UK: A fact that would influence the judgement of a prudent underwriter in deciding whether to accept a risk for insurance and on what terms. The proposer has a duty to disclose material facts at the inception, at renewal and in respect of mid-term alterations where there has been a change in risk. Examples: motor insurance – details of young drivers; industrial activities – heating processes and previous claims.
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UK: a fact which influences a prudent underwriter in deciding whether to accept or decline a risk, and in determining the rate of premium or the imposition of any special conditions.
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Materiality is a question of fact, to be decided in the circumstances which would influence the judgment of a prudent Insurer in fixing the premium or determining whether he will take the risk and, if so, at what premium and on what conditions.
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MEDICAL,USA: Statement of a situation that is of such importance that disclosure would alter an underwriting decision regarding issuance or rating of an insurance policy or loss settlement.
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This refers to any fact which would influence the judgment of a prudent underwriter in deciding whether to accept an insurance/reinsurance risk and the terms on which he would be willing to grant cover. See duty of disclosure.

A benefit payable under some private health insurances at a specified rate, e.g. £250 for each child, after the policy has been in force for at least 10 months.

a life insurer’s actuarially calculated assessment of its obligations to policyholders; broadly the difference between the present value of anticipated policyholder benefits and present value of future premiums.
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Provision made by an insurer to cover liabilities (excluding liabilities which have fallen due) arising under or in connection with contracts for long-term business.

the end of the term of, for example, an endowment policy.

The maximum pension benefit a member can receive under an approved scheme. This does not apply to personal pensions or simplified defined contribution schemes. The maximum amount varies according to whether the member is a Class A, Class B or Class C member.

The largest possible loss that could occur given the worst combination of circumstances. Under a fire policy the worst case scenario would be a fire in circumstances where the automatic sprinklers and fire extinguishers failed, and the fire brigade came late to the scene. A further coincidence might be a fully stocked warehouse containing high value combustible goods. Compare with estimated maximum loss (EML).

Motor insurers exclude mechanical and electrical breakdown from the own damage’ section of a comprehensive policy. If the breakdown, e.g. brake failure, causes an own damage’ accident, the damage will be covered but not the repair of the brake. However, if the breakdown is the result of failure to observe the reasonable care condition the insured may get no cover except for the compulsory insurance elements of his policy and then subject to the insurer’s right to recover the amount paid.

1. Covers the cost of breakdown of household appliances or motor vehicles. 2. See AVIATION MECHANICAL BREAKDOWN INSURANCE.