Early Retirement: Retirement of a participant prior to the normal retirement date,
usually with a reduced amount of annuity. Early retirement is generally allowed at any
time during a period of 5 to 10 years preceding the normal retirement date.
Earned Income: Employment income derived from salary, wages, commissions, or fees.
Earned Premium: The part of the total property/casualty policy premium which
applies to the portion of the policy period which has already expired.
Earned Premium: The portion of a premium which is the property of an insurance
company, based on the expired portion of the policy period. E.g., a $300 premium for a one
year policy beginning July 1 would amount to an earned premium of $150 the following
January 1.
Earned Premium: That portion of a policy's premium payment for which the protection
of the policy has already been given. For example, an insurance company is considered to
have earned 75 percent of an annual premium after a period of nine months of an annual
term has elapsed.
Earnings Test (retirement test): Determination of the amount of Social Security
benefits payable to a beneficiary after adjusting for earnings. The amount of earnings
allowed before his or her benefits is indexed annually; benefits are reduced by $1 for
every $3 of earnings (beginning in 1990) above the earnings test threshold.
Economic Loss: The estimated total cost, both insured and uninsured, of mishaps
(such as motor vehicle accidents, work accidents, and fires); includes such factors as
property damage, funeral expenses, wage loss, insurance administration costs, and medical,
hospital and legal costs.
Effective Date: The date on which the insurance under a policy begins.
Elements of a Negligent Act: Four elements an injured person must show to prove
negligence: existence of a legal duty to use reasonable care, failure to perform that
duty, damages or injury to the claimant, and proximate cause relationship between the
negligent act and the infliction of damages.
Elimination Period: A period of time between the period of disability and the start
of disability income insurance benefits, during which no benefits are payable. (See
Waiting Period.)
Elimination Period: A specified number of days at the beginning of each period of
disability during which no disability income benefits are paid. The elimination period may
be as short as a few days or as long as one year or more.
Embezzlement: Fraudulent use or taking of another's property or money which has been
entrusted to one's care.
Employee Dishonesty Coverage Form: Commercial crime insurance form drafted by the
Insurance Services Office that covers the loss of money, securities, and other covered
property because of any dishonest act of a covered employee or employees.
Employee Retirement Income Security Act (ERISA): Legislation passed in 1974
applying to most private pension and welfare plans that requires certain minimum standards
to protect participating employees.
Endorsements: An additional piece of paper, not a part of the original contract,
which cites certain terms and which, when attached to the original contract, becomes a
legal part of that contract.
Endorsement: An amendment of the policy usually by means of a rubber stamp or
rider.
Enrolled Actuary: A person who performs actuarial service for a plan and who is
enrolled with the Federal Joint Board for the Enrollment of Actuaries.
Environmental Impairment Liability Insurance: A form of insurance designed to
cover losses and liabilities arising from damage to property by pollution.
Equities: Investments in the form of ownership of property, usually common stocks,
as distinguished from fixed income bearing securities, such as bonds or mortgages.
Equity in the Unearned Premium Reserve: Amount by which an unearned premium reserve
is overstated because it is established on the basis of gross premium rather than net
premium.
ERISA: See Employee Retirement Income Security Act.
Errors and Omissions Insurance: Liability insurance policy that provides protection
against loss incurred by a client because of some negligent act, error, or omission by the
insured.
Estate: The assets and liabilities of a person left at death.
Estate Planning: Developing a plan to transfer all of your property from one
generation to the next or within a generation.
Estoppel: Legal doctrine that prevents a person from denying the truth of a
previous representation of fact, especially when such representation has been relied on by
the one to whom the statement was made.
Excess and Surplus Insurance: (1) Insurance to cover losses above a certain amount,
with losses below that amount usually covered by a regular policy. (2) Insurance to cover
an unusual or one-time risk, e.g., damage to a musician's hands or the multiple perils of
a convention, for which coverage is unavailable in the normal market. (See also "Umbrella
liability" and "surplus lines.")
Exclusions: Specific conditions or circumstances listed in the policy for which the
policy will not provide benefit payments.
Exclusive Agent: An agent who is employed by one and only one insurance company and
who solicits business exclusively for that company.
Exclusive Remedy Doctrine: Doctrine in workers compensation insurance which states that
workers compensation benefits should be the exclusive or sole source of recovery for
workers who have a job related accident or disease; doctrine has been eroded by legal
decisions.
Exclusion or Exception: Specified conditions or circumstances, listed in the policy,
for which the policy will not provide benefits.
Expense Loading: See Loading.
Expense Ratio: The ratio of a company's operating expenses to premiums.
Experience: A term used to describe the relationship, usually expressed as a
percent or ratio, of premium to claims for a plan, coverage, or benefits for a stated time
period.
Experience Modification Factor: Used in workers compensation rating to reflect the
degree to which a particular employer has experience that is better or worse that expected
for that industry. Weighted by employer's credibility factor.
Experience Rating: The process of determining the premium rate for a group risk, wholly
or partially on the basis of that group's experience.
Experience Refund: A provision in most group policies for the return of premium to
the policyholder because of lower than anticipated claims.
Exposure Unit: Unit of measurement used in insurance pricing.
Extended Coverage Insurance: Protection for the insured against property damage
caused by windstorm, hail, smoke, explosion, riot, riot attending a strike, civil
commotion, vehicle and aircraft. This is provided in conjunction with the fire insurance
policy and the various "package" policies.
Extended Non owned Coverage: Endorsement that can be added to an automobile
liability insurance policy that covers the insured while driving any non owned automobile
on a regular basis.
Extended Reporting Period: An additional period of time after policy expiration
during which valid claims will be paid under a claims-made policy of liability insurance.
Extended Reporting Period Endorsement: Added to a claims-made policy of liability
insurance to provide additional period of time during which valid claims will be paid.
Extended Term Insurance: A form of insurance available as a non forfeiture option.
It provides the original amount of insurance for a limited period of time.
Extended Unemployment Insurance Benefits: Additional cash benefits paid by federal
state unemployment insurance programs to workers who are involuntarily unemployed and who
have exhausted their regular weekly cash benefits during periods oh high unemployment.
Extortion: Surrender of property away from the premises as a result of a threat to
do bodily harm to the named insured, relative, or invitee who is being held captive.
Extra Expense Insurance: Type of business income insurance that covers the extra
expenses incurred to continue operations after a loss has occurred.
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