After health insurance premium income, the deficiency that remains after payment of insurance claims and administrative expenses.

Procedure and policy book that summarizes methods used by a specific insurance company to evaluate and rate risks. Underwriters use this as a reference book to research background information on underwriting impairments. It gives suggestions for underwriting actions to take when various impairments are present.

Insurance company’s income from its operations as distinct from its investment earnings.
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The measure of the profitability of an insurer’s underwriting activity. This refers to earned premiums (net of reinsurance) with net operating expenses and claims incurred (net of reinsurance) subtracted. The underwriting profit does not include any investment income.

Instructions giving information on data required for insurability for a given situation and optional information sources needed to provide underwriters with needed information about the insured (e.g., medical records or physical examination report). These requirements are graduated based on the insured’s age and the amount of insurance coverage.

A service that has been billed on an insurance claim for which there is either insufficient or no supporting documentation to validate the service or procedure in the patient’s medical record.

Fund that holds a part of the insurance premium that has been paid in advance for which the protection of the policy has not yet been provided. Also called unearned premium .
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A reserve equal to an amount of net premium written but not yet earned.
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The amount of all premiums which have not been earned as of a particular point in time, which is shown on the insurer’s balance sheet.
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The fund set aside by an Insurance Company to provide for the payment of unearned premiums on cancelled policies.
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REINSURANCE: The reserve amount included in the company’s financial statements for unearned premiums with respect to the insurance policies or reinsurance agreements as of a particular point in time. Unearned premiums are the sum of all the premiums representing the unexpired portions of the policies or reinsurance agreements which the insurer or reinsurer has on its books as of a certain date.

Insurance that covers off-the-job injury or sickness and is paid for by deductions from a person’s paycheck. This program is administered by a state agency and is sometimes also known as state disability insurance (SDI) and unemployment disability compensation (UDC) .

Regulatory model created by the National Association of Insurance Commissioners (NAIC) that established standards to prevent fraudulent or unethical practices in the insurance industry (e.g., misrepresentation, false advertising, misappropriation of policyholder’s money, twisting). States that have adopted the NAIC model may impose fines or revoke licenses of agents or brokers.

Trust established to distribute life insurance proceeds. Because insurance companies cannot act as trustees or guardians, the policy proceeds are paid to a trust company and distributed under the terms of a trust agreement creating greater flexibility in distribution of the proceeds. This type of arrangement is an unfunded life insurance trust.