BIBF Professional Award for Specialist Insurance Practitioner key terms

A legal requirement that the policyholder gains from the subject matter surviving or suffers loss from its damage, ensuring insurance is not a wager.

The rule that a property or liability claim payment should restore the insured to roughly the financial position held before the loss, no better and no worse.

The mutual duty on proposer and insurer to deal openly and disclose material facts fairly, underpinning fair pricing and lawful avoidance remedies.

Any circumstance that would influence a prudent underwriter's decision to accept a risk or set its terms and premium.

The insured's duty to disclose every material circumstance it knows or ought to know, in a reasonably clear and accessible manner, before cover is bound.

A court remedy for non-disclosure that scales the claim payment to the premium actually paid relative to the premium that would have been charged had the risk been disclosed.

The insurer's right, after paying a claim, to stand in the insured's shoes and recover the loss from the party legally responsible for causing it.

The principle allowing several insurers covering the same interest and risk to share a loss so no insured recovers more than the total loss.

An improvement in the insured property's condition arising from repair or replacement, which insurers may deduct so the insured does not profit from a claim.

The risk that an insured's behaviour becomes less careful, or a loss is deliberately caused, because insurance removes the financial consequence.

The risk that an insured's behaviour becomes less careful, or a loss is deliberately caused, because insurance removes the financial consequence.

A property policy condition reducing claim payments proportionally when the sum insured is less than the full value at risk at the time of loss.

A property cover basis that repairs or rebuilds damaged property to its pre-loss condition without deducting for age or wear, usually subject to a sum insured.

Cover compensating lost trading profit and continuing fixed costs when insured damage interrupts the business, measured over an indemnity period.

The maximum period, starting from the date of damage, over which business interruption losses are calculated and paid.

Reasonable additional expenditure incurred to maintain business operations and reduce interruption loss, often subject to a financial limit.

The business interruption measure of turnover plus closing stock less purchases and specified working expenses, representing the earnings exposed to interruption.

A liability policy trigger responding to injury or damage that happens during the policy period, regardless of when the claim is later made.

A liability policy trigger responding only to claims first made and notified during the policy period, usually with a retroactive date limiting prior acts.

The date before which acts or circumstances are excluded under a claims-made liability policy, protecting insurers from unknown historic exposure.

The maximum total an insurer will pay across all claims in a policy period, distinct from the per-occurrence limit applying to each individual loss.

The maximum amount payable for any single loss event, applying separately to each occurrence until any aggregate limit is exhausted.

The policy wording that determines what counts as one loss occurrence, critical for applying deductibles and limits to catastrophe or serial losses.

Reinsurance arranged case by case for an individual risk, allowing the reinsurer to accept or decline each submission independently.

An agreement under which the reinsurer automatically accepts a defined class or portfolio of risks that fall within pre-agreed terms.

A proportional reinsurance arrangement where the reinsurer accepts a fixed percentage of every risk's premium and loss within the treaty scope.

A proportional reinsurance treaty ceding the amount by which a risk exceeds the insurer's retained line, up to a stated number of lines.

Non-proportional reinsurance where the reinsurer pays losses above a retention up to a limit, protecting against severe single losses or catastrophes.

The loss or retention level at which a reinsurance layer begins to respond, expressed as an amount or as a proportion of the subject premium.

A maritime principle requiring cargo, ship and freight interests to share proportionately in extraordinary sacrifices or expenses made deliberately to save the venture.

Partial damage to a specific insured item in a marine venture, borne by that interest alone rather than shared across the whole adventure.

A marine loss where the subject matter is abandoned because damage or deprivation makes recovery economically unviable relative to its insured value.

Property saved from a loss, or the cost of saving it, which affects claim settlement and the insurer's recovery rights.

Cyber cover responding to third-party claims and regulatory costs arising from data breaches, network failures or breaches of confidentiality obligations.

Unintended cyber exposure arising where traditional property or liability wordings neither explicitly include nor clearly exclude cyber-related loss.

Cover for ransom demands, negotiation costs and associated disruption following a threatened or actual attack on the insured's systems or data.

A construction or property exclusion removing cover for loss caused by faulty design, workmanship or materials in the insured's own structure.

A hidden flaw in design, materials or workmanship that only becomes apparent after completion and may trigger cover under a defects clause.

Liability cover for claims alleging negligent advice, error or omission in the professional services the insured supplies to clients.

A situation where a practitioner's personal, financial or other interests could improperly influence decisions owed to clients, employers or the market.

A regulatory expectation that firms deliver good outcomes for retail customers, requiring fair value, clear communications and suitable products.

The principle that firms must demonstrate fair treatment of customers throughout product design, sales, servicing and claims processes.

The protected reporting of wrongdoing or misconduct within a firm, supported by procedures that shield the reporting individual from detriment.