Key concepts of commercial insurance, reinsurance and risk engineering – precisely defined and linked in the graph.
650 objects
The operative time of a group personal accident policy determines whether accidents are insured around the clock at work and in leisure time (24-hour cover) or only during occupational activity including business journeys and business travel (occupational-only cover).
24/7 travel assistance is the round-the-clock alarm and coordination centre of business travel accident insurance that organises medical advice, hospital referral, guarantees of payment, evacuations, security information and crisis support – usually delivered by specialised assistance providers such as International SOS or the insurer's own assistance company.
Abandonment is a right in marine insurance law allowing the policyholder to surrender the insured property to the insurer following a total loss, missing vessel, or governmental seizure, in exchange for the full sum insured.
Explained on the topic page Transport Insurance
Abfertigung is the Austrian statutory lump-sum severance payment due on termination of employment; since 2003 it has been funded through ongoing contributions to an employee provident fund (Abfertigung NEU).
The accident annuity (Unfallrente) is a monthly benefit agreed in private accident insurance, paid for life in the amount of the agreed annuity sum once the accident-related degree of disability reaches a specified threshold, commonly 50 per cent.
The accident year is the year in which an insured loss actually occurred, and forms the central axis of a claims triangle.
Explained on the topic page Actuarial
An accident-like bodily injury (unfallähnliche Körperschädigung, UKS) is one of the injuries exhaustively listed in Art. 6 para. 2 UVG – such as bone fracture, meniscus tear, tendon rupture or ligament lesion – for which Swiss mandatory accident insurance pays even where the statutory definition of accident is not met, unless the injury is predominantly attributable to wear and tear or illness.
Accidental death & dismemberment (AD&D) is an internationally common accident insurance benefit that pays the agreed principal sum on accidental death and a percentage of that sum, fixed in a schedule of losses, for the loss of limbs, sight, hearing or speech.
Accumulation risk is the danger that a single event simultaneously affects multiple insured risks, thereby causing a total loss that is economically significant for the insurer.
Explained on the topic page Reinsurance
Acquisition cost financing is the financing of a primary insurer's initially high acquisition costs through specially structured reinsurance arrangements, such as development quotas or finite quota shares.
Explained on the topic page Reinsurance
Acquisition costs are the costs incurred by an insurer to solicit and conclude insurance contracts, primarily commissions paid to intermediaries.
Explained on the topic page Accounting
Actual cash value (ACV) is the replacement cost of property less depreciation for age, wear or obsolescence, and forms the basis of indemnity in property insurance when cover is not written on a reinstatement-value basis.
The additional contribution is the fund-specific share of the premium that members of Germany's statutory health insurance (GKV) must pay on top of the general statutory contribution rate.
Explained on the topic page Health Insurance
The additional interest reserve (ZZR) is the part of the technical provision in life insurance that is set aside on top of standard reserves for future guaranteed-interest obligations during periods of low capital market rates.
Explained on the topic page Reserving
Adequate causation exists when an event, according to the ordinary course of things and general life experience, is suited to bring about or substantially favour an outcome of the kind that occurred.
The ADL (Activities of Daily Living) scale assesses the need for long-term care based on the ability to independently perform basic daily activities, and is used by health and life insurers to tier benefits.
The administrative fine provisions of the VAG empower the supervisory authority to sanction breaches by insurance undertakings and their officers of regulatory duties with fines.
Explained on the topic page Regulatory
The admission and satisfaction prohibition barred policyholders under former German law from acknowledging or settling liability claims without the insurer's prior consent.
Explained on the topic page Liability Insurance
The admission medical examination is a medical examination of an applicant required by the insurer to assess the risk to be insured before a contract is concluded.
Explained on the topic page Health Insurance
An advance payment bond secures a project owner's repayment of an advance payment made if the contractor fails to perform its contractual obligations.
An adverse development cover retrospectively protects a primary insurer against under-reserving of past claims, with the reinsurer assuming payments above an agreed attachment point.
Explained on the topic page Reinsurance
The advisory documentation record is the written record of an insurance advisory session, capturing the customer's demands and needs and the reasons for the recommendation given.
Explained on the topic page Distribution
The agency agreement governs the contractual relationship between an insurer and its insurance agent, including authority, remuneration, and duties.
Explained on the topic page Distribution
Agency subsidies are performance-independent payments made by an insurance company to insurance agents to support agency set-up, which are not offset against commissions.
Explained on the topic page Distribution
Authority to bind entitles an insurance agent to conclude insurance contracts on the insurer's behalf with immediate binding effect.
Explained on the topic page Distribution
An aggregate is the sum of a risk carrier's exposures under certain perils, calculated as the basis for a reinsurance arrangement, for example to determine an attachment point and limit.
Explained on the topic page Reinsurance
The aging reserve is a technical provision in private health insurance that offsets the age-related increase in healthcare costs and stabilizes premiums over the contract term.
Explained on the topic page Health Insurance
Aircraft impact is an insured peril in several property lines covering damage from an aircraft, its parts, or its cargo striking insured property.
Explained on the topic page Property Insurance
Alternative insurance models are special forms of Swiss basic health insurance with restricted choice of provider (Art. 41 para. 4 and Art. 62 KVG, Art. 99 et seq. KVV): insured persons undertake to contact their family doctor, an HMO centre or a telemedicine service first whenever they fall ill, and receive a premium discount in return.
Alternative reinsurance is the umbrella term for non-traditional forms of reinsurance products that go beyond pure risk transfer, such as financial reinsurance or ART.
Explained on the topic page Reinsurance
Alternative risk transfer refers to the transfer of insurance risk to the capital markets or to specialized risk carriers outside traditional (re)insurance.
Explained on the topic page Reinsurance
The annual annuity is the calendar-year amount of an annuity benefit from an annuity policy or a retirement system, used as the reference figure for actuarial calculation.
Explained on the topic page Life Insurance
An annual contract is an insurance contract with an initial term of one year that automatically renews for a further year unless terminated in due time by either contracting party.
Explained on the topic page Contract Law
The annual maximum benefit is the maximum amount agreed in health or supplementary insurance tariffs up to which the insurer reimburses costs for certain types of benefits within one policy year.
Explained on the topic page Health Insurance
The annual premium is the premium agreed for a full policy year, serving as the reference figure for calculating installment surcharges when premiums are paid at intervals shorter than a year.
Explained on the topic page Contract Law
Annual surplus is an insurer's positive annual result determined under statutory or IFRS accounting rules, forming the basis for profit distribution, reserve allocation, and policyholder surplus participation.
Explained on the topic page Actuarial
The any one accident limit is the maximum amount agreed in group personal accident policies that the insurer will pay for all insured persons affected by the same accident or the same original cause; if individual claims exceed the limit, they are reduced proportionately. Separate scheduled and non-scheduled aircraft accumulation limits frequently apply to air travel.
The appointed actuary is a statutorily required function at German life and health insurers, responsible for ensuring compliance with actuarial principles in pricing and reserving.
Explained on the topic page Regulatory
The area of cover is the geographical territory defined in an international health insurance contract within which treatment is reimbursed – typically "Worldwide" or "Worldwide excluding USA", with some insurers offering regional zones – and one of the most important premium drivers in IPMI.
Asset allocation is the strategic distribution of an investment portfolio across different asset classes to optimize return and risk.
Explained on the topic page Investments
Asset backed securities are securities collateralized by a pool of receivables or other assets, with payments to investors serviced from the cash flows they generate.
Explained on the topic page Investments
Asset liability management is the integrated management of an insurer's investments and liabilities to limit interest rate, liquidity, and duration mismatch risks.
Explained on the topic page Investments
Asset liability modelling is the simulation-based analysis of the interaction between an insurer's investments and liabilities under various capital market and business scenarios.
Explained on the topic page Investments
Asset management is the professional management of investments on behalf of investors, including investment decisions, monitoring, and reporting.
Explained on the topic page Investments
Asset-liability mismatch risk is the risk that an insurer's investments and liabilities do not sufficiently align in terms of maturity, interest rate sensitivity, or currency.
Explained on the topic page Investments
Assignment as collateral refers to the contractual restriction that ties disposal of an insurance benefit to the consent of a third party, usually a lender, in whose favour the policy has been pledged or assigned as security.
In an assignment as security, the claims arising from a life insurance policy are pledged as collateral for a third party's claim (e.g. a bank), without the policyholder changing.
Assignment is the contractual transfer of a claim, such as a claim to an insurance benefit, from the existing creditor to a new creditor.
Explained on the topic page Contract Law
Assumed reinsurance is the offering of reinsurance capacity and the underwriting of reinsurance covers by a reinsurer, as opposed to ceded reinsurance from the cedent's perspective.
Explained on the topic page Reinsurance
The ASVG is the central Austrian statute governing statutory social insurance and regulates health, accident, and pension insurance for employees within a single act.
Financial instruments measured at fair value through profit or loss (FVTPL) are remeasured to fair value at each balance sheet date, with changes recognized immediately in profit or loss.
Explained on the topic page Accounting
The ATA Carnet is an internationally standardised customs document that enables the temporary, duty-free import, export and transit of goods such as trade fair exhibits, professional equipment or commercial samples across more than 80 contracting countries.
The attachment point is the loss amount above which a reinsurer becomes liable to respond under a non-proportional reinsurance cover.
Explained on the topic page Reinsurance
The AUVA is the statutory carrier of accident insurance under the ASVG and covers work-related and occupational accidents as well as occupational diseases of employees in Austria.
Available for Sale was a financial instrument classification under IAS 39 under which fair value changes were recognized in other comprehensive income rather than in profit or loss.
Explained on the topic page Accounting
An aval is a guarantee or surety bond issued by a bank or credit insurer on behalf of a customer in favor of a third party, without any cash changing hands.
Avalanche is a natural hazard peril in which falling masses of snow or ice damage buildings, infrastructure, and people, and is offered in mountainous regions as an extension of natural hazard cover.
The average claim amount is the ratio of total claims payments to the number of claims within a given period or portfolio.
Bad faith describes blatantly unfair conduct by an insurer in handling a claim that exceeds mere breach of contract and can give rise to damages claims beyond the policy limit.
BaFin is Germany's supervisory authority for banks, insurers, and securities services providers, overseeing insurance undertakings at the federal level under the VAG.
Explained on the topic page Regulatory
The balance sheet date is the point in time to which the valuation of all assets and liabilities in an insurer's financial statements refers.
Explained on the topic page Accounting
The Basic Tariff is a statutorily mandated tariff in German private health insurance offering benefits comparable to statutory health insurance, with a mandatory acceptance obligation for insurers.
Explained on the topic page Health Insurance
Basis risk is the risk that a hedge — particularly a parametric or index-based instrument — does not precisely match the actual loss suffered.
Explained on the topic page Reinsurance
The Basisrente is a state-subsidized German private pension plan providing lifelong annuity payments that cannot be inherited, pledged, or transferred.
Explained on the topic page Retirement Provision
A benchmark is a reference standard, typically an index, against which the performance of an investment or portfolio is measured.
Explained on the topic page Investments
The beneficiary is the person designated by the policyholder to receive the insurance benefit upon a covered event, without being a party to the contract themselves.
Explained on the topic page Life Insurance
A beneficiary designation determines which person receives the benefit from a life insurance policy on survival or death, and can be granted on a revocable or irrevocable basis.
Benefit escalation is a contractual provision under which an ongoing annuity benefit (e.g., from disability or pension insurance) is periodically increased by a fixed percentage or in line with inflation.
Explained on the topic page Life Insurance
Benefit reduction for gross negligence is the statutory curtailment of the insurance benefit where the insured person has brought about the insured event through gross negligence; in Switzerland it is applied under Art. 14 VVG in proportion to the degree of fault and, under Art. 37 UVG, for non-occupational accidents by reducing daily allowances during the first two years.
Berufsgenossenschaften are the industry-based, self-governing carriers of statutory accident insurance in Germany under § 114 SGB VII; they are financed exclusively by employers' contributions on a pay-as-you-go basis, calculated according to the funding requirement, the payroll and the hazard classes of the hazard tariff (§§ 150–157 SGB VII).
The Best Estimate is the probability-weighted average of the future cash flows of an insurance portfolio and the central valuation component of technical provisions under Solvency II.
Explained on the topic page Actuarial
A bid bond protects a tender issuer against a bidder withdrawing its offer before the bid validity period expires or failing to accept the award.
A binder is a preliminary, often informally issued insurance undertaking that provides coverage before the final policy has been issued.
Explained on the topic page Contract Law
The binding period is the time during which an offer or a reinsurer's underwriting commitment remains binding before it lapses without acceptance.
Explained on the topic page Reinsurance
A blanket policy establishes a single overall sum insured covering several insured objects or risk types, without dividing it among the individual items.
A block policy is a master cover that automatically insures an indeterminate number of similar individual risks or shipments under uniform terms.
Explained on the topic page Transport Insurance
Bodily injury is harm to a person's health or physical integrity, ranging up to death, and forms, alongside property damage, the central category of loss in liability insurance.
Explained on the topic page Liability Insurance
The bonus-malus system tiers motor insurance premiums based on the policyholder's individual claims history.
Book value is the value of an asset recognized in the balance sheet, typically the acquisition or production cost less accumulated depreciation.
