Small Business Guide To Commercial Insurance

37 Judgment Rating A rating modification (either decrease or increase) that is based on the underwriters experience, best judgment, and analysis in classify- ing and underwriting a particular type of risk. Lapse In property and casualty insurance a lapse in the termination of a policy because of a failure to pay premium when due. Liability Insurance Coverage for a policyholder’s legal liability resulting from injuries to other persons or damage to their property. License A certificate of authority issued by the CDI to an insurer, agent, broker, or broker-agent to transact insurance business. The maximum amount of benefits the insurance company agrees to pay in the event of a loss. Loss of Consortium A potential situation in any bodily injury claim (including Workers Compensation claims) where a spouse contends that the bodily injury of their partner deprives them of the natural affection (spousal duties), help, and companionship of said spouse. Loss Payable Clause A provision that authorizes the insurer to make a loss payment to a person, company, or organization (loss payee) other than the insured. The loss payee must have an insurable interest (such as a lienholder for business personal property or a mortgagee on real property). Managing General Agent (MGA) An agent contractually authorized by an insurance company to man- age all or part of the insurer’s business activities. An MGA can man- age the marketing, underwriting, policy issuance, premium collection, appointing and supervision of other agents, claims payments, and reinsurance negotiations of an insurance company.