ALARM assists, advises and represents public sector organisations in the development of risk management strategies. In collaboration with the Association of Insurance and Risk Managers and the Institute of Risk Management ALARM has developed a new Risk Management Standard.

Policy may warrant that an approved alarm system be kept in operation. In De Maurier (Jewels) Ltd v. Bastion Insurance Co. Ltd and Coronet Insurance Co. Ltd (1967), a warranty in a jewellers’ ‘all risks’ insurance stated ‘alarms on road vehicles be kept in operation… Held: ‘in operation means the system must be switched on in circumstances where the user has reason to believe that switching it on makes it fully operative. It does not mean “fully operative”. If, because of an unknown fault, it fails to operate there will be no breach of warranty by the insured.

A phrase in the basic specification wording of the standard fire policy to extend cover to forms of property otherwise excluded. The term includes money and stamps, national insurance stamps, documents, manuscripts and business books, computer systems records, patterns, moulds, plans and designs, employees’ pedal cycles and personal effects. Monetary limits are usually applied to the majority of these items and cover in respect of plans, documents, etc., is limited to the cost of labour in writing them up and not their market values.

This means something possible of accomplishment regardless of cost but dependent on the state of knowledge at the time. For example, regulations under the Health and Safety at Work Act 1974 provide that all practicable steps shall be taken to ensure that no person employed shall be in the space between any moving part of a self-acting spinning mule and any fixed part of the machine towards which it is traversing. Compare with properly maintained and reasonably practicable.

An alternative name for an in and out insurance policy.

Group of perils commonly added to a standard fire policy. They are otherwise called additional perils, defined perils or special perils. They embrace dry perils (aircraft, explosion, riot, etc.), wet perils (storm, flood, burst pipes, etc;) and miscellaneous perils (impact, subsidence, etc).

The part of a Lloyd’s member’s overall premium limit that is allocated to a syndicate in the relevant year of account.

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This may refer to a member’s allocated capacity or syndicate allocated capacity.

The limit as to the premiums that may be accepted on behalf of a Lloyd’s underwriting member, i.e. Name or corporate member. It is expressed as the maximum permissible amount of a member’s premium income which can be allocated to any year of account. See OVERWRITING OF PREMIUMS.

A directors’ and ity term dealing with the division of defence costs and loss payments when a claim is made against: (a) insured directors and officers and a non-covered entity such as the company; or (b) insured individuals in respect of covered and non-covered allegations. Some policies contain no express words dealing with the situation, while in others the insurer undertakes to use his ‘best effort’ to allocate defence costs proportionately between the insured individuals and the uninsured company. However, the modern tendency is for the insurer to advance 100 per cent of defence costs for both the company and the individual insureds. In the case of (b), where only part of the allegations are insured, the insurer usually seeks to ‘negotiate in good faith’ to secure a fair and equitable allocation of the loss taking account of the relative legal exposure of the parties. Disputes are referred to a QC.

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MEDICAL, US: Assignment of overhead costs such as financial, operational, and personnel salaries to different departments in a hospital facility, managed care plan, or insurance company depending on usage of physical space, staffing size, and other fair and reasonable considerations. Also called allocation of overhead.

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UK: an appropriation of surplus, generally to policyholders, by way of, for example, a reversionary bonus.

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Refers to the process of determining the amount of defense costs and any settlement or judgment that is properly attributable or allocated to covered claims against insureds, on the one hand, and uninsured claims against insureds and others, on the other hand. In essence, allocation simply refers to the process of determining the amount of insured loss when that loss is commingled with uninsured loss. The need for allocation arises most frequently under D&ampO insurance policies that cover claims against directors and officers but not claims against the company. Because directors and officers and the company are often both sued in the same claim, allocating loss between the directors and officers and the company can be difficult and sometime contentious. Several alternative D&ampO insurance policy provisions are now available to minimize allocation uncertainties and disputes. Some of those alternatives include, A. Entity Coverage. This alternative grants coverage for Securities Claims (or perhaps employment claims) against the company whether or not directors and officers are codefendants.,B. Co-Defendant Coverage. This alternative grants coverage for any claim against the company provided that the claim is also made against directors and officers. , C. Pre-Determined Allocation. This alternative establishes in the insurance policy the specific allocation percentage applicable to securities claims (and perhaps other types of claims) regardless of the facts in each specific claim., D. Methodology. This alternative identifies in the insurance policy the method by which the allocation issue will be determined in a particular case. This alternative does not eliminate the allocation issue, but identifies what criteria will be used by the parties in determining an appropriate allocation. Some of the methodologies contained in D&ampO policies include allocating based upon the relative legal exposures of the parties or “the relative legal and financial exposures of and relative benefits to” the parties. Other policies simply require that the parties commit their best efforts to agree on a fair and reasonable allocation under the circumstances of each claim.