Explained on the topic page Accounting
A bordereau is a periodic statement through which a cedent provides its reinsurer with details of individual ceded risks, premiums, or claims.
Explained on the topic page Reinsurance
The declaration process is the periodic reporting of individual risks written by the cedent under a proportional reinsurance treaty to the reinsurer.
Explained on the topic page Reinsurance
Breakage damage is the sudden mechanical destruction of a machine part or a glass surface and is the central insured event in machinery and glass insurance.
Explained on the topic page Property Insurance
Broker's authority is the mandate granted by the policyholder that authorizes an insurance broker to represent them toward insurers within a defined scope, without the broker acting on behalf of an insurer.
Explained on the topic page Distribution
Broker's professional liability refers to the civil liability of an insurance broker toward its client for damage arising from defective advice, placement, or ongoing servicing.
Explained on the topic page Distribution
Brokerage commission is the remuneration paid by an insurer to an insurance broker for placing and servicing an insurance contract.
Explained on the topic page Distribution
Building owner's liability is the causal liability of the owner of a building or other structure for losses arising from a defective condition or inadequate maintenance of the structure.
A bundled policy combines several legally independent insurance lines into a single policy with a unified premium invoice.
Explained on the topic page Property Insurance
The burden of proof determines which contracting party must prove the factual requirements for the existence or non-existence of an insurance claim.
Explained on the topic page Contract Law
Burglary is theft in which the perpetrator gains access to the policyholder's premises by overcoming an obstacle.
Explained on the topic page Property Insurance
Burning cost is an experience-based reinsurance pricing method that relates the historical loss experience of a portfolio to its premium base.
Explained on the topic page Reinsurance
Business closure insurance covers loss of income resulting from an officially ordered closure or restriction of operations, particularly due to infection control measures.
Capacity is the maximum amount of liability an insurer, reinsurer or the overall market can or will provide for a risk or a line of business.
Explained on the topic page Underwriting
Capacity for tort is a person's ability to be held civilly responsible for fault-based damage caused, and a prerequisite for liability.
Explained on the topic page Liability Insurance
The Cape Cod method is an actuarial reserving technique that combines the chain ladder method with a stabilizing expected loss ratio derived from the entire portfolio.
The capital funding method is a funded financing approach for retirement systems in which sufficient capital is accumulated from the outset for each accrued pension entitlement.
Explained on the topic page Retirement Provision
A capitalization requirement obliges a company to recognize certain expenditures as an asset on the balance sheet rather than expensing them immediately.
Explained on the topic page Accounting
A captive is a group-owned insurance or reinsurance company that primarily underwrites risks of its own corporate group, thereby financing a structured retention.
Explained on the topic page Risk financing
The care credit is a notional additional income credited when calculating AHV pensions for individuals who care for close relatives with a recognised degree of helplessness.
Explained on the topic page AHV
Cargo refers to the goods being transported, whose damage or loss forms the central insured event in marine and transport cargo insurance.
Explained on the topic page Transport Insurance
Carrier's liability is a transport company's statutory liability for loss of or damage to goods accepted for carriage.
Explained on the topic page Transport Insurance
Case management is the coordinated, individualized support of claims cases aimed at faster recovery, reintegration, or appropriate care for the insured.
Explained on the topic page Health Insurance
A cash call is a cedent's request to its reinsurer for early payment of an already foreseeable claims share ahead of the regular settlement cycle.
Explained on the topic page Reinsurance
A cash deposit is collateral placed by a reinsurer with the cedent to secure the cedent's claims under the reinsurance contract.
Explained on the topic page Reinsurance
Cash flow matching is an investment strategy aligning the timing and amount of investment cash flows with expected future insurance benefit payments.
Explained on the topic page Investments
The cash reserve is the holding of immediately available liquid funds that an insurer maintains to meet short-term payment obligations.
Explained on the topic page Investments
A catastrophe bond is a security through which insurers or reinsurers transfer catastrophe risk to capital market investors in exchange for a coupon.
A Cat XL is a non-proportional reinsurance treaty that protects a cedent against the accumulated loss burden from a single natural catastrophe event.
Explained on the topic page Reinsurance
A catastrophe model simulates the frequency and severity of natural catastrophe events and their expected losses to an insured portfolio.
Causal liability is a liability regime in which liability arises independently of the tortfeasor's fault, based solely on the existence of a legally defined causal link between a cause and the loss.
Causation is the causal link between an event or conduct and a loss that has occurred, the establishment of which is central both to founding liability and to reviewing coverage under an insurance contract.
Explained on the topic page Liability Insurance
The cedent is the primary insurer that transfers (cedes) all or part of the risks in its portfolio to a reinsurer.
Explained on the topic page Reinsurance
The Central Call Service of Motor Insurers is a facility run by the German Insurance Association (GDV) and German motor insurers that provides accident victims with free information on the motor liability insurer of a vehicle involved in an accident, where a legitimate interest exists.
The central limit theorem states that the distribution of the standardised mean of a large number of independent, identically distributed random variables can be approximated by the standard normal distribution, and it underpins risk pooling within a collective.
Explained on the topic page Risk theory
Cession is the transfer of a risk or a share of risk by the primary insurer (cedent) to a reinsurer (reinsurer/cessionary) in exchange for a reinsurance premium.
Explained on the topic page Reinsurance
The cession limit is the maximum share of a risk or contract that a reinsurer agrees to accept from a cedent under a reinsurance treaty.
Explained on the topic page Reinsurance
The chain ladder method estimates ultimate claims cost by projecting historical development patterns from a claims triangle onto the as-yet unresolved accident years.
The child-raising credit is a notional additional income credited to parents for years with children under 16 when calculating their AHV pension, offsetting disadvantages caused by child-raising duties.
Explained on the topic page AHV
A chronic illness is a long-lasting, generally not fully curable disease that is subject to special underwriting and benefit rules in health, disability, and long-term care insurance.
Explained on the topic page Health Insurance
Churning refers to the improper replacement of an insurance contract, driven primarily by an intermediary's commission interest, without economic benefit to the customer.
Explained on the topic page Distribution
Civil commotion refers to violent disturbances by a crowd within a state that can be included in or excluded from property insurance policies as a distinct peril.
Explained on the topic page Property Insurance
Beihilfe is the employer allowance paid by the state to civil servants and their dependents toward medical costs, typically supplemented by private complementary health insurance.
Explained on the topic page Health Insurance
Claims settlement speed is the time between receipt of a claim and completion of its handling, and serves as a quality metric for an insurer's claims service.
Explained on the topic page Claims management
A claims triangle is a tabular presentation of an insurer's historical claims costs or payments by accident year and development year, forming the basis of classical actuarial reserving methods.
Explained on the topic page Actuarial
The claims-made principle makes coverage of a loss dependent on the claim first being asserted against the insured during the current policy period.
Explained on the topic page Liability Insurance
A claims-sharing agreement is an arrangement between insurers under which, for certain loss scenarios with unclear or disputed liability shares, an individual case review is waived and the loss is split according to a fixed formula.
A clash cover protects a reinsurer or cedent against the accumulation of losses from multiple lines or policies triggered by the same loss event.
Explained on the topic page Reinsurance
Cliquet crediting permanently locks in annual gains of a fund- or index-linked life insurance policy so that they cannot subsequently be lost.
Explained on the topic page Life Insurance
Co-payments are additional payments by insured persons, over and above their normal contributions, required to access certain benefits under Germany's statutory health insurance (GKV).
Explained on the topic page Health Insurance
The coefficient of variation is the ratio of the standard deviation to the expected value of a distribution and measures the relative volatility of a risk.
Explained on the topic page Actuarial
Coinsurance refers to splitting a single risk among several insurers, each independently assuming a defined share of the risk and premium.
Explained on the topic page Contract Law
Cold calling refers to contacting a potential customer by phone or in person without prior consent or an existing business relationship.
Explained on the topic page Distribution
Collection authority entitles an insurance intermediary to receive premium payments from the policyholder on behalf of the insurer, with the effect that payment to the intermediary discharges the policyholder's obligation toward the insurer.
Explained on the topic page Distribution
The combined ratio is the sum of an insurer's loss ratio and expense ratio; a value below 100 percent means the underwriting business is profitable.
The compensation claim under § 89b HGB entitles an insurance agent, upon termination of the agency, to compensation for benefits the insurer continues to derive from the agent's acquired customers.
Commission is the performance-based fee, usually calculated as a percentage of the placed premium, that an insurer pays an intermediary for placing or servicing an insurance contract.
Commutation is the final financial settlement of a reinsurance contract, under which the ceding insurer gives up all rights in exchange for compensation and the reinsurer is released from all obligations.
Explained on the topic page Reinsurance
In Germany a commuting accident is an occupational accident on the direct route to and from the place of work that is connected with the insured activity (§ 8 para. 2 SGB VII), and in Austria an occupational accident on the way to or from the workplace (§ 175 para. 2 ASVG); Switzerland has no separate category and treats the commute as a non-occupational accident, or as an occupational accident for part-time employees working fewer than eight hours a week (Art. 7 para. 2 UVG).
A company pension is an old-age, disability, or survivors' benefit promised or co-financed by the employer as part of occupational pension provision.
Explained on the topic page Occupational Pensions
Complaints management is the organizationally embedded, regulatorily governed process by which insurers must handle customer complaints.
Explained on the topic page Regulatory
Completed operations refers to liability coverage for bodily injury and property damage that arises only after work performed by the insured has been finished and accepted.
The compliance function is one of the four Solvency II key functions and monitors compliance with laws and regulatory requirements within an insurance undertaking.
A composite insurer is an insurance undertaking that writes both life and non-life insurance business, a model that is restricted or no longer permitted under the supervisory law of many jurisdictions.
Compounding is the calculation of the future value of a present capital amount, taking interest and compound interest into account.
Explained on the topic page Actuarial
Compulsory contracting obliges an insurer to conclude an insurance contract with any applicant within a defined scope, without the right to individually decline the risk.
Compulsory insurance is insurance mandated by law, the taking out of which is a mandatory precondition for engaging in a particular activity or for a particular risk to be permitted.
The Jahresarbeitsentgeltgrenze is the annually determined income threshold in Germany above which employees are exempt from mandatory statutory health insurance and may switch to private health insurance.
Explained on the topic page Health Insurance
Conduct risk is the risk that inappropriate behavior by an insurer towards customers causes harm and results in regulatory or reputational consequences.
A confidence interval indicates a range of values that contains the true parameter of a statistical estimate with a specified probability.
Explained on the topic page Actuarial
A conflict of interest exists when an insurer's or intermediary's own interests contradict those of the policyholder, thereby jeopardizing objective advice or service delivery.
Explained on the topic page Distribution
Consequential loss is an indirect economic loss resulting from a preceding physical or bodily injury loss, without constituting that loss itself.
Explained on the topic page Property Insurance
Consequential loss from a defect is damage caused by a defect in a delivered item or service to other legal interests of the injured party, and, unlike the defect itself, is generally covered by liability insurance.
Consulting liability is civil liability for damage suffered by a third party as a result of defective professional advice or information.
Explained on the topic page Liability Insurance
Contingent business interruption covers loss of income arising when physical damage at a supplier or customer disrupts the policyholder's own operations.
Continuation insurance preserves the right to reinstate a suspended policy at a later date at its original terms, without a new health assessment.
Explained on the topic page Life Insurance
In international health insurance, continuation of cover refers to maintaining existing insurance protection without fresh underwriting – on a change of insurer by carrying over the previous terms (continued personal medical exclusions, CPME), on leaving a group scheme through a conversion right into an individual policy, and within the policy through a waiver of cancellation on grounds of age or claims history; market practice ties it to continuous prior cover, maximum ages and a comparable level of benefits.
The continuation option allows an insured person to convert a group insurance policy into an individual policy without a new health assessment upon leaving the group.
A continuing hazard is a persistent, not merely temporary, risk-increasing circumstance, the non-disclosure of which can trigger specific contractual consequences.
Explained on the topic page Contract Law
The contra proferentem rule holds that ambiguous clauses in insurance policy wording are, in case of doubt, construed against the insurer as the drafter of the wording.
Contract certainty is the principle that all material contract terms should be fully agreed and documented before, or immediately upon, the inception of coverage.
Explained on the topic page Reinsurance
Contractors' works insurance covers physical damage to the works of a construction project during the construction period against unforeseen events.
Explained on the topic page Property Insurance
Contractual liability is liability for damage resulting from non-performance or defective performance of contractual duties, as distinct from tortious liability.
Explained on the topic page Liability Insurance
A contribution gap exists when a person has paid no, or insufficient, AHV contributions in a given calendar year, resulting in a permanent reduction of their old-age pension.
Explained on the topic page AHV
The contribution principle governs how multiple insurers that independently cover the same risk share a loss among themselves.
Explained on the topic page Contract Law
A contribution-oriented defined benefit promise is a German occupational pension commitment where contributions are converted into a guaranteed pension benefit the employer promises.
Explained on the topic page Occupational Pensions
Contributory or comparative negligence is the legal doctrine under which a claimant's damages are reduced in proportion to the extent that their own negligence contributed to the loss.
The contributory share (Mitwirkungsanteil) is the percentage determined in accident insurance to which illness or infirmity contributed to an accident-related injury or its consequences; above a contractual threshold – 25 per cent under the AUB 2020 – it leads to a proportionate reduction of the degree of disability or of the benefit.
