Alternative term for ‘pay as you go’, a method of calculating life insurance risk premiums on a year-byyear basis. Each premium reflects the chance that the policyholder will die in the following year plus an allowance for expenses. It is suitable where term (temporary) insurance is purchased on a year-by-year basis, e.g. as group life cover. The influx of new members helps to stabilise the overall annual cost. The level annual premium system is more appropriate for individual lives.

an independent professional who advises and negotiates on behalf of policyholders on the settlement of their claims.

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Person who estimates the value of goods for the purpose of apportioning the sum payable by the underwriters to settle the claims. Also called as Surveyor.

The way in which the assets of a pension fund are distributed across a range of alternative investments, such as equities, fixed interest securities or cash. The strategy is based on the fund’s long-term needs but shifts towards particular assets may occur to take advantage of short-term opportunities.

An insurer has to identify assets belonging to him that he maintains for a particular aspect of his business, e.g. separate funds for longterm business. The UK Treasury is empowered to pass regulations that prevent unauthorised parent undertakings of insurers, or others specified by the Treasury, from doing anything (e.g. payment of dividends or creation of charges) that lessens the effectiveness of the asset identification rules (FMSA s.142 (1)(2)).

Special rules governing the way in which insurance company assets should be valued for the purpose of government returns and matters relating to solvency. Assets representing long-term funds are separated from those representing general business funds. Further sub-divisions required. The basic rules call for ‘break up values’ and not, as is the case with ordinary commercial companies, ‘going concern’ figures. In this context no value can be placed on goodwill. See ADMISSIBILITY; ASSET LIABILITY are MATCHING.

Debt securities that depend on a pool of underlying assets. In alternative risk transfer they refer to insurance-linked securities. See INSURITISATION; SECURITISATION.

Pensions term where the aim is to invest in assets likely to generate the cash flow needed to meet the liabilities of the scheme as they occur under varying economic conditions.

Cash, investments and property owned by insurance companies and other entities. They include equity investments, bonds, property, money owed by debtors (if collectable) and anything else with a monetary value. FSA regulations require insurers to put a conservative value on their admissible assets.

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Assets refer to property and possessions owned by an insurance company, which include real estate, buildings, furniture, stocks, bonds, and cash. In order to insure the public that insurance companies have the ability to pay claims, state laws require insurance companies to prove solvency. Further, state laws require a conservative valuation of all assets and do not permit any asset on the balance sheet where the value of an asset is uncertain or in the case of accounts receivables any receivables more than 90 days past due. Assets can be divided into three categories: invested assets, other assets, and admitted assets.These are assets that have been invested in an effort to generate income. Included are such things as cash, bonds, stocks, and income-producing real estate and properties.Invested Assets

Non-Income Generating Assets

This type of asset includes the building in which the company resides, furniture, and accounts receivable. Some states permit insurance companies to claim deferred and unpaid premiums as other assets.

Admitted Assets

Admitted assets are assets the company owns and which state law permits the company to place on its annual statement. Admitted assets are used to determine a company’s solvency and ability to pay the claims of its policyholders. In most cases, admitted assets are assets that can be easily liquidated or borrowed against. They may include real estate, mortgages, stocks, and bonds. Other assets of the insurance company are considered non-admitted assets. (See Risk-Based Capital).

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US: All funds, property, goods, securities, rights of action, or resources of any kind owned by someone.

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All the available properties of every kind of an Insurance Company that may be used to pay its debts. These would include real estate, bonds, mortgage, stock, cash, deferred and unpaid premiums. The assets of an Insurance Company include all funds, property, goods, securities, rights of action or reserve of any kind owned by it, less such items as are declared non-admissible by statute.

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US, MEDICIAL :

1. Anything owned that has exchange value, e.g., cash, federal treasury notes and bonds, property, data processing equipment, and investments. 2. Under Medicaid, property owned that the government takes under review when a patient applies for financial assistance. 3. Under Medicare Part D, the government counts cash or any property that can be turned into cash within 20 days, such as checking and savings accounts, certificates of deposit, IRAs, and 401(k)s, stocks, bonds, and similar items. It does not include a patient’s primary home, or certain property related to burial expenses. 4. Treasury notes and bonds guaranteed by the federal government, owned properties, and cash held by the trust funds for investment purposes.

A US term to describe a risk that is not ordinarily acceptable to insurers and therefore by law is assigned to an insurer participating in an assigned risk pool or plan. Each insurer in the pool accepts its share of all of the pooled risks.

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A risk not generally acceptable to any insurance company but for which the law says that insurance must be acquired. Personal auto liability is one such necessary coverage. Insurance companies doing personal auto business in a state can be required to accept assignment of a portion of the state’s unacceptable drivers as insureds.

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A risk that may not be generally acceptable to any insurance company but for which the law says that insurance must be acquired. Motor Third Party is one such necessary coverage.

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MEDCIAL, US: Uncertainty (risk) that insurance underwriters do not want to insure but because of state laws are required to insure. For example, individuals who may be within a certain young age group, may have had an automobile accident, heart condition, diabetes, or hypertension. Most assigned risks are issued insurance through a system of proportional assignment chosen from a group of insurance companies. This is more commonly seen in casualty insurance.

The assignment of rights and obligations under a contract, which arises automatically by operation of the law without the consent of either party to the contract (e.g. on death or in the event of bankruptcy).