Cancellation Clause
A provision in an insurance contract that permits the insurer or the
insured to cancel a policy at any time before its expiration date.
Capacity The largest
amount of insurance or reinsurance available from a company. It can
also refer to the largest amount of insurance or reinsurance available
in the marketplace.
Cash Surrender Value
The amount of money received when a policyholder surrenders a life insurance
policy with cash value.
Caveats
Conditions attached to an insurance quotation.
Cede
To transfer all or part of a risk written by an insurer to a reinsurer.
CII
Chartered Insurance Institute. A body controlling professional standards
(educational, ethical etc) in the insurance industry.
Claim
Notification to an insurance company that payment of an amount is due
under the terms of a policy.
Claims Experience
The relationship of claims to premiums for a period. Usually expressed
as a percentage or ratio.
Claims Reserve Amounts set aside by an insurer to
meet costs of claims incurred but not yet settled.
Co-insurance
An arrangement by which a number of insurance companies cover a particular
risk.
Conditions
Provisions in an insurance contract that state the rights and duties
of the insured and of the insurer.
Consequential Loss A financial loss occurring as
the result of some other loss. Also known as an indirect loss. (eg a
shop is destroyed by fire. The loss of the building, stock etc is a
direct loss. The loss of ongoing profit because of the inability to
continue trading is a consequential loss).
Continuation Option
Allows employees to continue their group insurance coverage under certain
conditions after their employment has terminated (much less common today).
Continuing Professional Development
A formal procedure by which a professional body ensures that its members
keep their expertise up to date with current developments. Applies to
doctors, lawyers, accountants, financial advisers etc.
Contract
A legally enforceable agreement between two parties
Convertible Term Insurance
Term insurance which can be changed into a permanent policy without
further evidence of insurability or medical examination.
Cooling Off Period
A period allowed in certain circumstances during which a person who
has entered into a contract (for example, an insurance policy or a personal
loan) may cancel it without incurring any penalty.
Cover Note
A temporary certificate confirming that an insurance policy is in force.
Used in motor insurance for taxation/registration purposes and in some
other contexts such as life assurance to confirm that cover is effective
on a temporary basis while further information is being gathered.
CPD
Continuing Professional Development.
Critical Illness Policy
A Critical Illness policy will provide a lump sum payment to the insured
should he or she be diagnosed as having one of a number of specified
illnesses, conditions or diseases.
Custom Excise
A government department responsible for the collection of duties on
imports, VAT and other taxes including Insurance Premium Tax.