The convalescence benefit (Genesungsgeld) is a supplementary benefit of private accident insurance paid as a fixed daily amount following an accident-related hospital stay for the same number of days as the hospital cash benefit, usually on a decreasing scale and for a limited period.
The coordinated salary is the portion of salary insured under occupational pension provision (BVG), calculated as the qualifying AHV salary less the coordination deduction.
Explained on the topic page Occupational Pension
The coordination deduction is the fixed or percentage-based amount subtracted from AHV salary to align occupational pension provision with AHV benefits and avoid over-insurance.
A corporate bond is a fixed-income security issued by a company and one of the most important asset classes in insurers' investment portfolios.
Explained on the topic page Investments
Corporate group insurance is a contract under which an employer insures the employees of a business collectively against certain risks (e.g. accident, illness, death), without concluding an individual contract for each person.
Cosmetic surgery after an accident is a benefit module of private accident insurance that reimburses, up to the agreed sum, the costs not borne by third parties of medical procedures to correct an accident-related impairment of the insured person's outward appearance, including dental treatment of incisors and canines.
A cost approval (Kostengutsprache) is the binding confirmation obtained before treatment that an insurer or canton will pay for a specific service; in Switzerland it is standard for out-of-canton hospital stays (Art. 41 para. 3 KVG), certain KLV benefits and practically all hospital supplementary and rehabilitation benefits under the VVG, and functionally corresponds to pre-authorisation in international private medical insurance.
Cost sharing under Art. 64 KVG is the share of health care costs borne by insured persons in Swiss basic insurance: an annual deductible (franchise; ordinary CHF 300, electable up to CHF 2,500 for adults), a co-payment of 10 % of costs above the deductible (capped at CHF 700 per year, children CHF 350) and a hospital contribution of CHF 15 per day (as per Art. 103 f. KVV, September 2026).
A cover note is a preliminary confirmation of insurance coverage issued by an insurer or broker pending issuance of the final policy.
Explained on the topic page Contract Law
The cover pool is a specially protected ring-fenced asset pool held by life insurers, primarily intended to secure policyholders' claims.
Explained on the topic page Life Insurance
Coverage litigation is the judicial or extrajudicial process determining whether, and to what extent, liability insurance provides coverage for a specific loss.
Explained on the topic page Liability Insurance
The coverage trigger determines which point in time is decisive for whether a loss is covered under a given insurance period.
Explained on the topic page Contract Law
A covered bond is a secured bond protected, in addition to issuer liability, by a ring-fenced pool of high-quality collateral assets.
Explained on the topic page Investments
The covered journey is the temporary business absence from the place of residence or work, directed by the employer, as defined in business travel accident insurance – it begins on leaving that place, ends on return, includes attached private holiday days within limits and is capped at a maximum duration of typically 90 to 365 days; commuting is not a business trip.
Credibility theory weights an individual risk's own claims experience against a collective value, depending on the statistical reliability of the individual experience.
Explained on the topic page Actuarial
Credit assessment is the systematic evaluation of a counterparty's ability to pay and forms the central underwriting basis of credit insurance.
Explained on the topic page Credit Insurance
Credit default risk is the risk that a debtor fails to meet its contractual payment obligations, in whole or in part.
Explained on the topic page Credit Insurance
Credit exposure (German: Obligo) is the total amount of outstanding receivables owed by a specific buyer at a given point in time, to which the coverage of a trade credit insurance policy relates.
Creditworthiness is a debtor's ability and willingness to meet its financial obligations fully and on time, and forms the basis of rating and credit risk assessment.
Explained on the topic page Investments
Critical illness insurance pays a single lump sum upon diagnosis of a serious illness exhaustively defined in the contract, regardless of actual loss of income.
Cross-border business refers to the distribution of insurance products beyond an insurer's home state, based on the European freedom to provide services.
Explained on the topic page Regulatory
Cross-selling refers to selling additional insurance products to existing customers who already hold another contract with the same insurer.
Explained on the topic page Distribution
A cure treatment is a medically prescribed, usually multi-week course of treatment at a climatically or therapeutically suitable location, whose reimbursement under health and supplementary insurance is subject to specific tariff conditions.
Explained on the topic page Health Insurance
The currency clause determines the currency in which premiums and benefits are calculated and paid, and governs the treatment of exchange rate fluctuations.
Explained on the topic page Contract Law
The data protection officer monitors compliance with data protection law within an organization and is regularly required to be appointed by insurers due to their extensive processing of sensitive data.
The death benefit is the contractually agreed insurance benefit that a life insurer pays to the beneficiary upon the death of the insured person.
Debris removal costs are the expenses for clearing and disposing of rubble and other unsalvageable remains at the loss site; combined homeowners property insurance typically covers them on a proportional basis.
Explained on the topic page Property Insurance
Debt collection is the commercial recovery of receivables owed to, or assigned for collection to, a specialised, typically registered collection service provider, which pursues pre-legal and, where necessary, legal steps to recover overdue payments.
Decrement probability, in life and health insurance, is the probability of leaving a defined population group within a given period of time.
Explained on the topic page Actuarial
The decrement table presents the withdrawal probabilities of policies leaving a private health insurer's portfolio, by age and observation period.
Explained on the topic page Actuarial
A deductible is the contractually agreed portion of a loss that the insured bears itself before the insurance payment begins.
Explained on the topic page Contract design
Defense against unfounded claims is one of a liability insurer's two principal contractual obligations, requiring it to reject unfounded claims brought against the policyholder.
Explained on the topic page Liability Insurance
A defense right is a counter-right that can be raised against an otherwise existing claim, hindering its enforcement without eliminating the claim itself.
The deferment period is the time between conclusion of a deferred annuity contract and the start of pension payments, during which capital is accumulated.
Explained on the topic page Retirement Provision
The deferred period is the contractually agreed span of time between the occurrence of an insured event and the start of the insurer's obligation to pay benefits, particularly under daily sickness benefit and disability insurance.
Explained on the topic page Health Insurance
Under a deficiency guarantee, the creditor may only call on the guarantor once enforcement against the principal debtor has proven unsuccessful.
Explained on the topic page Credit Insurance
A defined contribution plan with minimum benefit is a German occupational pension commitment type where the employer guarantees only the contributions paid, not a specific pension amount.
Explained on the topic page Occupational Pensions
The definition of accident is the contractual or statutory description of an accident as a sudden, involuntary event acting externally on the body and causing bodily injury, which delimits the insured event in accident insurance from illness and wear and tear.
The degree of disability is the percentage of permanent impairment of physical or mental capacity, determined under accident insurance using a scale of limb values or a medical assessment, which governs the amount of the disability benefit.
Explained on the topic page Accident Insurance
A demand guarantee obliges the surety to pay immediately upon the creditor's mere demand, without first having to examine objections.
Demolition costs are the expenses for tearing down building remains that can no longer be salvaged after a loss event; combined homeowners property insurance typically covers them up to a defined share of the sum insured.
Explained on the topic page Property Insurance
Depreciation is the systematic or exceptional accounting reduction in the book value of an asset over its useful life or due to a permanent impairment.
Explained on the topic page Accounting
A derivative is a financial instrument whose value is derived from an underlying asset, used by insurers primarily to hedge investment risks.
Explained on the topic page Investments
A development commission is an additional reinsurance commission through which the reinsurer provides the cedent an expense overallowance to help build up its business operations.
Explained on the topic page Reinsurance
Difference in Conditions/Difference in Limits cover closes gaps between a global insurance program and divergent, less comprehensive local policies.
Diminished value refers to the residual loss in value of a repaired item, particularly a vehicle, that remains despite proper repair compared with its condition before the loss.
Direct billing is the settlement of treatment costs directly between the healthcare provider and the insurer, so that the insured person does not have to pay up front; it usually requires a provider network, pre-authorisation and a guarantee of payment issued by the insurer to the hospital.
Direct insurance is one of five statutory implementation vehicles for occupational pensions in Germany, where the employer takes out a life policy for the employee's benefit.
Explained on the topic page Occupational Pensions
A direct insurer sells its products directly to end customers, particularly via the internet and telephone, without intermediaries.
Explained on the topic page Distribution
A direct pension promise is an employment-law commitment under which an employer undertakes to pay a defined pension benefit directly from the company to an employee in old age, on disability, or to their survivors on death.
The direct right of action allows an injured party to assert its claim for damages directly against the wrongdoer's liability insurer.
Explained on the topic page Liability Insurance
Disability is the permanent, usually accident-related impairment of a person's physical or mental capacity, which represents the central triggering event for benefits under accident insurance.
Explained on the topic page Accident Insurance
The IV is the Swiss social insurance scheme that provides integration measures and pension benefits to individuals whose earning capacity is permanently impaired by a birth defect, illness, or accident.
The Versehrtenrente is the pension of Austrian statutory accident insurance under §§ 203 ff. ASVG for insured persons whose earning capacity is reduced by at least 20 percent for more than three months as a result of an occupational accident or occupational disease; the full pension amounts to 66 2/3 percent of the assessment basis, the partial pension to the share corresponding to the reduction in earning capacity, and severely injured persons receive an additional pension.
Discounting is the conversion of a future payment amount into its present value using a given interest rate.
Explained on the topic page Actuarial
A distance selling contract is an insurance contract concluded exclusively through means of distance communication, subject to special information duties and an extended right of withdrawal.
Explained on the topic page Distribution
Diversification reduces the overall risk of a portfolio or insurance book by spreading exposure across weakly correlated risks, asset classes, or lines of business.
Explained on the topic page Investments
Dog owner's liability insurance is a specialized liability policy for dog keepers that covers bodily injury and property damage caused by the animal, and is a statutory requirement for certain breeds or generally in many regions.
Explained on the topic page Liability Insurance
Doorstep selling refers to concluding an insurance contract away from the intermediary's business premises, such as in the customer's private home, which triggers extended withdrawal and disclosure obligations to protect the consumer.
Explained on the topic page Distribution
Double insurance exists when the same interest is insured against the same peril with multiple insurers and the combined sums insured exceed the insurable value.
Explained on the topic page Contract Law
Dowry endowment insurance is a life insurance policy taken out on a child that pays a lump sum upon the child's marriage or upon reaching a specified age.
Explained on the topic page Life Insurance
Drainage pipes carry wastewater out of a building; breakage damage to them inside the building is typically covered under the water damage peril in combined homeowners property insurance.
Explained on the topic page Property Insurance
A drawdown payout plan is a form of decumulating accumulated capital at retirement through regular installments plus interest, until the capital is exhausted.
Explained on the topic page Retirement Provision
A drop down cover is a clause under which a higher excess layer drops down into an exhausted or unavailable lower layer to close the resulting coverage gap.
Explained on the topic page Reinsurance
The due date is the point in time from which a contractual claim can be demanded by the creditor and must be performed by the debtor.
Explained on the topic page Contract Law
Duration measures the average capital-weighted maturity of a fixed- income security or portfolio and its sensitivity to interest rate changes.
Explained on the topic page Investments
The duty to advise is the statutory obligation of an insurer or intermediary to inform the policyholder of material aspects of the contract, in particular exclusions, obligations, and rights of withdrawal.
Explained on the topic page Distribution
The duty to ensure safety obliges anyone who creates or maintains a source of danger to take the measures reasonable under the circumstances to protect third parties from resulting harm.
The duty to mitigate loss obliges the policyholder to take reasonable measures to avert or reduce the loss in the event of an insured event.
A dynamic increase clause automatically raises the premium and benefit of a life or annuity contract at regular intervals without a new health assessment.
Explained on the topic page Life Insurance
Earthquake is a natural peril with high accumulation potential, whose insurability depends significantly on regional seismicity and reinsurance capacity.
Education endowment insurance is a life insurance policy taken out on a child that provides a lump sum to fund education or university studies.
Explained on the topic page Life Insurance
EIOPA is the European supervisory authority that coordinates insurance supervision across the EU, develops technical standards, and promotes consistent application of Solvency II.
Explained on the topic page Regulatory
Electrical damage is loss to electrical installations or devices caused by the direct effect of electric current (e.g. short circuit, overvoltage, cable fire), without a fire in the sense of fire insurance occurring.
Embedded value is an actuarial metric that derives the present value of an insurer's existing life insurance portfolio from expected future profits.
Employee benefits are the pension and insurance benefits financed or arranged by an employer for its staff beyond salary; in Switzerland they mainly comprise occupational pension provision (BVG), daily sickness allowance insurance, supplementary UVG and group accident insurance, group supplementary health insurance and international private medical insurance for expatriates, and are compared against the market by brokers through benchmark studies.
Employee-financed occupational pension arises when an employee funds their occupational pension by converting part of their own salary into pension contributions.
Explained on the topic page Occupational Pensions
The employer's duty of care obliges it to protect the life, health and personal integrity of employees on business trips through appropriate measures – in Switzerland under Art. 328 CO, in Germany under section 618 BGB and the Occupational Safety Act, in Austria under section 1157 ABGB and the ASchG, and at common law as the duty of care; business travel insurance is part of, not the fulfilment of, this duty.
Employer's vicarious liability is a principal's tortious liability for damage caused by its auxiliary person while carrying out an assigned task.
