The risk that significant increases in the inflation rate will have a disproportionate effect on insurers, e.g. the inflation factor built in to long-tail liability claims may outweigh the general economic level of inflation. Inflation is also of importance in health and medical insurance as the claims inflation may be higher than economic inflation.

Created out of the 1995 merger between Lloyd’s of London Press Ltd and IBC Ltd. The previous publications, Lloyd’s List, Lloyd’s Shipping Index, Lloyd’s Casualty Week are now part of the Informa Group’s family of products and services. The website www.infformamaritime.com sets out comprehensive details. See LLOYD’S MARINE INTELLIGENCE UNIT.

Insurance against legal liability for inadvertently infringing a copyright, patent or trademark.

Aircraft damage caused when foreign objects (e.g. stones from runway, birds) are drawn into the airtake by the suction of the engine and rotate around in contact with the rotating compressor blades. The risk applies mainly to turbo-jet and turbo-propeller engines. Even slight damage necessitates completes stripping of the engine. The aircraft policy covers the damage subject to a sizeable excess but excludes progressive deterioration. Cover responds to sudden damage necessitating immediate repair.
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Damage caused by foreign bodies being drawn into the air intake of the turbine engine of an aircraft.

A UK tax on capital wealth or assets transferred to other persons (except a spouse) within the seven years preceding the benefactor’s death. There are certain exemptions from IHT, e.g. gifts out of income; gifts to support certain relatives in need. Life insurance is used to both minimise and pay the tax. Liquid funds from a policy obviates the forced disposal of assets to fund the tax liability. The first £255,000 is in a ‘nil rate’ tax band (2003).

any part of a life insurer’s assets which is not required for smoothing purposes or to pay terminal bonuses; sometimes referred to as ‘orphan estate’.

An important interference with the environment caused by a modification of the physical, chemical or biological conditions of water, soil and/or air in so far as these are not to be considered to be damage to property or death or physical injury. The authorities seek to make the polluter pay on a strict liability basis for this and other forms of injury and damage.

Employers’ liability policy clause that brings liability for injury to the proprietors of a partnership within the policy. If a partner is injured at work due to the negligence of an employee or another partner, a standard employers’ liability policy will not operate but the clause brings such injury into the policy subject otherwise to its terms and conditions. Consequently the premium is calculated as if all partners were employees, i.e. their earnings must be included in the estimate and declarations relating to wages and salaries.

A theory seeking to trigger a long-tail injury (e.g. asbestosis) only into those losses-occurring liability policies or policy periods during which there was actual occurrence or development of the injury. It ignores exposure to the risk of injury and the manifestation of it. No liability is attached to policies in force during which there was no progression of the injury but the theory is difficult to apply. See TRIPLE TRIGGER THEORY.

The contribution and benefit limits that must not be exceeded under approved pension schemes, which receive valuable tax relief. Contributions, including AVCs, cannot exceed 15 per cent of annual earnings before deductions for tax and national insurance. For members joining after May 1989 the earnings themselves are subject to the earnings cap. The maximum pension benefit under approved occupational schemes, defined benefit or defined contribution, is the same, i.e. two-thirds of final remuneration.