Market Cycles

Market-wide fluctuations in the prevailing level of insurance and reinsurance premiums. A soft market, i.e., a period of increased competition, depressed premiums, and excess capacity, is followed by a hard market—a period of rising premiums and decreased capacity.

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Minimum Premium

The least amount of premium to be charged for providing a particular insurance coverage. The minimum premium may apply in any number of ways such as per location, per type of coverage, or per policy.

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Non-Admitted Insurers

Insurance companies not licensed in a state may engage in business in the state if an admitted, properly filed company issues the policy and reinsures losses to the non-admitted reinsurer.

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Non-Subscriber Workers’ Compensation Plan

A non-subscriber is an employee who elects, by filing appropriate notices required by state insurance authorities, to pay work-related injury loss through some method other than statutory workers’ compensation.

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Occurrence

An adverse contingent accident or event neither expected nor intended from the point of view of the insured. With regard to limits on occurrences, property catastrophe reinsurance agreements frequently define adverse events having a common cause and sometimes within a specified time frame.

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Offset Clause

A condition in reinsurance agreements which allows each party to net amounts due against those payable before making payment.

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Outstanding Losses

Losses that have been reported to the insurer but are still in the process of settlement. Paid losses plus outstanding losses equal incurred losses.

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