The entry threshold is the legally defined minimum annual salary above which employees must be mandatorily insured under occupational pension provision (BVG).
Explained on the topic page Occupational Pension
An equalization reserve is a statutory accounting provision that sets aside amounts from better-than-average loss years to offset future worse-than-average loss years in highly volatile lines of business.
Equity risk is the risk of a loss in value from equity investments due to price fluctuations in capital markets, and is a sub-risk of the market risk module under Solvency II.
Explained on the topic page Investments
ESG refers to environmental, social, and governance criteria that insurers must increasingly consider in investments, underwriting, and regulatory disclosure.
Explained on the topic page Investments
The event definition clause specifies in a reinsurance contract how multiple individual losses from the same occurrence are aggregated in time and substance into a single loss event, which forms the basis for the retention and liability limit.
Explained on the topic page Reinsurance
An ex gratia payment is a voluntary goodwill payment made by an insurer without acknowledging any legal obligation.
Explained on the topic page Claims management
Excess of loss is the fundamental form of non-proportional reinsurance, under which the reinsurer covers losses above an agreed retention up to a capacity limit.
An exclusion clause limits or excludes a contracting party's statutory or contractual liability but is subject to strict limits under terms-and-conditions review.
Explained on the topic page Contract Law
A Vorbehalt is an individual benefit exclusion in Swiss private supplementary health insurance under the VVG by which the insurer removes existing or past conditions and their consequences from cover; it is based on the health declaration (duty of disclosure, Art. 4 VVG), may be limited in time or permanent, and is not permitted in basic insurance under the KVG.
An exclusion of liability is a contractual clause that wholly or partially excludes a party's liability for certain damages or causes; in an insurance contract, this corresponds to a risk exclusion.
Explained on the topic page Contract Law
An exclusive agent places insurance contracts solely for a single insurance company, with which it maintains a particular relationship of trust.
Explained on the topic page Distribution
The exhaustion clause governs the consequences when the capacity of an insurance or reinsurance layer has been fully used up by losses already incurred.
Explained on the topic page Reinsurance
Expatriate insurance is the protection of employees who work outside their home country for an extended but temporary period, combining international health, accident, assistance and life cover; it distinguishes between classic assignees, local-plus contracts and third-country nationals.
Expected value is the probability-weighted average of a random variable and the basis of every actuarial risk premium.
Explained on the topic page Actuarial
The expense ratio relates an insurer's administrative and acquisition costs to its earned premiums and is a component of the combined ratio.
Explained on the topic page Actuarial
Explosion is a sudden release of force caused by the tendency of gases or vapors to expand, and one of the basic perils of fire insurance.
Explained on the topic page Property Insurance
Export credit guarantees are state-backed export credit guarantees provided by the Federal Republic of Germany to promote foreign trade, known as Hermes cover.
Explained on the topic page Credit Insurance
Export credit insurance protects exporters against economic and political risks of non-payment by foreign buyers.
Exposure is the extent to which assets, people or earnings are subject to a particular risk; it is the basis of all risk assessment and premium rating.
Exposure rating is a method for pricing reinsurance treaties based on portfolio metrics and loss distribution curves rather than actual claims experience.
Explained on the topic page Reinsurance
An extended reporting period is the continuation of insurance or reinsurance cover beyond the end of the underlying policy period for losses not yet reported from that earlier period.
Extreme value theory is a statistical approach for modeling the distribution of rare, particularly extreme events in the tails of a distribution.
Explained on the topic page Actuarial
A facultative facility is a simplified process for facultatively reinsuring individual risks within predefined limits agreed in advance with the reinsurer.
Facultative reinsurance is the case-by-case reinsurance of a specific individual risk, which the reinsurer may accept or decline after individual assessment.
Explained on the topic page Reinsurance
Fair value is the price that would be received to sell an asset or paid to transfer a liability between knowledgeable, willing parties at the measurement date.
Explained on the topic page Accounting
Family insurance allows spouses and children of a member of Germany's statutory health insurance to be co-insured without additional contribution, subject to income limits.
Fault liability is the basic rule of civil liability under which a tortfeasor is only obliged to compensate a loss if they are at fault – through intent or negligence.
Fee-based advice is a remuneration model in insurance and financial advisory services in which the advisor is paid a fee directly by the client rather than being financed through commissions from the product provider.
Explained on the topic page Distribution
Under Germany's statutory health insurance, a benefit application is deemed approved if the fund fails to decide within the statutory deadline.
A financial investment intermediary places certain investments such as investment fund units or capital investments and requires a distinct trade-law license to do so.
Explained on the topic page Distribution
Finite risk reinsurance is a form of alternative reinsurance in which risk assumption is limited and more strongly focused on the timing of cash flows.
Fire insurance covers property damage caused by fire, lightning strike, explosion, or the impact of an aircraft on the insured property.
Explained on the topic page Property Insurance
Fire protection regulations set out organizational and structural fire prevention measures and behavior in the event of fire for a building or business.
In first loss insurance, the sum insured is not set to the full value of the insured object but to a freely chosen amount (the "first loss"), up to which losses are indemnified in full without applying the underinsurance rule.
Explained on the topic page Property Insurance
The Fisher equation describes the relationship between the nominal interest rate, the real interest rate, and expected inflation, and is relevant to valuing inflation-linked obligations.
Explained on the topic page Actuarial
The fit-and-proper test (reliability check) is a precondition for granting a trade licence to independent insurance intermediaries and is carried out by the competent chamber of commerce or by the insurance company itself.
Force majeure describes an extraordinary event, external to the parties, that could not have been foreseen or averted even with the utmost reasonable care, affecting liability and coverage questions in insurance.
A form requirement demands a specific form, such as written or text form, for a declaration of intent to be valid, non-compliance with which can render it invalid.
Explained on the topic page Contract Law
The forward rate is the interest rate implicitly expected for a future period, derived from the current yield curve.
Explained on the topic page Actuarial
Free choice of physician is the right of a privately health-insured person to select their treating physician from among all licensed doctors, without being tied to a fixed provider network.
Explained on the topic page Health Insurance
Heilfürsorge is a special benefit system under which certain professional groups (e.g., police, military) receive free medical services or benefits in kind directly from their employer in lieu of conventional health insurance.
Explained on the topic page Health Insurance
Fronting is an arrangement in which a licensed insurer issues a policy and passes the risk entirely or predominantly to another risk carrier – often a captive – via reinsurance.
Explained on the topic page Risk financing
Frost damage is property damage caused by cold exposure, such as to water-bearing pipes, and can be treated differently across property insurance conditions.
Explained on the topic page Property Insurance
A full and final settlement declaration is a document signed by the policyholder in which, upon final closure of a claim, they waive any further present and future claims arising from that loss.
Full medical underwriting (FMU) is the risk assessment method in international health insurance under which the applicant declares their complete medical history before inception and the insurer then permanently excludes pre-existing conditions, applies a premium loading or – if the findings are unremarkable – accepts the risk without restriction; the boundaries of cover are therefore fixed at policy start.
In full value insurance, the sum insured equals the full insured value of the insured object, so that no underinsurance can generally arise in the event of a claim.
Explained on the topic page Property Insurance
Funds withheld refers to an arrangement under which the cedent retains and manages assets that would otherwise be transferred to the reinsurer.
Explained on the topic page Reinsurance
General average is a marine law principle under which losses and expenses deliberately and reasonably incurred to save a ship and its cargo from a common peril are shared proportionally by all parties with an interest in the voyage.
The ADSp are standard terms and conditions used in the German freight forwarding trade, governing the rights and duties of the forwarder and their client, particularly regarding cargo insurance.
Explained on the topic page Transport Insurance
General Insurance Conditions are pre-formulated contract terms that uniformly govern the scope, exclusions, and obligations of an insurance contract across a large number of policies.
Explained on the topic page Contract Law
The ARB are the general policy conditions for German legal expenses insurance, which since 1994 no longer require regulatory approval and therefore vary considerably between insurers.
The Investment Ordinance set quantitative investment rules for smaller German insurers outside the Solvency II regime, prior to the introduction of Solvency II.
Explained on the topic page Regulatory
The grace period is a statutorily mandated additional payment period that an insurer must grant a policyholder in the event of non-payment of a renewal premium, before the insurer can deny coverage or terminate the contract.
Gradual damage is property damage caused by the sustained, long-term action of external circumstances, and is frequently limited or excluded under liability insurance.
Explained on the topic page Liability Insurance
The Green Card is an internationally recognized proof of motor liability insurance coverage for using a vehicle abroad.
The gross method presents assets and liabilities arising from reinsurance separately and unnetted, rather than offsetting them against the net result.
Explained on the topic page Accounting
The gross premium is the total premium payable by the policyholder before deduction of reinsurance shares and commission.
Explained on the topic page Accounting
Ground-up cover refers to reinsurance coverage that applies from the first dollar of a loss, without the cedent retaining a deductible.
Explained on the topic page Reinsurance
In a group insurance contract, a policy is concluded between an insurer and a policyholder (e.g. an employer or association) that insures a group of persons under uniform conditions.
Group supervision extends solvency supervision under Solvency II from the individual insurance company to the entire insurance group.
Explained on the topic page Regulatory
The guarantee commission is the fee a customer pays to a bank or surety insurer for assuming the risk of a guarantee or bond (aval).
Explained on the topic page Credit Insurance
A guarantee credit line is a facility granted by a bank or surety insurer within which individual guarantees and bonds (avals) can be issued on behalf of a customer.
Explained on the topic page Credit Insurance
The guarantee facility limit is the contractually agreed maximum amount up to which a surety insurer or bank will issue guarantees and bonds for a customer.
Explained on the topic page Credit Insurance
A guarantee fund is a statutorily mandated protection scheme that grants policyholders a basic level of protection in the event of a life insurer's insolvency.
A guaranteed insurability option is a contractual right to increase the coverage of a life or disability insurance policy upon certain life events, without a new medical underwriting assessment.
The guaranteed interest rate is a life insurer's contractual obligation to provide a minimum return on the savings premiums of a policy.
Explained on the topic page Life Insurance
Hail is a natural hazard in which precipitation in the form of ice pellets damages buildings, vehicles, and crops, and is typically covered as a named peril in homeowners, contents, motor, and agricultural policies.
Hard market and soft market describe the cyclical phases of the insurance and reinsurance market in which capacity, premium levels, and terms move inversely to supply and demand.
Explained on the topic page Reinsurance
A hazardous activity (Wagnis) in Swiss accident insurance is an act by which the insured person exposes himself or herself to a particularly great danger without taking, or being able to take, the precautions that would limit the risk to a reasonable level; cash benefits for non-occupational accidents resulting from such an activity are reduced by half and refused in particularly serious cases.
The health underwriting questionnaire collects an applicant's health status before contract conclusion, forming the basis for the insurer's risk assessment.
The helplessness allowance is a monthly cash benefit of Swiss social insurance for persons who, because of a health impairment, permanently depend on the help of others or on personal supervision for everyday activities (Art. 9 ATSG); in accident insurance it amounts under Art. 27 UVG to two, four or six times the maximum insured daily earnings, depending on the degree of helplessness.
Historical cost comprises all expenditures incurred to acquire an asset and bring it into a condition ready for use.
Explained on the topic page Accounting
A hold harmless agreement is a contractual arrangement under which one party undertakes to indemnify the other party financially against certain third-party claims or a specific event.
The hospital cash benefit (Krankenhaustagegeld) is a fixed cash amount that accident or supplementary health insurance pays to the insured person for each calendar day of medically necessary inpatient treatment, irrespective of the actual costs incurred.
Household contents insurance covers damage to a household's movable property caused by fire, burglary, water damage, storm/hail, and optionally other natural hazards.
Explained on the topic page Property Insurance
The hurdle rate is the minimum required return on capital demanded by investors or management that a business, underwriting line, or investment project must achieve to be considered value-creating.
Hybrid capital comprises financing instruments with characteristics of both equity and debt, which under Solvency II can qualify as basic own funds of Tier 1, Tier 2, or Tier 3 quality depending on their structure.
The IAIS is the international standard-setting body for insurance supervisors, developing and coordinating global supervisory standards for the insurance industry.
Explained on the topic page Regulatory
IBNR (incurred but not reported) refers to losses that have already occurred but have not yet been reported to the insurer; technical reserves are established for them.
Explained on the topic page Reserving
The Insurance Capital Standard (ICS) is a global, risk-based capital standard developed by the IAIS for internationally active insurance groups.
Explained on the topic page Regulatory
Imputed periods are contribution-free periods in German statutory pension insurance that are credited to increase the pension, offsetting the low pension resulting from an early reduction in earning capacity.
Explained on the topic page Pension insurance
Incapacity for work describes the illness-related state in which an employee can no longer perform their most recent occupation, distinct from occupational and general disability.
Explained on the topic page Health Insurance
Inception of cover is the point in time from which the insurer is substantively liable for insured events, which can differ from the formal contract start date.
Explained on the topic page Contract Law
Income splitting is the equal division of both spouses' AHV-qualifying income earned during the years of marriage when calculating pensions, regardless of who actually earned the income.
Explained on the topic page AHV
An increase of risk is a subsequent change in risk circumstances that heightens the insured risk and triggers particular disclosure duties for the policyholder.
