Selected Core Resources



Sponsored by the BRASS Education Committee

Insurance

Maintained by
Malcolm Brantz
Araphoe Community College
Malcolm.Brantz@Arapahoe.edu

Scope | Important Terms | Frequently Asked Questions

   

Insurance is the business that provides protection to individuals and organizations against the threat of sudden and accidental loss. The main branches include fire insurance, travel insurance, household insurance, liability insurance, vehicle insurance, health insurance, and property insurance. For a short list of basic insurance web sites, see the Best of the Best Business Web Sites (Free Resources): Insurance.


   
All definitions are taken from Barron's Dictionary of Insurance Terms by Harvey Rubin,
Barron's Educational Series, Hauppauge, New York 2000.

All Risks Coverage - insurance that covers each and every loss except for those specifically excluded. If the insurance company does not specifically exclude a particular loss it is automatically covered. This is the broadest type of property policy that can be purchased.

Automobile Liability Insurance - coverage if an insured is legally liable for bodily injury or property damage caused by an automobile. Experts advise against driving an automobile without automobile liability insurance as a matter of common sense, and because state laws require such a policy as evidence of financial responsibility.

Business Insurance - coverage designed to protect against loss exposures of business firms, as opposed to those of individuals.

Collision Insurance in automobile insurance, coverage providing protection in the event of physical damage to the insured's own automobile resulting from collision with another inanimate object.

Commercial Health Insurance - coverage that provides two types of benefits, disability income, and medical expenses. Sold by insurance companies whose motive is the profit motive.

Comprehensive Insurance - coverage in automobile insurance providing protection in the event of physical damage (other than collision) or theft of the insured car.

Deductible - the amount of loss that insured pays in a claim.

Group Health Insurance - coverage underwritten on members of a natural group, such as employees of a particular business, union, association, or employer group. Each member is entitled to benefits for hospital room and board, surgeon and physician fees, and miscellaneous medical expenses.

Health Maintenance Organization - prepaid group health insurance plan that entitles members to services of participating physicians, hospitals, and clinics. Emphasis is on preventive medicine. Members of the HMO pay a flat periodic fee for these medical services.

Homeowners Insurance - package policy that combines coverage of the insured's property being destroyed or damaged by various perils, and coverage for liability exposure of the insured. Homeowners policies cover both individuals as well as property.

Indemnity - compensation for a loss.

Liability Insurance - coverage for all sums that the insured becomes legally obligated to pay because of bodily injury or property damage, and sometimes other wrongs to which an insurance policy applies.

Life Insurance - protection against the death of an individual in the form of payment to a beneficiary usually a family member, a business, or institution.

Named Peril Policy - insurance contract under which covered perils are listed. If an unlisted peril strikes no benefits are paid.

Premium - rate that an insured is charged, reflecting his or her expectation of loss or risk. The insurance company will assume the risks of the insured in exchange for the premium payment.

Reinsurance - form of insurance that insurance companies buy for their own protection, "a sharing of insurance." An insurer reduces its possible maximum loss on either an individual risk or a large number of risks by giving a portion of its liability to another insurance company.

Rider - endorsement to an insurance policy that modifies clauses and provisions of the policy, including or excluding coverage.

Risk - uncertainty of a financial loss; term used to designate an insured or peril insured against.

Risk Management - procedure to minimize the adverse effects of a possible financial loss by identifying potential sources of loss ; measuring the financial consequences of a loss occurring; And using controls to minimize actual losses or their financial consequences.

Social Insurance - compulsory employee benefit plan under which participants are entitled to a series of benefits as a matter of right.

Underwriting - process of examining, accepting, or rejecting insurance risks, and classifying those accepted, in order to charge the proper premium for each. The purpose of underwriting is to spread the risk among a pool of insured in a manner that is equitable for the insured and profitable for the insurer.

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    How do I shop for insurance?

Visit websites for major insurance providers and compare insurance prices, options, and coverage using online tools. Some examples:

Insure.Com
 
InsWeb
 
eSurance
 
eHealthInsurance
 
Yahoo Insurance
 
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    Where can I learn what insurance policies generally cover?

Be careful when you review coverages. In many cases, it's better to check with your carriers agent or claim department.

Motely Fool Insurance Center

The basics about why insurance is important and the main kinds of insurance for property, life, and employment. Includes advice on buying, finding agents, pricing, and industry websites.
 
Who Writes What in Life and Health Insurance (Chicago: National Underwriter Co.).

This annual supplement to the National Underwriter magazine provides detailed policy and coverage information for life and health insurance.
 
