The Institutes Glossary


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An occupancy hazard category consisting of apartments, hotels, motels, and nursing homes and that presents a wide variety of common and specialized hazards.
A theory that considers accidents as resulting from mechanical failures.
Set of international rules for the carriage of goods, particularly defining the carrier’s and shipper’s duties and obligations.
Small, rounded ice pellets that often form during thunderstorms.
A perceptual distortion that occurs when a person uses a positive or negative attribute to form an overall impression of another person.
An automatic fire sprinkler system in which halocarbons are used to disrupt the chemical reaction of fire; commonly used in computer rooms and magnetic-tape storage vaults.
A series of ionized hydrocarbon gases and liquids (halogenated hydrocarbons) that have the ability to halt chemical reactions and thus extinguish fires rapidly.
The coverage that insures an airport or fixed base operator against liability resulting from physical damage to aircraft in the insured’s care, custody, or control for safekeeping, storage, service, or repair.
A withdrawal right up to the full applicable annual exclusion that will lapse if not exercised within a specified period, but only to the extent of the lapse-protected amount for that year.
A tangible item that is easily audited.
Actions that are undertaken deliberately to defraud.
Merchandise made principally from glass, metal, and china, which can be cleaned after exposure to smoke or water.
Market conditions in which insurer competition diminishes, buyers have difficulty finding coverage, premiums increase, and insurer profitability rises.
The limitation of capital available for investment as a result of external constraints.
An exception to the application of a zoning ordinance for lots that, because of size, topography, or other physical limitations, do not conform to the ordinance requirements for the zone.
A physical machine and all of its component parts and cables.
Wood that comes from deciduous, broadleaf trees such as maple and oak.
A federal statute that governs a common carrier’s liability for goods shipped by water between points in the United States.
A corporate-level strategy through which a company seeks to gain short-term profits while phasing out a product line or exiting a market.
A condition that increases the frequency or severity of a loss.
A method of analysis that identifies conditions that increase the frequency or severity of loss.
A grouping of injuries classified according to their relative occupational injury severity, used in workers compensation retrospective rating.
Risk from accidental loss, including the possibility of loss or no loss.
A classification of bonds that guarantee compliance with EPA and state laws for the closure and post-closure care of hazardous waste facilities.
A vessel somewhat larger than a charter boat, whose passengers pay a fare for partial-day or full-day fishing excursions; may carry from twenty to several hundred passengers.
Federal legislation establishing standards for health insurance information exchanges and health coverage protection when jobs are lost or changed.
An organization that provides all the care needed by its members in exchange for a fixed fee.
An employer-funded medical savings account that reimburses employees for medical expenses not covered by the employer's group insurance plan; distributions to the employee are tax deductible to the employer, and employee reimbursements from the employer are considered tax free.
A medical savings account available to consumers enrolled in a high-deductible health plan; the funds contributed to the account are not subject to federal income tax at the time of deposit.
Legislation that required contractors on public works to post a surety bond and promptly make payments for labor and materials; it was replaced by the Miller Act.
Secondhand information that a witness testifying in court heard from someone else but did not personally see or hear.
The rule of evidence that prevents the admission of out-of-court statements not made under oath by a person who is unavailable to testify.
A type of detector wired to a local alarm, remote, or central station system that sounds alarms under ­abnormal heat conditions.
A unit that can act as an air conditioner and can reverse itself and draw heat from the outdoors to heat the inside of a house.
A type of construction used for highways, bridges, dams, roads, railroad beds, and similar projects.
A type of joisted masonry construction that is considered more fire resistant than typical joisted masonry construction.
A CLM vehicle size classification for trucks with a gross vehicle weight (GVW) of 20,001 pounds to 45,000 pounds.
A CLM vehicle size classification for trucks with a gross combined weight (GCW) of 45,000 pounds or less.
A financial transaction in which one asset is held to offset the risk associated with another asset.
Damages associated with the loss of physical and intellectual gratification and other lifestyle losses.
A theory that states an unsafe act began the chain of events that ultimately led to the injury.
A layer in a neural network in which neurons learn and recode information received from input data.
A modeling technique in which multiple clusters are grouped according to their similarities.
A risk that requires high limits of insurance that may exceed the underwriting criteria of admitted insurers.
An agreement in arbitration that stipulates that no matter what the arbitrator decides, the insurer will not pay more than the high specified amount and the claimant will not receive less than the low specified amount. The high and low are decided in advance and expressed as a range.
A large property whose construction meets high standards of risk mitigation and control characteristics and whose management maintains best practices loss control and risk mitigation techniques for the specific occupancy.
Any structure taller than seventy-five feet (National Fire Protection Association definition), or a building taller than the tallest ladder available to the fire service.
A clause in a bill of lading in which the cargo liability limitations available to carriers are extended to terminal operators and stevedores.
The total replacement of the hip joint with an artificial prosthesis.
An auto that the insured leases, hires, rents, or borrows, excluding autos leased, hired, rented, or borrowed from employees, partners, LLC members, or members of their households.
