and music. The insurer forfeits repayment of interest and/or capital if there is default on the loans.

Insurrection

A revolt against civil authority or established government. It has been defined as a ‘rising of the people in open resistance against established authority with the object of supplanting it’.
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A rising of people against established authority with the object of supplanting it.