Best's Aggregates and Averages. Life/Health and the Best's Aggregates and Averages. Property/Casualty (Oldwick, N.J.: A.M. Best)

Annual benchmarking editions include lists leading companies for various lines of insurance underwriting. Aggregated data and statistical indicators for evaluating the financial ratios, premiums, and losses for individual companies or entire groups.

CPCU Handbook of Insurance Policies 7th ed. (Malvern, PA: American Institute for Chartered Property Casualty Underwriters ; Insurance Institute of           America)

Text usd by AICPCU for training courses on property and casuality insurance./p>

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    How can I learn about liabilities and risks for a particulary kind of business?

Insuring Your Business (New York: Insurance Information Institute)

This guide helps small business owners decide what kinds of insurance they need for their particular enterprise.

Best's Underwriting Guide (CDROM) ( Oldwick, NJ : A.M. Best)
Descriptions of 570 business operations, including non-profits, to help evaluate the kinds of risks and policies needed for property, equipment, and employees. Profiles enterprises in the service industries, manufacturing sector, contractors, suppliers, and retailers. Includes hazard ratings, related businesses, hazards associated with equipment and materials, general liability, automobile liability, professional liability, environment impairment, workers compensation, crime, fire and property damage, and risk due to business interuptions. .
 
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    How can I research insurance companies and how they are rated?

Insurance ratings are the report cards for the industry. Ratings measure an insurance company's financial strength, operating performance, and ability to meet the obligations of their policyholders. Some rating sources are available online and in libraries. Major rating services include A.M. Best, Standard & Poors, Merchants/Moody's, and Fitch:

Best's Insurance Reports. Life-Health and the Best's Insurance Reports. Property-Casualty. (Oldwick, N.J.: A.M. Best Co.)

A.M. Best.com publishes regular reports on insurance companies that profiles their finances and assigns rating. vides the most famous rating service for insurance companies in the United States. These annual directories list insurance companies and assigns them letter grades for different segments of their operation. The reports also provide directory and financial information about different insurers.

Insurance Forum (Ratings Issue)

Published monthly, the Insurance Forum is a general newsletter for the industry. The Special Ratings issue contains comparisons of ratings assigned to U.S. and Canadian insurance companies by A. M. Best, Fitch, Moody's, and Standard & Poor's and includes a discussion of various rating systems used by these services. Separate lists Lists life-health companies that show signs of difficulty and provides a suggested list of more conservative companies for consumers.

Mergent Moody's Bank & Finance Manual, Volume 2 (New York: Moody's Investment Services).

Profiles of large insurance companies with financials statements and the Moody's rating information. All aspects of the insurance industry are covered, with detailed statements on a comparative basis. It provides basic financial statements, and Moody's rating information for insurance companies. Available online as the Mergent Online database (minus the ratings).

Standard & Poor's Insurance Rating Service (New York: McGraw-Hill).

Provides ratings for financial strength, solvency, credit, and claims paying ability of insurance organizations. S&P covers over 2,500 insurers for life, property-casualty, and health insurance lines. As with Best ratings, S&P ratings are prestigious.

TheStreet.com Ratings' Guide to Life and Annuity Insurers (Millerton, NY: Grey House Publishing)

Quarterly (or annual) publication that provides basic ratings and profiles aimed at helping evaulate companies that offer life insurance policies and annuities. Includes a section of recommendations and ratings of companies by state. Annual edition is also published.

TheStreet.com Ratings' Property & Casualty Insurers (Millerton, NY: Grey House Publishing)

Quarterly analysis on more than 2,800 U.S. insurance companies, offering auto & homeowners insurance, business insurance, worker’s compensation insurance, product liability insurance, medical malpractice and other professional liability insurance.

TheStreet.com Ratings' Guide to Health Insurers (Millerton, NY: Grey House Publishing)

Financial profiles of more than 6,000 health maintenance organizations (HMOs) and all of the Blue Cross Blue Shield plans. Available as a quarterly or annual edition.

 

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    How can I find general information about the insurance industry?

Insurance Information Institute Media Resources
 
Source of information for industry issues, statistics, market size, financials, outlook, analysis, and other research on the insurance industry. The Insurance Fact Book includes trends and statistics on the insurance industry as a whole with a special emphasis on losses, market overviews of the industry, factors affecting costs, losses by category, laws affecting motorists, premiums. Print copies of the Insurance Fact Book, the Financial Services Fact Book, and the International Fact Book can also be ordered from http://www.iii.org/media/publications

Life Insurers Fact Book    American Council of Life Insurers

Statistics and information on trends in the life insurance industry. Specific topics covered include assets, liabilities, income, expenditures, reinsurance, life insurance, and annuities. Print version is available as a free download


U.S. Census Health Insurance Data
Data on health insurance coverage, reports, working papers, coverageBrings together all the Census data collected on health insurance.
 