The indemnification claim is the policyholder's claim against the liability insurer to be released from justified third-party claims for damages.
Explained on the topic page Liability Insurance
An independent insurance intermediary acts in the customer's interest and is not legally or economically bound to a specific insurer, unlike a tied insurance agent.
Industrial insurance refers to the segment of property and liability insurance that individually underwrites the complex risks of industrial and large corporate clients, frequently involving brokers and co-insurance consortia.
Inflation risk describes the risk that an insurer's future claims costs turn out higher than assumed in premium pricing or reserving due to general price or wage increases.
Explained on the topic page Actuarial
The initial reserve is the amount set up as the first claims reserve in an insurer's claims system for a newly reported loss.
Explained on the topic page Claims management
Injury benefit (Verletztengeld) is the income replacement benefit of German statutory accident insurance for incapacity for work resulting from an occupational accident or occupational disease (§§ 45 ff. SGB VII); it amounts to 80 percent of the regular pay, capped at net pay, is generally paid after the end of the six-week period of continued salary payment and ends at the latest after the 78th week.
The injury pension (Verletztenrente) is the pension of German statutory accident insurance for insured persons whose earning capacity is reduced by at least 20 percent beyond the 26th week as a result of an occupational accident or occupational disease (§ 56 SGB VII); the full pension amounts to two thirds of the annual earnings, the partial pension to the share corresponding to the reduction in earning capacity.
Insolvency is a debtor's inability to fully meet due payment obligations, and it forms the central insured default risk in trade credit insurance.
Insurable interest is the legally recognised economic interest a person has in the non-occurrence of an insured event; it is a basic precondition for any valid indemnity insurance contract.
An insurance agent is an independent intermediary who arranges contracts on behalf and in the name of one or more insurers, acting either as a tied agent or a multi-agent.
Explained on the topic page Distribution
The insurance application is the declaration of intent by which a prospective policyholder offers to conclude an insurance contract on specified terms.
Explained on the topic page Distribution
The Abredeversicherung is the extension of non-occupational accident insurance by special agreement with the previous UVG insurer under Art. 3 para. 3 UVG and Art. 8 UVV; it must be concluded before the end of the 31-day run-off cover and extends protection against non-occupational accidents by a maximum of six months.
The insurance contract is the legal agreement under which the insurer, in exchange for a premium, undertakes to provide the agreed benefit upon occurrence of the insured event.
The insurance policy is the document issued by the insurer that confirms in writing the conclusion and essential content of an insurance contract.
The IPID is a standardized, short information document summarizing the key features of a non-life insurance contract for the policyholder in an understandable format before conclusion.
Explained on the topic page Distribution
The insurance supervisory authority oversees insurance companies in the interest of policyholders through legal, financial, and qualitative supervisory tools.
Explained on the topic page Regulatory
Insurance-linked securities are securitized risk transfer instruments that transfer insurance risk – particularly natural catastrophe risk – directly to capital market investors, bypassing the traditional reinsurance market.
The insured earnings are the basis for calculating all cash benefits of Swiss compulsory accident insurance under Art. 15 UVG; they generally correspond to the salary subject to AHV contributions and are capped under Art. 22 para. 1 UVV at CHF 148,200 per year or CHF 406 per day (as of 2026).
The insured event is the occurrence defined in the insurance contract whose occurrence triggers the insurer's obligation to pay.
Integrity compensation is a lump-sum benefit of Swiss accident insurance under Art. 24 f. UVG for a permanent and significant impairment of physical, mental or psychological integrity; it is assessed independently of earning capacity as a percentage of the maximum insured earnings according to the scale in Annex 3 UVV.
Interest rate risk is the risk that an insurance company fails to earn, from its investments, the discount rate assumed in premium calculation.
Explained on the topic page Solvency
The interest rate transitional measure is a Solvency II transitional provision that allows insurers to temporarily approximate the risk-free yield curve used to value their obligations to an earlier Solvency I interest rate.
Explained on the topic page Solvency
Interest surplus is the part of a life insurance portfolio's investment result that remains after deducting investment management expenses and the guaranteed interest owed to policyholders.
Explained on the topic page Life Insurance
Interest-bearing assets are the capital of an insurance company available for yield-generating investment; on the balance sheet they mainly comprise own funds and technical provisions.
Explained on the topic page Investments
The interim portfolio is the stock of German life insurance policies concluded between 1 January 1995 and 1 January 1998, administered separately from the legacy and new portfolios.
Explained on the topic page Life Insurance
Internal models are risk models developed by an insurer itself and approved by the supervisor for calculating the Solvency Capital Requirement (SCR), designed to reflect the insurer's individual risk profile more precisely than the standard formula.
Explained on the topic page Solvency II
IPMI benefit modules are the combinable building blocks of an international health plan – in-patient cover as the core, supplemented by out-patient, dental, maternity, evacuation, vision and wellness modules – through which the scope, limits and premium of a plan are controlled.
The J-curve describes the typical result pattern of a reinsurance contract, an underwriting year, or an ILS investment, in which losses are incurred initially before results improve over time.
Joint and several debtors are multiple debtors from any of whom the creditor may demand the entire performance until the claim is fully satisfied.
Explained on the topic page Liability Insurance
Joint and several liability exists when several persons are each individually liable to the injured party for the entire loss, allowing the injured party to claim full compensation from any one of them.
Keeper's liability is a no-fault strict liability that holds the keeper of an object (particularly a motor vehicle or animal) liable for damage to third parties solely on the basis of the inherent operational or object risk.
A large loss is a claim whose size exceeds a defined threshold and which is tracked separately because of its significance for reserves, reinsurance, and statistics.
Explained on the topic page Claims management
Latent claims are liability claims where a long period, often spanning many years or even decades, elapses between the causative event and the visible manifestation or reporting of the loss.
Explained on the topic page Liability Insurance
The law of large numbers states that the average claims cost of an insurance portfolio converges toward the theoretical expected value as portfolio size grows.
A layer is a defined liability band within an excess-of-loss reinsurance program, situated between a lower retention and an upper capacity limit, frequently underwritten by different reinsurers.
The leading insurer clause provides that a lead insurer in a co-insurance arrangement decides on behalf of all participating insurers regarding policy amendments and claims settlement.
A legal entity is a legally independent legal person that can hold rights and obligations in its own right as a policyholder, insured party, or insurer.
The Legal Entity Identifier is a globally unique, 20-character alphanumeric code used to identify legal entities participating in financial transactions and is mandated under numerous regulatory reporting requirements.
A letter of credit is a bank's conditional payment undertaking in favor of a seller, honored against presentation of contractually specified documents.
A life annuity is a recurring payment owed for the entire remaining lifetime of the beneficiary, thereby transferring the biometric risk of longevity to the insurer.
Life expectancy is the statistically expected average remaining lifetime of a person of a given age, derived from a mortality table, and is a central actuarial assumption in life and annuity insurance.
Explained on the topic page Life Insurance
The life settlement secondary market is the market on which rights under existing life insurance policies are traded between policyholders and investors.
Explained on the topic page Life Insurance
Lightning strike is the direct discharge of lightning onto an insured property and is treated as a distinct, typically covered peril in property insurance.
Explained on the topic page Property Insurance
A limitation period is the statutorily defined period after which an insurance claim can no longer be legally enforced, provided the opposing party invokes the expiry of that period.
With a limited premium payment period, premiums for a life or annuity policy are paid only over part of the total contract term, while coverage applies for the full term.
Explained on the topic page Life Insurance
Liquidity risk is the risk that an insurer does not have sufficient liquid assets available to meet its short-term payment obligations, particularly claims payments, on time.
Lloyd's of London is an insurance marketplace in London where independent underwriting groups (syndicates) write specialty risks through brokers, rather than operating as a single unified insurance company.
The location of risk principle ties the permissibility and regulatory treatment of insurance business to the place where the insured risk is situated.
Explained on the topic page Regulatory
A lockout is an employer's industrial action tool that temporarily excludes employees from the workplace; as a political risk, it is covered under property insurance extensions.
Explained on the topic page Property Insurance
Longevity risk is the risk that annuitants live on average longer than assumed in premium pricing, resulting in higher than expected annuity payments for the insurer.
Explained on the topic page Life Insurance
A loss is the involuntary reduction in material or immaterial value caused by an insured event, giving rise to the insured event under the policy.
The EO is the Swiss social insurance scheme that pays a daily allowance to compensate for lost earnings during military and civil protection service, maternity, and other defined care situations.
Explained on the topic page Social Insurance
Loss of use is the economic disadvantage suffered by an injured party from being unable to use a damaged item, particularly a motor vehicle, during the repair or replacement period.
A loss portfolio transfer is a reinsurance transaction in which a cedent transfers existing, not-yet-fully-settled claims reserves from a defined book of business to a reinsurer in exchange for a single upfront premium.
The loss ratio relates the loss expenditure incurred in a period to the premium earned in that period, and is a central metric for assessing underwriting profitability.
The lump-sum disability benefit (Invaliditätskapital) is the one-off capital payment under private accident insurance for permanent accident-related impairment of physical or mental capacity, the amount of which is derived from the sum insured, the degree of disability under the schedule of disability percentages and any agreed progression.
A managing general agent is a multi-line agent with extensive underwriting authority who binds specialty risks, collects premiums, and settles claims on behalf of the insurers it represents.
Explained on the topic page Distribution
A managing general agent is a specialized distribution partner that exercises delegated authority on behalf of one or more risk-carrying insurers to underwrite, price, and, often, settle claims within specific risk segments.
The UVG governs the mandatory insurance of employees in Switzerland against the financial consequences of occupational accidents, non-occupational accidents, and occupational diseases.
The mandatory employer subsidy requires employers to pass on part of the social security contributions saved through deferred compensation to the employee's occupational pension.
Explained on the topic page Occupational Pensions
Mandatory health care insurance (OKP) is Switzerland's basic health insurance under the KVG: every resident must take out cover (Art. 3 KVG), every licensed insurer must accept applicants without medical underwriting, and the benefits catalogue (Art. 25 et seq. KVG) is identical for all insurers.
The matching principle requires insurers to align their assets in currency, duration, and liquidity with their technical liabilities so that valuation fluctuations do not have an uncontrolled impact on solvency.
Maturity age is the age of the insured person specified in the contract at which the policy matures and, where applicable, a survival benefit becomes payable.
Explained on the topic page Life Insurance
The maturity benefit is the amount an insurer pays out when a life or annuity policy reaches its agreed maturity date and the insured survives.
Explained on the topic page Life Insurance
Maturity management is the process by which life and annuity insurers inform and advise customers, ahead of policy maturity, about benefit amounts and payout options.
Explained on the topic page Life Insurance
Maximum age is the contractually or tariff-defined upper age limit up to which a person may enter into or remain covered under a life, health, or pension insurance policy.
Medical aids are physical medical devices such as prostheses, hearing aids, wheelchairs, or vision aids, the cost of which is reimbursed under health and long-term care insurance in accordance with the applicable tariff terms.
Explained on the topic page Health Insurance
Medical evacuation is the insured, medically necessary transport of a person to the nearest suitable hospital where local facilities are inadequate; repatriation is the subsequent transport to the country of residence or nationality, including the repatriation of mortal remains in the event of death.
The Vertrauensarzt is the professionally independent physician appointed by a Swiss health insurer who, under Art. 57 KVG, advises the insurer on medical questions as well as remuneration and tariff application and reviews benefit conditions; the physician may pass on to the insurer only the information necessary for the decision and thus acts as a data protection filter between treatment and insurance.
Medical expenses (Heilungskosten) are the costs of medically necessary treatment after an accident covered by accident insurance – medical treatment, hospital stay, medicines, aids and transport – which Swiss mandatory accident insurance provides as a statutory benefit and private accident insurance offers as a subsidiary expense module.
Medical history disregarded (MHD) is the underwriting basis for corporate group schemes in international health insurance under which the insurer waives any health assessment and covers employees' pre-existing conditions from day one; it is typically offered from a minimum group size of around 15 to 20 members and is the most expensive but most inclusive underwriting option.
Medical inflation (medical trend) is the annual rate of increase in healthcare costs per insured person, made up of price, volume and treatment mix effects and regularly exceeding general inflation; for 2026 insurers expect 10.3 % globally according to WTW (Asia Pacific 14.0 %, North America 9.2 %, Europe 8.2 %), making it the central premium driver in international health insurance.
A messenger merely transmits another person's already-formed declaration, without making an independent legal decision like an agent, which affects knowledge attribution in insurance law.
Explained on the topic page Contract Law
Military insurance is the Swiss social insurance scheme that covers members of the armed forces, civil protection, and other persons subject to service obligations against the health and economic consequences of harm suffered during service.
Explained on the topic page Social Insurance
The Minimum Capital Requirement (MCR) is the absolute floor of eligible own funds under Solvency II, below which the supervisory authority is entitled to withdraw the insurer's authorization immediately.
Model policy conditions are non-binding reference wordings for insurance policy terms, issued by industry associations, that serve individual insurers as guidance for drafting their own contract wordings.
Explained on the topic page Contract Law
Model risk is the risk of flawed business decisions resulting from incorrect assumptions, errors, or improper application of quantitative models used in investment, reserving, or risk management.
Moral damages are a monetary payment compensating non-material harm (pain and suffering) owed in cases of severe personality infringement resulting from bodily injury or death.