Autos leased, hired, rented, or borrowed, but not from employees or partners or members of their households.
A plot of a distribution of observations with the horizontal axis representing the class intervals and the vertical axis representing the frequency or probability of outcomes.
The original cost of a property.
The ratio of insurance policies written to those that have been quoted to applicants for insurance.
A vehicle whose operator cannot be identified.
Lowest-cost coverage for owner-occupants, providing specified perils coverage only.
Coverage for owner-occupants, providing open perils coverage on buildings and specified perils coverage on personal property.
Coverage for tenants, providing specified perils coverage on personal property.
Coverage for owner-occupants, providing open perils coverage on buildings and personal property.
Coverage for owner-occupants of condominium units, providing specified perils coverage on personal property and building items.
Coverage for owner-occupants of dwellings not meeting HO standards, providing specified perils coverage only.
The person to whom a negotiable instrument has been issued or endorsed and who possesses it for value, in good faith and without notice that it may not be valid, can be claimed by another, is overdue, or was previously dishonored.
A contractual provision that obligates one of the parties to assume the legal liability of another party.
The length of time an asset is owned, which generally determines whether the capital gain is subject to taxation as a long- or short-term capital gain.
In the model training process, existing data with a known target variable that is not used as part of the training data.
A tenant who has a lease for a number of years and, at the expiration of the lease, continues to occupy the premises.
A type of burglar alarm situated so that it can be triggered by a bank teller or store clerk during a robbery, sending an alarm signal to a central station company or the police.
Policy that covers most of the property and liability loss exposures that arise out of residential property ownership and occupancy, as well as property and liability loss exposures that individuals and families may have while they are away from their residences.
Units of exposure that face approximately the same expected frequency and severity of loss.
The tendency of people to connect to others who are similar to them.
In linear modeling, variance of the model errors around the estimated mean of the target variable is the same regardless of its size.
An examination to detect symptom magnification or fabrication of pain. The patient lies on the back, and the examiner places one hand under each heel while the patient lifts one leg and keeps the knees straight. A patient who does not lift the leg, or tries to lift the leg but the examiner does not feel pressure on the opposite heel from the other leg trying to “help” the weaker one, is probably not trying.
A combination of two companies in the same line of business.
The use of the period-to-period percentage changes identified in common-size statements to identify trends.
An analysis of services ordered by the doctor, services actually performed by the hospital, and services billed by the hospital to ensure the appropriateness of hospital charges.
Insurance that covers medical expenses while the patient is in the hospital, such as daily room-andboard and miscellaneous expenses incurred during the hospital stay.
A medical professional who develops a patient’s nursing care plan, including an assessment of basic needs, nutritional intake, elimination needs, skin care, and the delivery of medications.
The type of liability assumed by hosts who entertain and serve alcoholic beverages to their social guests.
Coverage for a person or an organization that serves alcoholic beverages to others but is not in the alcoholic beverage business; it covers the insured host against liability for accidents caused by persons who become intoxicated as a result of the insured’s serving of alcoholic beverages.
An employment discrimination claim in which the plaintiff alleges sexual discrimination because his or her refusal to submit to sexual advances resulted in abusive conduct or an otherwise hostile work environment.
A fire that leaves its intended place, such as a spark that escapes a fireplace and sets the carpet on fire.
A witness whose response to the insured is more than just unfriendly, but also adverse. Usually, an attitude of bias or prejudice is displayed against the insured or claimant because of race or nationality, occupation or position in society, physical features, or a dislike of his or her personality.
An environment that exists when an employee is subjected to harassment that is so severe or pervasive that it alters the conditions of his or her employment and creates an abusive working environment.
A loss control technique for computer security in which a third party keeps a compatible computer installed and running twenty-four hours a day for emergency users.
A fee arrangement in which defense lawyers charge the client by the hour for services provided.
A service such as cooking or cleaning.
Property insurance that covers large property risks with superior loss protection characteristics; has broader coverage than most commercial property policies and usually a lower premium rate.
Insurance that covers physical damage to vessels, including their machinery and fuel but not their cargo.
An approach to risk control that attacks the problem by modifying the behavior of people to reduce the frequency of unsafe acts.
A process that applies the knowledge of human behavior to design equipment people use on and off the job.
Has three economic phases: growth and education phase—birth to age twenty-two; work or net savings phase—end of the education phase until retirement (unless a couple has children, in which case the phase ends when the children are through the education phase); and the net consumer phase.
A mathematical computation used to determine how much life insurance is needed by valuing a human life.
A sensor that detects, measures, and reports relative humidity.
A severe tropical storm with winds exceeding seventy-four miles per hour.
An organizational structure in which divisions combine elements of other organizational structures.
The satisfaction derived from the conditions of the job (job context), according to Herzberg’s Two-Factor Motivation Theory.
High blood pressure.
A standard to tag page layout elements in a web document.
An impaired or a decreased sensitivity to touch.
A somatoform disorder characterized by the fear of, or belief that one has, a serious illness, despite an absence of physical evidence.