Standard & Poor's Industry Surveys (New York: McGraw-Hill)
Overviews of how the insurance industry operates, leading companies, trends, and other background information with separate reports for Life & Health and Property-Casualty. Available online via the the S&P NetAdvantage database.
 
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    What are the main trade journals for the insurance industry?

Best's Review. (Oldwick N.J.: A.M. Best Co.).

This monthly magazine reports on news and issues in the insurance industry.

BestWeek. (Oldwick N.J.: A.M. Best Co.).

A weekly newsletter providing the latest news and analysis on the industry. Some issues also include rating monitors and statistical studies.


Business Insurance (Chicago: Crain Communication).
Trade magazine for the insurance industry..
 
National Underwriter. Life, Health/Financial Services ed. and the Property & Casualty/Risk Management ed. (Chicago: National Underwriter Co.)
 
Weekly publications are famous news source in the industry. News and trends are covered with considerable analysis and detail.

CPCU Journal (Malvern Pa: Society of Chartered Property and Casualty Underwriters).
A quarterly journal with a strong property insurance focus. Articles are highly technical.
 
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    What databases cover insurance journals and trade publications?

Business Source Premier (Ebsco)

ABI/Inform (Proquest).

Business & Industry (Gale)

General Business File, Business & Industry (Gale)

Lexis-Nexis Academic

Factiva (Dow Jones)

SilverPlume
 
Vendor of information from major publishers such as A.M. Best, Institutional Risk Management Institute, National Underwiriter Company, and the Insurance Services Office serving insurance professionals, consultants, and human resource managers.
 
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    What are some guides to researching the insurance industry?

Encyclopedia of Business Information Sources (Detroit: Gale Research).

Published annually, this is a standard title for library business collections. The book covers many types of insurance, as well as related concepts like risk management and insurance law. For each type, it lists directories, almanacs, databases, directories, handbooks, periodicals, statistical sources, associations, and more.

Directory of Business Information Resources (Millerton: Grey House)

Published annually; covers associations, newsletters, magazines & journals, trade shows, directories & databases, and industry web sites.

 

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    What are some dictionaries for insurance?

Financial Times Dictionary of Insurance, 2nd ed. (New York: Prentice Hall, 2004.)

Useful for both professionals and consumers.

Dictionary of Insurance Terms (New York: Barrons Educational , 2008)

Useful for both professionals and consumers. Icons next to each term quickly identify the term's general category (ex. annuities, automobile, aviation, etc.)

Dictionary of health insurance and managed care (New York: Springer, 2006)
 
.
NILS INSource Glossary

Free dictionary sponsored by publisher website.

 
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    What are some other professional resources for learning about insurance and risk management?

Fundamentals of Risk and Insurance (New York: Wiley, 2002)

Principles of risk management and insurance. 10th ed. ( Boston: Pearson/Addison Wesley)

Professional associations with information and publications:

American Council of Life Insurance 1001 Constitution Avenue, NW, Washington, DC 20004-2599. (202) 624-2000.

American Insurance Association 1130 Connecticut Ave. NW, Washington, DC 20036. (202) 828-7100.

A national trade association for writers of property/casualty insurance.

American Institute for Chartered Property Casualty Underwriters and the Insurance Institute of America 720 Providence Rd., Malvern, PA

The largest professional association in the insurance industry committed to education and high ethical standards in the industry. Courses and professional literature are found in the Institutes' Professional Development Catalog.

Independent Insurance Agents and Brokers of America 127 S. Peyton St., Alexandria, VA 22314

Insurance Information Institute

International Risk Management Institute 545 Washington Boulevard, Jersey City, NJ 07310-168

Insurance Services Office 545 Washington Boulevard, Jersey City, NJ 07310-1686

National Association of Insurance Commissioners 2301 McGee Street, Suite 800, Kansas City, MO 64108-2662.

NAIC represents U.S. insurance regulators from the 50 states, the District of Columbia and the four U.S. territories.

National Association of Health Underwriters 2000 North 14th St., Suite 450, Arlington, VA 22201 >/dd>

National Association of Professional Insurance Agents 400 N. Washington Street, Alexandria, VA 22314.

Supports educational and statistical programs for agents, and promotes professional and ethical standards for insurance sales practices.

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Last updated 12/22/08
Previously maintained by:
Van Houlson, University of Minnesota - Twin Cities
Steven Cramer, University of North Carolina - Greensboro
Originally created by Joseph E. Straw, University of Akron

Sponsored by the BRASS Education Committee