Insurance Information
Family Purpose Doctrine
Concept that imputes negligence committed by immediate family members while operating a family car to the owner of the car

Farmowners-Ranchowners Policy
A package policy for a farm or a ranch, providing property and liability coverages against personal and business losses.

Federal Crime Insurance
Insurance against burglary, larceny, and robbery losses offered by the federal government where the Federal Insurance Administration has determined that an insurance availability problem exists.

Federal Crop Insurance
Comprehensive coverage at rates subsidized by the federal government for unavoidable crop losses, including those that result from hail, wind, excessive rain, drought, freezes, plant disease, snow, floods, and earthquake.

Federal Flood Insurance
Insurance sold by private insurers with rates subsidized by the federal government to persons who reside in flood zones and whose community joins the program and agrees to establish and enforce flood control and land-use measures.

Fiduciary
A person holding the funds or property of another in a position of trust, and who is obligated to act in a prudent and ethical manner. An example would be an attorney, bank trustee, the executor of an estate, etc.

File and Use
Regulatory rule whereby the insurer must have rates, rules, and/or forms on file with a department of insurance prior to implementing them.

Financial Responsibility Law
A state law which may require motorists (the insured) to furnish evidence, either before or after involvement in an auto accident (depending on the individual state's law), of ability to pay for damages up to certain minimum dollar limits. These requirements commonly are met by carrying auto liability insurance with specified minimum limits or more.

Fire
A combustion accompanied by a flame or glow, which escapes its normal confines to cause damage.

Fire Insurance
Coverage for losses caused by fire and lightning, plus resultant damage caused by smoke and water.

First Party Coverage
An insurance coverage under which the policyholder collects compensation for losses from the insured's own insurer rather than from the insurer of the person who caused the accident.

Flat Cancel
Cancellation of an insurance contract as of its date of inception, without premium charge.

Floaters
Insurance policies that cover property that can be moved from one location to another for both transportation perils and perils affecting property at a fixed location.

Flood Insurance
Insurance sold by private insurers with rates subsidized by the federal government to persons who reside in flood zones and whose community joins the program and agrees to establish and enforce flood control and land-use measures.

Foreign Insurer
An insurance company licensed to operate in a state but has its home office in another state.

Franchise Insurance
Insurance under individual contracts issued to the employees of a common employer or the members of an association under an arrangement by which the employer or association agrees to collect the premiums and remit them to the insurer. The insurer usually agrees to waive its right to discontinue or modify any individual policy, unless its simultaneously discontinues or modifies all other policies in the same group.

Fraternal Insurance
A cooperative type of insurance provided by social organizations, such as members of a lodge or a fraternal order, for their members.

Fronting Company
An insurer that issues policies with the intention of transferring most of the insured exposure through reinsurance or other means to unauthorized insurers or reinsurers or captive insurers. This fronting insurer assumes little or no loss exposure; instead, financial arrangements are made to guarantee claims administration and payments. The fronting insurer is usually paid a percentage of the premium.

Insurance Information (cont'd)
Occupational Hazards
Occupations which expose the insured to greater than normal physical danger by the very nature of the work in which the insured is engaged, and the varying periods of absence from the occupation, due to the disability, that can be expected.

Occurrence
An accident, including continuous or repeated exposure to substantially the same general, harmful conditions, that results in bodily injury or property damage during the period of an insurance policy.

Occurrence policy
A liability insurance policy that covers claims arising out of occurrences that take place during the policy period, regardless of when the claim is filed.

Ocean Marine Insurance
Insurance for sea-going vessels, including liabilities connected with them, and their cargoes.

Ocean Marine Insurance
Coverage on all types of vessels, including liabilities connected with them, and on their cargoes.

Operating Ratio
The sum of expenses and losses expressed as a percent of earned premium.

Optionally Renewable Contract
A contract of health insurance in which the insurer reserves the right to terminate the coverage at any anniversary or, in some cases, at any premium due date, but does not have the right to terminate coverage between such dates.

Ordinary Life
Synonymous With Whole Life and Straight Life - The three terms are applied to the type of policy which continues during the whole of the insured's life and provides for the payment of amount insured at this death.

Ordinary Life Insurance
Life insurance usually issued in amounts of $1,000 or more with premiums payable on an annual, semi-annual, quarterly or monthly basis.

Over-the Counter Market
A means of buying and selling securities that are not listed on a stock exchange. Negotiations are carried out by telephone or computer network.

Overhead Expense Insurance
A special form of health insurance designed to help offset overhead expenses such as office rent, utilities, employees' wages, and auditors' fees, incurred during total disability. The monthly payments during disability is not a fixed amount of indemnity as on regular disability polices, but the amount of overhead expense actually incurred, or a percentage thereof, up to the limit specified in the policy.

Overhead Insurance
A type of short-term disability income contract that reimburses the insured person for specified, fixed monthly expenses, normal and customary in the operation and conduct of his/her business or office.

Overriding Commission (Overwrite)
A commission paid to general agents or agency managers in addition to the commission paid the soliciting agent or broker.