Moratorium underwriting is a risk assessment method in international health insurance that dispenses with a health questionnaire: pre-existing conditions from a look-back period before inception (typically five years) are automatically excluded at first and only become covered once the insured person has completed a stability period (usually 24 months) free of symptoms, treatment, medication or medical advice; the assessment takes place only at the point of claim.
Morbidity risk is the risk that the actual frequency or severity of illness within an insured population deviates from the assumptions used in premium pricing.
A mortality decrement table is the rule used to determine the expected number of deaths per age group within a defined population over a given period.
Explained on the topic page Actuarial
Mortality risk is the risk that the actual mortality of an insured population under death benefit cover turns out higher than assumed when calculating the actuarial assumptions.
Explained on the topic page Life Insurance
A mortality table gives, for each age, the statistical probability of dying within one year, and serves as the basis for premium and reserve calculation in life insurance.
The motor insurers' guarantee fund is an institution supported by the insurance industry that compensates traffic accident victims when the tortfeasor is unknown, uninsured, or the insurer is insolvent.
A multiple agent places insurance contracts for several independent insurers, without primarily representing the customer's interests as a broker does.
Explained on the topic page Distribution
Mutual dissent exists when insurer and policyholder are, on closer examination, not actually in agreement on material contract terms, even though a contract was assumed to have been concluded.
Explained on the topic page Contract Law
The NAIC is the standard-setting and coordinating body for state insurance regulators in the United States, developing model laws and fostering cooperation among regulators across states.
In group personal accident insurance the insured persons may either be listed by name in the policy or – on an "unnamed basis" – be described only by categories of persons, headcount or payroll; under unnamed cover joiners and leavers are automatically included and the policyholder declares the population periodically.
Natural perils are losses caused by natural events such as flood, earthquake, landslide, or snow load, which can generally only be covered against an additional premium.
Negligence is the failure to exercise the care required in the circumstances and the central form of fault underlying liability claims.
Explained on the topic page Liability Insurance
The net investment return is the actual investment yield achieved by a life insurer after deducting investment management expenses, measured relative to the average book value of investments held.
Explained on the topic page Investments
A net policy is an insurance contract whose premium contains no sales commission, because the advisory service is separately and transparently remunerated between the client and the intermediary.
Explained on the topic page Distribution
The net premium is the actuarially calculated risk premium under the equivalence principle, excluding loadings for expenses, profit, and safety margins, covering exclusively the expected present value of the insurance benefit.
Explained on the topic page Actuarial
Net retention is the portion of an assumed risk that an insurer or reinsurer actually retains for its own account after taking into account all existing reinsurance protection arrangements.
Explained on the topic page Reinsurance
New value insurance indemnifies the cost of reinstating or replacing an insured item in new condition, without any deduction for age or wear and tear.
The no-claims class is the specific rating level of a motor insurance policy within the bonus-malus system, determined by the number of claims-free years driven.
The insurance non-discrimination rule prohibits differentiating premiums and benefits based on the sex of the insured person and led to the introduction of gender-neutral unisex tariffs.
A non-occupational accident (Nichtberufsunfall) under Art. 8 UVG is any accident that is not an occupational accident; in Switzerland employees working at least eight hours a week for the same employer are compulsorily insured against non-occupational accidents as well, with the NBU premium in principle charged to the employee.
Non-proportional reinsurance splits losses not according to a fixed percentage but according to loss severity: the reinsurer is liable only once a loss exceeds an agreed retention.
Insurance companies must promptly notify the supervisory authority of certain business events and changes, such as changes in board membership or significant changes in shareholdings.
Explained on the topic page Regulatory
The observation period is the historical timeframe whose data is used to calculate tariffs, reserves, or reinsurance premiums.
Explained on the topic page Actuarial
An occupational accident is an insured event under statutory accident insurance suffered by covered persons as a result of their work or insured activity.
Explained on the topic page Accident Insurance
An occupational accident (Berufsunfall) under Art. 7 UVG is an accident that an insured person suffers while performing work on the employer's instruction or in the employer's interest, during work breaks, or before and after work at the workplace; in Switzerland the premium for it is borne exclusively by the employer.
Occupational class rating assigns occupations to risk classes based on their risk profile, which significantly determines premium levels in disability and accident insurance.
Explained on the topic page Disability
Occupational disability exists when an insured person is, for the foreseeable long term, unable to continue practicing their most recently and specifically held occupation due to illness, injury, or loss of strength.
Explained on the topic page Disability
An occupational disease is an illness caused exclusively or predominantly by harmful substances or specific types of work in the course of employment and therefore compensated by statutory accident insurance like an accident; in Switzerland, Germany and Austria recognition is based on a statutory list, supplemented by a general clause for unlisted conditions.
Occupational pension commutation is the one-time lump-sum settlement of an occupational pension entitlement in place of ongoing pension payments.
Explained on the topic page Occupational Pensions
The BVG governs mandatory occupational pension provision in Switzerland and, as the second pillar alongside the AHV, aims to maintain the accustomed standard of living in old age, upon disability, and in the event of death.
The OAK BV is the Swiss federal authority ensuring the consistent application of supervision over second-pillar pension funds by the regional supervisory authorities.
Explained on the topic page Occupational Pension
The occurrence principle makes coverage of a liability loss dependent on the harmful event occurring during the current policy period, regardless of when the claim is asserted.
Explained on the topic page Liability Insurance
Off-premises cover extends property insurance to movable property located outside the insured location named in the policy, supplementing the location-bound base cover.
Explained on the topic page Property Insurance
The ÖGK is the largest carrier of statutory health insurance in Austria and covers benefits in kind such as medical treatment, hospitalisation, and medicines for employees.
The AHV is the first pillar of the Swiss pension system, a mandatory universal insurance designed to cover basic living costs in old age and upon the death of a breadwinner.
The old-age pension is the recurring benefit paid by the statutory pension scheme, or by a private or occupational pension arrangement, once the standard retirement age is reached.
Explained on the topic page Retirement Provision
The insurance ombudsman is an independent dispute resolution body that settles disputes between policyholders and insurers out of court and free of charge for the consumer.
An open cover is a framework insurance agreement in cargo insurance that automatically covers all of a policyholder's future shipments falling within defined terms, without requiring an individual declaration for each shipment.
Explained on the topic page Transport Insurance
An open cover policy is a framework policy that automatically insures all risks or shipments of a policyholder falling within its scope, without requiring individual declaration in advance.
Operating expenses for the insurance business comprise all costs an insurer incurs for acquisition, administration, and servicing of insurance contracts, alongside other underwriting expenses.
Explained on the topic page Accounting
Operational risk is the risk of loss resulting from inadequate internal processes, people, systems, or from external events, and is treated as a distinct risk category under Solvency II.
The option for lump-sum payment is a contractually granted right to choose a one-time payout of the accumulated technical reserve instead of the agreed lifetime annuity payment.
An order policy is an insurance document commonly used in cargo insurance that can be transferred by endorsement, tying the rights under the insurance contract to a person named in the document or to that person's order.
The ORSA is the firm-specific process every insurer must carry out under Solvency II to assess its overall solvency needs, taking into account its own particular risk profile.
Outpatient medical treatment is medical examination or treatment of an insured person that does not involve admission to a hospital, such as treatment by a physician in private practice.
Explained on the topic page Health Insurance
Outsourcing is the contractually agreed transfer of functions or activities of an insurer to a service provider that would otherwise be performed by the insurer itself, and is subject to specific regulatory requirements.
Over-insurance exists when the agreed sum insured significantly exceeds the actual insured value, meaning the policyholder is not entitled to a benefit exceeding that value in the event of a loss.
Own funds are an insurer's eligible capital under Solvency II that must be available to meet the solvency capital requirement.
Paid-up reduction refers to continuing a capital-forming life or annuity policy premium-free with a correspondingly reduced sum insured, when premium payments are discontinued.
Parental liability covers the liability parents or other persons responsible for a child's upbringing bear for losses caused by minor children in their care to third parties.
Explained on the topic page Liability Insurance
Partial retirement allows older employees a gradual transition into retirement by reducing working hours in exchange for partial wage compensation.
Explained on the topic page Retirement Provision
Participation in valuation reserves is the statutory entitlement under Section 153 VVG of German life insurance policyholders to a share of the hidden reserves attributable to their contract's investments.
Explained on the topic page Life Insurance
This financing method for social and pension systems sets contributions for a given period so that they cover exactly the benefits expected in that period plus the build-up of a fluctuation reserve.
In a pay-as-you-go system, the contributions currently paid by active contributors directly fund the current pension benefits paid to current beneficiaries, without building up an individual capital reserve.
The payment-to-reserve ratio relates the payments already made for a line of business's accident-year losses to the reserves additionally established for those same losses.
Explained on the topic page Reserving
The pension access factor is a factor used in Germany's statutory pension insurance that accounts for claiming the old-age pension earlier or later than the standard retirement age.
Explained on the topic page Pension insurance
The adjustment review duty requires employers to review, every three years, whether ongoing occupational pension benefits should be adjusted for inflation.
Explained on the topic page Occupational Pensions
The pension certificate is the annual document issued by a pension fund informing an insured person about their retirement savings and the expected benefits from occupational pension provision.
Explained on the topic page Occupational Pension
A pension fund is a legally independent occupational pension provider established by one or more sponsoring employers to provide retirement benefits to their employees.
Pension fund regulations are the rules issued by a pension fund that set out the specific rights and obligations of insured persons and the detailed benefits of occupational pension provision.
Explained on the topic page Occupational Pension
Under the offset method, benefits from the statutory pension scheme or other retirement systems are credited against an occupational pension promise to cap total retirement income.
Explained on the topic page Occupational Pensions
The per-capita premium (Kopfprämie) is the income-independent premium of Swiss basic health insurance: within a premium region and age class each insurer charges all insured persons the same premium (Art. 61 KVG); premiums require annual approval by the Federal Office of Public Health (Art. 16 KVAG) and may not vary by health status, sex or income.
A percentage reimbursement tariff is a health insurance tariff that reimburses medical treatment costs not in full, but only up to a percentage agreed in advance, often used to supplement other cost carriers.
Permanent total disablement (PTD) in personal accident wordings denotes the permanent, total and irrecoverable inability of an insured person, as a result of an accident, to engage in gainful occupation; it usually triggers a lump-sum benefit of 100 % of the sum insured.
Personal insurance is the overarching insurance category that covers risks directly attached to the person of the insured, particularly life, health, and earning capacity.
A petty claim is a loss of low value where the cost of processing and settling the claim is disproportionate to the loss amount itself.
Explained on the topic page Claims management
The Pflegegeld is an Austrian federal benefit that grants people in need of long-term care a flat-rate cash contribution towards care costs, regardless of income or assets.
Pillar 3a is the tax-privileged, tied form of private pension provision in Switzerland, whose savings can be accumulated up to an annual maximum and generally only withdrawn from the statutory reference age onward.
Pillar 3b is the untied form of private pension provision in Switzerland, whose capital is available at any time and is subject to few tax restrictions.
The place of performance is the location where a contractual obligation must be carried out, relevant to questions of jurisdiction and applicable law.
Explained on the topic page Contract Law
Policy acceptance is the insurer's declaration accepting the insurance application, thereby bringing the insurance contract into effect.
Explained on the topic page Contract Law
A policy condition (Obliegenheit) is a duty imposed on the policyholder whose culpable breach does not give rise to a damages claim but can lead to a reduction or denial of the insurer's benefit.
Storno refers to the early termination of an insurance contract before its regular expiry, in particular through termination, non-payment of premium, or withdrawal.
A policy loan is a loan granted by a life insurer to a policyholder against a pledge of the surrender value of a surrenderable life insurance policy.
The policy reserve is the actuarially calculated capital a life insurer must hold to meet the future benefit obligations of a contract.
Explained on the topic page Life Insurance
The policy term is the contractually agreed period during which an insurance contract is in effect, determining not only premium calculation but also cancellation and renewal terms.
Explained on the topic page Contract Law
An insurance pool is an arrangement among multiple insurers who jointly underwrite a particular risk according to a predetermined allocation formula, in order to pool capacity and expertise for hard-to-insure risks.
A portfolio transfer is the regulatory-approval-requiring transfer of an insurance portfolio from one insurer to another while preserving policyholder rights.
Explained on the topic page Regulatory
Post-employment coverage is the legally guaranteed, time-limited continuation of death and disability protection under occupational pension provision after an employment relationship ends, before a new pension relationship begins.
Explained on the topic page Occupational Pension
The pre-contractual duty of disclosure requires the applicant to truthfully and fully disclose to the insurer all known circumstances material to the risk.
Explained on the topic page Contract Law
A pre-existing condition is a medical condition that already existed before conclusion of the insurance contract, whose disclosure under the duty of disclosure is relevant to underwriting and the insurer's acceptance decision.
A preclusion period is a time limit upon whose expiry a right or claim is permanently extinguished, without requiring the debtor to raise a defense.
Explained on the topic page Contract Law
The premium is the consideration payable by the policyholder in exchange for the insurer's assumption of risk, and constitutes the policyholder's central principal obligation.
Explained on the topic page Contract Law
Premium adjustment is the statutorily regulated increase or decrease of premiums in German private health insurance when actual benefits paid deviate sustainably from calculated levels.
