Xcel Terms - CHAPTER 1 - PART 1

 Actuarial Department

This is the department that calculates policy rates, reserves, and dividends.

Adjuster

This is the person who investigates claims and arranges for them to be settled or denied.

Alien Insurer

In the United States, this is an insurer whose principal office and domicile location is outside this country.

Admitted Insurer

This is an insurer who has received a certificate of authority from a state’s department of insurance which authorizes them to conduct insurance business in that state.

Agent

This is an individual or organization that’s authorized to solicit, sell, and transact (bind) coverage for specific insurance providers under the terms of one or more agent contracts.

Authorized Insurer

This is an admitted insurer.

Broker

This is a person who represents himself and the insured (i.e., the client or customer). A broker cannot bind coverage on behalf of an insurance carrier because a broker is not appointed as an agent.

Captive Insurer

This is an insurer that’s established and owned by a parent firm for the purpose of insuring the parent firm’s loss exposure.

Certificate of Authority

This is a license that’s issued to an insurer by an insurance department (or equivalent state agency) that authorizes that company to conduct insurance business in that particular state.

Claims Department

This is the department that’s responsible for processing, investigating, and paying claims.

Divisible Surplus

This is the amount of earnings that are paid to policy owners as dividends after the insurance company sets aside funds required to cover reserves, operating expenses, and general business purposes.

Domestic Insurer

This is an insurer with its principal or home office in the state in which it’s authorized.