CPHRM Risk Financing
Domain
Actuary
Noun - ANSWERSA person who uses statistics to compute loss probabilities to establish
premiums for insurance companies and self-insurance trusts.
Boiler and Machinery Coverage - ANSWERSProvides protection for explosion of boilers and
other pressure vessels and accidental damage to equipment.
Business Interruption Insurance Coverage - ANSWERSInsurance coverage typically provided as
part of a property insurance policy covering the lost revenues and extra operating expenses
associated with a covered loss such as a fire; attempts to replace revenues lost due to covered
loss.
Captive - ANSWERSAn insurance company formed by an employer to assume its workers'
compensation and other risks, and provide services.
Captive - ANSWERSAn insurance company established to provide coverage to a sponsoring
entity as opposed to marketing and selling policies commercially to insureds; the sponsoring
entity may be a parent insurance carrier, policy period, policy number, etc.
Certificate of Insurance - ANSWERSA standardized form- usually produced by the insurance
agent or broker who arranges the coverage - that officially outlines the specific type of
insurance in place, the insurance carrier, policy period, policy number, etc.
Claims-Made Coverage - ANSWERSProvides coverage for a claim that occurred after the
inception or retroactive coverage date of the policy and is reported to the insurance company
while the policy or any replacement policy is still in affect.
, Cost of Risk - ANSWERSValue of all risks, internal and external, faced by an organization in
fulfilling its mission.
Deductible - ANSWERSAmount required to be paid by the insured before the insurer will make
payment for the eligible loss as stipulated under the insurance contract; typically erodes the
maximum benefit provided.
Direct Insurance - ANSWERSA contractual arrangement involving the purchase of insurance by
an insured from an insurer.
Directors and Officers Liability - ANSWERSD&O policies contain a two-part wrongful act
definition:
*Any actual or alleged error or misstatement or misleading statement or act or omission or
breach of duty by directors and officers while acting in their individual or collective capacities.
*Any matter claimed against them solely by reason of their being directors or officers of the
company.
Errors and Omissions insurance: E&O insurance polices provide coverage for negligent advice or
business services provided by an individual or entity not eligible for professional liability
insurance coverage, such as billing companies, insurance brokers and managed care
organizations.
Fiduciary Liability - ANSWERSInsurance coverage policy that can be purchased to cover the
alleged breach of the fiduciary responsibility under common law or ERISA for individuals who
exercise managment or administrative responsibilities for its employee benefit plans.
First Party Insurance Coverage - ANSWERSProvides coverage for the insured's own property or
person so that the insured will be restored to the same financial position that he or she had
prior to the loss.
Fronting - ANSWERSThe use of a licensed, admitted insurer to issue an insurance policy on
behalf of a self-insured organization or captive insurers without the intention of transferring any
Domain
Actuary
Noun - ANSWERSA person who uses statistics to compute loss probabilities to establish
premiums for insurance companies and self-insurance trusts.
Boiler and Machinery Coverage - ANSWERSProvides protection for explosion of boilers and
other pressure vessels and accidental damage to equipment.
Business Interruption Insurance Coverage - ANSWERSInsurance coverage typically provided as
part of a property insurance policy covering the lost revenues and extra operating expenses
associated with a covered loss such as a fire; attempts to replace revenues lost due to covered
loss.
Captive - ANSWERSAn insurance company formed by an employer to assume its workers'
compensation and other risks, and provide services.
Captive - ANSWERSAn insurance company established to provide coverage to a sponsoring
entity as opposed to marketing and selling policies commercially to insureds; the sponsoring
entity may be a parent insurance carrier, policy period, policy number, etc.
Certificate of Insurance - ANSWERSA standardized form- usually produced by the insurance
agent or broker who arranges the coverage - that officially outlines the specific type of
insurance in place, the insurance carrier, policy period, policy number, etc.
Claims-Made Coverage - ANSWERSProvides coverage for a claim that occurred after the
inception or retroactive coverage date of the policy and is reported to the insurance company
while the policy or any replacement policy is still in affect.
, Cost of Risk - ANSWERSValue of all risks, internal and external, faced by an organization in
fulfilling its mission.
Deductible - ANSWERSAmount required to be paid by the insured before the insurer will make
payment for the eligible loss as stipulated under the insurance contract; typically erodes the
maximum benefit provided.
Direct Insurance - ANSWERSA contractual arrangement involving the purchase of insurance by
an insured from an insurer.
Directors and Officers Liability - ANSWERSD&O policies contain a two-part wrongful act
definition:
*Any actual or alleged error or misstatement or misleading statement or act or omission or
breach of duty by directors and officers while acting in their individual or collective capacities.
*Any matter claimed against them solely by reason of their being directors or officers of the
company.
Errors and Omissions insurance: E&O insurance polices provide coverage for negligent advice or
business services provided by an individual or entity not eligible for professional liability
insurance coverage, such as billing companies, insurance brokers and managed care
organizations.
Fiduciary Liability - ANSWERSInsurance coverage policy that can be purchased to cover the
alleged breach of the fiduciary responsibility under common law or ERISA for individuals who
exercise managment or administrative responsibilities for its employee benefit plans.
First Party Insurance Coverage - ANSWERSProvides coverage for the insured's own property or
person so that the insured will be restored to the same financial position that he or she had
prior to the loss.
Fronting - ANSWERSThe use of a licensed, admitted insurer to issue an insurance policy on
behalf of a self-insured organization or captive insurers without the intention of transferring any