Explained on the topic page Health Insurance
Premium default is the failure to pay a subsequent premium on time, entitling the insurer, after an unsuccessful reminder, to be released from its obligation to pay or to terminate the contract.
Explained on the topic page Contract Law
Premium indexation automatically increases the premium and benefit of a life or annuity policy by an agreed percentage, usually without renewed underwriting.
Explained on the topic page Life Insurance
Premium payment is the policyholder's principal obligation under the insurance contract, timely performance of which is a precondition for continued coverage.
Explained on the topic page Contract Law
Premium payment default is a policyholder's failure to pay a due insurance premium on time, triggering a statutorily regulated reminder procedure with graduated legal consequences.
Premium payment frequency is the contractually agreed rhythm at which recurring insurance premiums are due – typically annual, semi-annual, quarterly or monthly.
Explained on the topic page Contract design
The premium payment warranty makes the commencement of substantive coverage dependent on timely payment of the first premium.
Explained on the topic page Contract Law
A premium refund is the partial repayment of premiums to private health insurance policyholders who made no or only minor claims in the prior observation period.
Explained on the topic page Health Insurance
The individual premium subsidy (IPV) is the social counterweight to the per-capita premium in Swiss basic health insurance: under Art. 65 KVG the cantons grant premium reductions to insured persons of modest means, co-financed by a federal contribution of 7.5 % of gross basic insurance costs (Art. 66 KVG).
A premium waiver relieves the policyholder of the obligation to pay further premiums while coverage continues unchanged to the agreed extent.
Explained on the topic page Disability
A premium waiver is a supplementary benefit under which the insurer covers further premiums upon a defined event, without coverage lapsing.
Present value is the value of future cash flows discounted to today, forming the basis of nearly every actuarial valuation.
Explained on the topic page Actuarial
The principal obligation is the central performance duty that characterizes a contract type; in an insurance contract, this is the provision of cover on the insurer's side and payment of the premium on the policyholder's side.
Explained on the topic page Contract Law
The principle of indemnity holds that a policyholder must not be economically better off as a result of the insurance payout than they would have been without the insured event.
Explained on the topic page Contract Law
The principle of indemnity holds that the insurance benefit must not place the policyholder in a financially better position than if the loss had not occurred, in order to prevent unjust enrichment through the occurrence of a claim.
The probable maximum loss (PML) is the largest loss expected at a location or for a risk under realistically adverse conditions; it serves as a measure of capacity and reinsurance requirements.
Profit commission is additional remuneration the reinsurer grants the cedent when a reinsurance treaty's loss experience is favorable.
Explained on the topic page Reinsurance
The progressive disability scale (Progression) is a benefit scale agreed in private accident insurance under which the disability benefit increases more than proportionately above a certain degree of disability and reaches a multiple of the base sum insured at full disability, with 225, 350 or 500 per cent being common market levels.
Proportional reinsurance splits premiums and losses between cedent and reinsurer according to a fixed percentage agreed in advance.
The prospective reserve method calculates the technical reserve as the present value of expected future insurance benefits less the present value of expected future net premiums.
The PVA is the largest carrier of statutory pension insurance in Austria and pays old-age, disability, and survivors' pensions to employees.
A qualified reminder notice is a written payment demand issued by the insurer upon default on a renewal premium, which must state the outstanding amount, a payment deadline, and the legal consequences of non-payment.
The qualifying salary is the gross salary recognised under the AHV Act, on the basis of which contributions to the first and second pillars, as well as the coordinated salary, are calculated.
Explained on the topic page Social Insurance
Random fluctuation risk is the component of an insurer's technical risk arising from the random dispersion of actual losses around the calculated expected loss, and it cannot be eliminated even with correctly estimated parameters.
Explained on the topic page Risk theory
In risk theory, random risk is the non-negative random variable describing the loss amount of an insured risk, forming the basic mathematical building block of actuarial models.
Explained on the topic page Risk theory
A rate (tariff) is the set of premium rates and rating factors defined by an insurer for a line of business or product, used to calculate the premium for a specific risk.
The reduction in earning capacity (MdE) is the percentage measure used by statutory accident insurance in Germany and Austria for the abstract loss of working opportunities across the entire field of gainful employment resulting from an insured event (§ 56 para. 2 SGB VII, § 203 ASVG); it is determined on the basis of medical experience values and governs the entitlement to and amount of the injury pension (Verletztenrente) or disability pension (Versehrtenrente).
Referral marketing acquires new customers through active recommendations from satisfied existing customers and is considered a particularly cost-effective distribution channel in insurance.
Explained on the topic page Distribution
Regional rating class is a motor insurance rating factor that classifies a vehicle owner's registration district into one of several risk classes based on the loss experience observed there.
The register of insurance intermediaries is a publicly accessible official record in which all licensed insurance intermediaries are listed and registered.
The Regular Supervisory Report is the confidential Solvency II report an insurer must periodically submit, containing detailed information exclusively for the supervisory authority.
Explained on the topic page Solvency II
Reinsurance acceptance is the legally binding acceptance of a reinsurance offer by the reinsurer, communicated to the primary insurer or reinsurance broker.
Explained on the topic page Reinsurance
A reinsurance audit is a reinsurer's review of a primary insurer's or reinsurer's business processes, typically conducted as an underwriting or claims audit.
Explained on the topic page Reinsurance
A reinsurance broker arranges and structures reinsurance contracts on behalf of a cedent and manages their placement in the market.
Explained on the topic page Reinsurance
A reinsurance deposit is a security amount withheld by the cedent or posted by the reinsurer to secure outstanding obligations under a reinsurance treaty.
Explained on the topic page Reinsurance
The reinsurer is the company that, for a premium, assumes risks or shares of risk from a primary insurer (the cedent) and provides it with a proportionate indemnity in the event of a loss.
Explained on the topic page Reinsurance
Relapse and late sequelae (Rückfall und Spätfolgen) denote, in accident insurance, the recurrence of an accident injury considered healed and the first appearance of accident consequences after a longer period, for which Swiss mandatory accident insurance pays under Art. 11 UVV even after the case has been closed, provided the causal link to the accident is more probable than not.
Removal damage is damage to insured property that occurs while it is being moved out of a space threatened by an insured peril, and is generally covered under property insurance.
Explained on the topic page Property Insurance
The supervisory authority may require the removal of an insurance company's management or supervisory board member where deficiencies are identified.
Explained on the topic page Regulatory
Replacement staff costs are the travel and accommodation expenses, covered under business travel accident insurance, for a substitute whom the employer sends to take over the business task of a traveller who is incapacitated by death, accident or serious illness – including the cost of the recovered person later resuming the assignment.
Replacement value is the amount required to newly acquire an insured item of the same type and quality, without regard to its age or wear.
Representative liability holds that a policyholder must accept responsibility for the conduct and knowledge of a person who independently manages the contract or the insured risk on their behalf.
Rescission allows the insurer to retroactively void the insurance contract if the policyholder fraudulently misrepresented facts material to the risk.
Explained on the topic page Contract Law
Reserving risk is the risk that an insurer's technical provisions established for losses already incurred are insufficient to cover the actual future payments required.
Explained on the topic page Actuarial
Restitution in kind is the reinstatement of the condition that would have existed absent the damaging event, as opposed to indemnification through a pure monetary payment.
Retention is the share of risk that a primary insurer or a company deliberately keeps for its own account instead of insuring or reinsuring it.
Explained on the topic page Risk financing
Retirement provision refers to the planned financial protection of one's standard of living in old age through state, occupational, and private pension products.
Retroactive cover extends the protection of a claims-made policy to breaches of duty committed before the start of the policy, provided they occurred after an agreed retroactive date.
Retrocession refers to the further transfer of a risk already assumed by a reinsurer to another reinsurer, known as the retrocessionaire.
Explained on the topic page Reinsurance
A return of premium rider is a supplementary annuity provision ensuring that, upon death before the annuity starts, the premiums paid are refunded to survivors.
Explained on the topic page Pension insurance
Reversal of the burden of proof shifts the general obligation to prove a claim from the claimant to the defendant, particularly in certain product liability and medical malpractice cases.
Explained on the topic page Liability Insurance
The Rezeptgebühr is the statutory co-payment that members of Austria's statutory health insurance must pay per prescribed medicine package.
The Riester allowance is Germany's state subsidy for private funded retirement provision, consisting of a basic allowance and a child allowance under sections 79 et seq. of the Income Tax Act (EStG).
Explained on the topic page Retirement Provision
The right of withdrawal allows a policyholder to cancel a newly concluded insurance contract retroactively within a statutory period, without giving reasons.
Riot is a political peril related to civil commotion in which parts of the population openly rise up against state authority, and is often written together with lockout as an extension of cover.
Explained on the topic page Property Insurance
A risk community is the pool of all persons insured by an insurer against a comparable risk, whose premiums form the basis for the risk equalisation calculated according to the law of large numbers.
Risk equalisation under Art. 16 et seq. KVG offsets differences in risk structure between Swiss health insurers: insurers with a below-average risk portfolio pay levies, insurers with above-average risk receive contributions; the indicators are age, sex, hospital or nursing home stay in the previous year and pharmaceutical cost groups (PCG). The scheme is run by the Common Institution under the KVG.
Risk loading is a margin added to the expected-value-based net premium, through which an insurer is compensated for the uncertainty of the loss estimate and the volatility of the risk assumed.
Robbery is the taking of insured property through the use or threat of force against a person, and is a distinct peril in burglary and robbery insurance.
Explained on the topic page Property Insurance
The run-off result is the difference between claims reserves established in prior years and the claims payments actually needed to settle those losses.
Explained on the topic page Actuarial
Sabotage refers to the intentional damage or destruction of property or business operations by third parties for political, ideological, or economic motives.
Salvage costs are expenses incurred to rescue, secure, or clear insured property in connection with an insured event, reimbursed by the insurer in addition to the sum insured.
Explained on the topic page Property Insurance
The schedule of disability percentages (Gliedertaxe) is the table agreed in private accident insurance conditions that assigns fixed degrees of disability to the loss or complete loss of function of specified body parts and sensory organs, thereby standardising the assessment of the disability benefit.
The scheme of operations is the description of planned business activity, organization, and financial resources an insurer must submit as part of its licensing application.
Explained on the topic page Regulatory
Scorching damage is heat damage to property without open flame, treated differently from fire damage in property insurance and regularly excluded from standard cover.
Second-loss cover is a higher layer borne exclusively by the reinsurer, which attaches only after the underlying layer carried by the primary insurer (first loss) has been exhausted.
Explained on the topic page Reinsurance
Security evacuation is the removal of an insured person to the nearest place of safety or to the country of residence, organised and paid for under business travel accident insurance, when political unrest, war, terrorism, natural disasters, expulsion or an official recommendation to leave make remaining in the host country unreasonable – as distinct from medically indicated evacuation.
Set-off is the declaration by which mutual, like-kind claims of two parties are extinguished to the extent they correspond in amount.
Explained on the topic page Contract Law
Sliding scale commission is a remuneration structure in proportional reinsurance where the commission rate moves inversely with the loss ratio within defined limits.
Explained on the topic page Reinsurance
Smaller mutual insurance associations below certain premium and membership thresholds may be wholly or partly exempt from ongoing insurance supervision.
Explained on the topic page Regulatory
Smoothing techniques spread short-term fluctuations in investment values or bonus declarations across multiple periods to stabilize outcomes for policyholders.
Explained on the topic page Actuarial
Social security affiliation of posted workers determines which national social security legislation applies to an employee temporarily working abroad: within the EU/EFTA and Switzerland, Regulation (EC) No 883/2004 provides that only one legislation applies at a time, and for postings of up to 24 months the legislation of the sending state continues to apply (A1 certificate); workers posted to Switzerland from treaty states may, under Art. 2 para. 5 KVV, be exempted on application from compulsory KVG insurance if the employer guarantees equivalent cover.
The SFCR is an insurer's annually published report under Solvency II that publicly discloses business activity, risk profile, valuation, and capital position.
Explained on the topic page Solvency II
Under Solvency II, the Solvency Capital Requirement is the capital an insurer must hold to remain solvent even in the face of an extreme event with a statistical return period of 200 years.
The solvency ratio relates an insurer's eligible own funds to its Solvency Capital Requirement, indicating the factor by which the regulatory minimum capital level is met.
Special Conditions supplement or modify the General Insurance Conditions for specific risks, target groups, or coverage extensions.
Explained on the topic page Contract Law
A special purpose vehicle (SPV) is a legally independent entity set up solely to issue securities through which insurance or credit risks are placed with capital market investors.
Special termination rights entitle either the insurer or the policyholder to end an insurance contract outside the ordinary renewal date, for example after a claim or on a change of ownership of the insured property.
The square meter method is a method for determining the insured value of a building based on its living or usable floor area and a per-square-meter price, frequently used to set the sum insured.
The statutory disability pension is a benefit of Germany's statutory pension insurance for partial or full reduction in earning capacity, which private disability income insurance can supplement.
Statutory health insurance is Germany's solidarity-based compulsory branch of social insurance providing medical care for the majority of the population.
A stress test examines how an insurer's financial position would develop under a hypothetical, exceptionally adverse scenario, to assess resilience and capital adequacy.
Strict liability is fault-independent liability attaching to the operation of a lawful but particularly hazardous object or activity.
Subrogation refers to an insurer's right, after indemnifying an insured, to pursue recourse against the tortfeasor or another liable third party in order to recover the amount paid.
The subsidiarity principle provides that an insurer is only secondarily liable for a loss if and to the extent that no other, primarily responsible insurance covers the same loss.
The suitability assessment requires an intermediary providing advice to gather and consider the customer's knowledge, experience, objectives, and financial situation.
Explained on the topic page Distribution
The sum insured is the contractually agreed maximum amount up to which the insurer pays in the event of a loss, and also the basis for premium calculation.
Explained on the topic page Contract design
The sum insured is the contractually agreed maximum amount up to which the insurer is liable for one or more insured events.
Explained on the topic page Contract Law
In group personal accident insurance the sum insured per insured person may be agreed as a multiple of annual salary instead of a fixed amount (typically, by way of illustration, 3 to 5 times); the benefit then automatically follows salary development but requires a clear salary definition, a maximum (salary cap) and the periodic declaration of payroll.
The supervisory board oversees the management board of an insurance company and, under the VAG, must be composed of professionally qualified and fit and proper members.
Explained on the topic page Regulatory
Supervisory orders are measures imposed by the supervisory authority requiring an insurance company to remedy identified deficiencies within a set period.
Explained on the topic page Regulatory
Supplementary benefits are means-tested payments made to AHV or IV pensioners when their pensions and other income fail to cover recognised basic living costs.
Supplementary insurance is an additional policy that extends an existing main contract, or statutory social insurance cover, with extra benefits.
Explained on the topic page Health Insurance
Supplementary pension provision forms the second pillar of retirement provision in Germany, mainly comprising the Riester pension and occupational pension schemes.
Explained on the topic page Retirement Provision
The supplementary pension scheme for public sector employees is a collectively agreed occupational pension system for employees in the German public sector.
Explained on the topic page Retirement Provision
Supply pipes carry fresh water or gas into a building; breakage damage to them inside the building is typically covered under the escape-of-water peril.
Explained on the topic page Property Insurance
A suretyship is the civil law contract by which a surety undertakes to the creditor to answer for the performance of a third party's obligation.
Explained on the topic page Credit Insurance
Surplus share reinsurance is a form of proportional reinsurance in which the reinsurer assumes only the portion of a sum insured exceeding a retention line set by the ceding insurer.
Surrender value is the amount a life insurer pays to the policyholder upon early termination of a capital-forming policy; it corresponds to the policy reserve less a surrender charge.
The survival benefit is the lump sum or annuity payment a life insurer provides when the insured person survives the contract's agreed maturity date.
Explained on the topic page Life Insurance
A survivor's pension is a recurring benefit from a life or annuity insurance policy or a retirement system, paid to a spouse, registered partner, or children following the death of the insured person.
Explained on the topic page Life Insurance
Suspension temporarily halts a contract's cover and premium obligation; reinstatement restores full cover once the reason for suspension has ceased to apply.
SUVA is the largest provider of mandatory accident insurance in Switzerland, insuring in particular businesses in the trade and industrial sectors.
The administration of compulsory accident insurance in Switzerland is split in two: businesses in the industries listed in Art. 66 UVG are compulsorily insured with Suva, while all other employers choose a registered private insurer, a public accident insurance fund or a health insurer (Art. 68 UVG); the UVG substitute fund (Ersatzkasse, Art. 72 f. UVG) covers employees of employers who have failed to insure.
SwissDRG is the case-based flat-rate system for acute inpatient hospital services in Switzerland in force since 2012 (Art. 49 KVG): each hospital stay is assigned to a diagnosis related group with a cost weight and multiplied by the hospital-specific base rate; the remuneration is shared between the canton of residence (at least 55 %) and the health insurer (at most 45 %) under Art. 49a KVG.
The table of benefits (also table of events or continental scale) is the schedule contained in international personal accident wordings that assigns a fixed percentage of the sum insured to each insured event – death, loss of limbs, sight, hearing or permanent disablement – and is thus the counterpart to the German-style schedule of disability percentages (Gliedertaxe).
TARMED was Switzerland's nationwide fee-for-service tariff for outpatient physician services from 2004 to 2025; since 1 January 2026 it has been replaced by the overall tariff system approved by the Federal Council, consisting of TARDOC (fee-for-service tariff with around 1,400 items) and around 300 outpatient flat rates, maintained by OAAT AG. Remuneration equals tax points multiplied by the cantonal tax point value.
The tax treatment of employer-funded group personal accident insurance governs whether and when contributions count as wages: in Germany the inflow depends on whether employees have a direct claim, and wage tax may be levied at a flat rate of 20 % under section 40b (3) EStG; in Switzerland employer contributions to collective supplementary UVG insurance need not be declared on the salary certificate; in Austria contributions for future security are tax-free up to EUR 300 per year.
The technical interest rate is the prudently set actuarial interest rate used in life insurance premium and reserve calculations to reflect future expected investment returns, and is guaranteed to the policyholder.
Technical provisions are an insurer's balance-sheet obligations to policyholders arising from existing contracts, in particular for future benefits and claims not yet fully settled.
Temporary total disablement (TTD) is the temporary inability of an insured person, as defined in personal accident wordings, to carry out their usual occupation as a result of an accident; it is compensated by a weekly benefit that is limited to salary or a share of salary, subject to an excess period and restricted to a maximum benefit period.
Tenant's legal liability covers damage a tenant causes to the leased property and for which they are legally liable to the landlord; personal liability insurance regularly covers this risk as an included benefit.
Termination is the unilateral declaration by a contracting party ending an insurance contract, either on notice at the end of a defined period or extraordinarily on a specific triggering event.
Territory protection grants an exclusive agent the right to be protected from competition by other agents of the same insurer within a defined geographic area.
Terrorism insurance covers property and business interruption losses caused by acts of terrorism, and is frequently offered separately from standard cover due to the difficulty of calculating the risk.
Theft is the unlawful taking of another's movable property with intent to appropriate it, and one of the central perils in property insurance.
A third-party beneficiary acquires an independent right of claim from a contract between two other parties, without itself being a party to that contract.
Explained on the topic page Contract Law
Third-party loss liquidation allows a contracting party to assert, in its own name, a loss that has occurred at a third party due to a special legal relationship.
Explained on the topic page Liability Insurance
The three-pillar system is the constitutionally enshrined basic structure of Swiss old-age, survivors', and disability provision, consisting of state, occupational, and private pension provision.
Tiers garant and tiers payant are the two reimbursement systems of Swiss health insurance under Art. 42 KVG: under tiers garant the insured person owes the provider's fee and is reimbursed by the insurer; under tiers payant the insurer owes the fee directly to the provider. For inpatient treatment tiers payant applies by law.
The total declared rate is the sum of the guaranteed interest rate and the current bonus a life insurer actually credits to policyholders in a given year.
Explained on the topic page Life Insurance
A total loss occurs when an insured object is completely destroyed, irretrievably lost, or no longer economically reasonable to repair.
Trail commission is ongoing remuneration paid to an intermediary for servicing an existing insurance contract after it has been concluded.
Explained on the topic page Distribution
The travel days declaration is the premium basis of business travel accident insurance: at inception the employer reports the estimated number of travel days or trips for the policy year, the premium is calculated provisionally on that basis and adjusted at year-end or renewal against the actual figures; alternatively the policy is rated on headcount.
Treaty adjustment is the contractual alignment of a reinsurance treaty with actual business performance, achieved through variable premiums or sliding scale commissions.
Explained on the topic page Reinsurance
Treaty reinsurance is a form of reinsurance in which the reinsurer is obliged to automatically accept all risks of a defined portfolio ceded by the cedent.
Explained on the topic page Reinsurance
The cancellation, curtailment and delay module of business travel accident insurance reimburses cancellation charges, unused travel services and additional costs of return or onward travel when a business trip cannot be started, has to be cut short or is continued late because of an insured event – sickness, accident, death, natural event, civil unrest, strike or cancellation of the business appointment.
In reinsurance, ultimate net loss refers to the total loss amount ultimately borne by the ceding insurer after deducting other applicable reinsurance and recoveries, but before application of the reinsurance treaty itself.
Underinsurance exists when the agreed sum insured is lower than the actual insured value; the indemnity is then reduced in accordance with the proportionality rule.
Underwriting is the process of risk assessment, selection and pricing by which an insurer decides whether, and on what terms, to accept a risk.
Explained on the topic page Underwriting
Underwriting cycle management is the management approach that systematically factors the alternation between hard and soft insurance markets into corporate and competitive strategy.
Underwriting policy comprises an insurer's objective and resource decisions on accepting insured risks, including underwriting limits, retentions and risk premiums.
Explained on the topic page Underwriting
The underwriting year is the year in which a contract's risk period begins, and it serves as the reference basis for underwriting, reserving and results analysis in primary and reinsurance business.
Explained on the topic page Reinsurance
The unearned premium reserve is the technical provision for the portion of written premium that economically relates to a coverage period after the balance sheet date.
Explained on the topic page Accounting
The ALV is the Swiss social insurance scheme that pays daily allowances to insured employees in the event of involuntary unemployment, short-time work, weather-related work stoppages, and employer insolvency.
Explained on the topic page Social Insurance
Utmost good faith obliges both policyholder and insurer to act honestly and in mutual trust throughout the formation, performance, and claims settlement of an insurance contract.
The UVG daily allowance is the income replacement benefit of Swiss accident insurance for accident-related incapacity for work; under Art. 17 UVG it amounts to 80 percent of the insured earnings for full incapacity and is paid from the third day after the day of the accident until working capacity is regained or a pension begins.
The UVG disability pension is the long-term benefit of Swiss compulsory accident insurance for accident-related disability of at least 10 percent (Art. 18 UVG); it amounts to 80 percent of the insured earnings for full disability and, where it coincides with an IV or AHV pension, is paid as a complementary pension up to 90 percent of the insured earnings (Art. 20 UVG).
A valuation reserve is the hidden reserve that arises when the market value of an investment exceeds its lower statutory book value.
Explained on the topic page Investments
Vehicle type class is a motor insurance rating factor that classifies a vehicle model into one of several risk classes based on the model-specific loss experience observed for it.
Venue determines which court has territorial jurisdiction over a dispute arising from an insurance contract, with consumer protection rules limiting contractual agreements.
Explained on the topic page Contract Law
Vested benefits are the retirement savings accrued in occupational pension provision that must be transferred to a new pension fund, or otherwise preserved, when leaving a pension fund.
Vesting refers to the preservation of an already accrued entitlement to an occupational pension benefit even after early departure from employment before the pension event occurs.
A vicarious agent is a person who, with the debtor's knowledge and consent, assists in performing the debtor's obligation, and for whose fault the debtor is liable.
Explained on the topic page Liability Insurance
Vicarious liability refers to the liability of a principal or contracting party for losses caused by persons engaged to carry out their business operations or contractual obligations.
The victim's priority right provides that an injured party who was not fully indemnified by their own insurer is satisfied out of the tortfeasor's remaining assets before their insurer's subrogated recourse claim.
Voluntary insurance allows membership in Germany's statutory health insurance for people no longer, or not yet, subject to compulsory insurance.
The waiting period is the period after inception of a contract during which no cover yet exists for certain or all benefits.
Waiver of premium is a supplementary life insurance benefit under which the insurer assumes the ongoing premium payment obligation if the policyholder becomes disabled, without reducing insurance cover.
Water damage from pipes arises when water escapes improperly from supply or drainage pipes, water-carrying installations, or connected appliances, and is one of the standard base perils covered by homeowners and contents insurance.
Explained on the topic page Property Insurance
Wilful intent refers to a policyholder knowingly and deliberately causing an insured event, which is mandatorily excluded from cover in almost all lines of insurance.
Windstorm is a weather-related air movement reaching a contractually defined minimum wind speed, insured as a natural hazard peril in property insurance.
The WZW criteria under Art. 32 KVG require that benefits of Swiss basic health insurance be effective (wirksam), appropriate (zweckmässig) and cost-effective (wirtschaftlich); effectiveness must be demonstrated by scientific methods. They are the central benefit condition of the OKP and the counterpart to the cost-effectiveness principle of § 12 SGB V in Germany.
The yield curve shows how the yields of comparable bonds depend on their remaining maturity at a given point in time, and it forms the basis for the market-consistent valuation of insurers' future payment obligations.
Explained on the topic page Solvency
The York-Antwerp Rules are the internationally recognized, privately agreed set of rules for the uniform calculation and apportionment of general average losses in maritime shipping.
The Zillmer premium is the net premium of a life insurance policy, increased by the acquisition cost loading determined through zillmerisation and annuitised over the premium payment period.
Explained on the topic page Life Insurance
The Zillmer rate is the supervisory-capped percentage used to calculate the acquisition cost loading in life insurance under zillmerisation.
Explained on the topic page Life Insurance
The Zillmer reserve is the technical reserve of a life insurance policy built up using the Zillmer premium.
Explained on the topic page Life Insurance
Zillmerisation, named after actuary August Zillmer, is the premium calculation method used to finance a life insurance policy's acquisition costs through the ongoing premiums.
Explained on the topic page Life Insurance