R
Railroad protective
liability
- Liability coverage designed to protect a railroad from liability claims
arising out of the operations of others on or adjacent to railroad property.
Rain
insurance - A weather coverage that indemnifies a promoter or organizer
against loss of income because of the cancellation of an outdoor event
due to rainfall that exceeds a specified amount during a specified time
period.
Rate
filing - Documentation filed by an insurer with the state requesting
a change in the existing rates.
Rating
bureau - A private organization that classifies and promulgates
manual rates (or loss costs).
Real
property - Land, buildings, and other structures (such as a swimming
pool or tool shed).
Rebate
- In insurance, a portion of an agent’s commission returned to a customer
as an inducement to place the insurance through the agent. This practice
is illegal in all but two states as against public policy. Reciprocal
exchange - A type of insurance managed by an attorney-in-fact in which
members pay premiums, and share in losses equally. Membership is required
for insurance.
Redlining
- Unfair discrimination based not on the risk’s characteristics but
on its location. The term is commonly associated with an insurer’s refusal
to consider insuring any home or business within a specific area marked
by a line drawn on a map.
Reinsurance
- The business of insuring insurance companies. By "ceding"
a portion of its business to a reinsurance company, an insurer spreads
the risk of exposure to catastrophic loss.
Reinsurer,
see Reinsurance.
Removal
- "Removal" was a provision of the New York Standard Fire
Policy in which the insurer agreed to cover the cost of removing covered
property from the path of a fire. Presently, property policies express
the agreement in terms of "preservation of property" from
imminent danger of damage from any covered peril. Not to be confused
with Debris removal.
Renewal
- The extension of the term of coverage of an expired policy, commonly
by replacement with another policy effective on the date of expiration
of the previous policy.
Rent-a-captive
- A specialized form of capitve insurance company operation designed
for businesses that do not want to own a captive but want to obtain
some of the advantages offered by captives. A rent-a-captive is formed
by a group of investors and operated as an income-producing business.
Insureds who wish to participate "rent" space in the captive
instead of setting up and capitalizing their own captive insurance company.
Rent
insurance - A form of business interruption insurance for a landlord.
It protects building owners against loss of income when the building
cannot be rented because of damage from any of the insured perils. It
provides income while an insured’s building is untenantable.
Rental
value insurance - Refers to protection of either a landlord’s rental
income or an owner occupant’s economic stake in use of the subject structure.
Either interested party can obtain coverage by way of an Insurance Services
Office business income form.
Renters
insurance - Term for insurance for the non-owner occupant of a dwelling
or apartment.
Replacement
cost, see Actual cash value.
Replacement
cost appraisal - An appraisal that determines the amount required
to replace an existing structure and related personal property.
Replacement
cost insurance - Covers property — both building and contents —
on the basis of full replacement cost without deduction for depreciation
on any loss sustained, subject to the terms of the co-insurance clause.
Reporting
form - A device for insuring values subject to extensive fluctuation
that keeps the premium in line with the actual exposure. A maximum limit
is set at policy inception and the insured is charged a "deposit
premium." Actual values are then reported, usually on a monthly
basis, and earned premium is figured on the basis of those reports and
laid off against the deposit premium.
Reservation
of rights - An arrangement in which an insurer agrees to proceed
with the defense of a case without commitment to provide coverage, in
the event that the facts disclosed during the trial reveal that the
occurrence is not covered.
Reserves
or reserved losses - The value of losses that have been estimated
and set up for future payment.
Resident
agent - A licensed agent who resides in and is licensed in the state
in which business is being written.
Residual
markets - Insurance markets established outside the normal insurance
marketing channels to cover unusually large or poor risks. Such markets
include assigned risk plans, aircraft pools, nuclear pools, and certain
government insurance programs.
Respondeat
superior - A legal term referring to the fact that, under specific
circumstances, an employer (or principal) is legally liable for the
actions of his or her employees while in the course of their employment.
Retention
- Usually used in reinsurance, this is the amount of liability retained
by an insurer, and not ceded to a reinsurer.
Retroactive
date - The date that defines the extent of coverage in time under
claims-made liability policies. Claims resulting from occurrences prior
to the policy’s stated retroactive date are excluded.
Retrocessionnaire
- A reinsurer that contractually accepts a portion of the cedant’s reinsurance
risk. The transfer is called a retrocession. Retrospective rating -
A rating arrangement in which the final premium for insurance coverage
is not determined until all claims are closed. The final premium is
determined by the insured’s actual loss experience during the policy
period.
Rider
- Another term for an endorsement attached to a policy that modifies
the coverage.
Riot
- One of the extended coverage perils, related to, but broader than,
civil commotion.
Risk
- Risk is uncertainty concerning loss. Sometimes also used to refer
to a piece of business or a submission to an insurer.
Risk
and Insurance Management Society, Inc. (RIMS) - Trade association
of risk managers and insurance buyers.
Risk
management - The process of handling pure risk by way of reduction,
elimination, or transfer of risk, with the latter commonly achieved
through insurance.
Risk
manager - The individual in an organization responsible for evaluation
of the organization’s exposures, and controlling these exposures through
such means as avoidance or transference, as to an insurance company.
Risk
retention group - An insurance company chartered under the laws
of a state or other U.S. jurisdiction, composed of members whose business
activities are similar, and controlled by its members.
Rolling
store - A vehicle out of which goods are sold. An example would
be a mobile snack bar at a construction site. Insurance policies may
contain wording that may restrict or define available coverage for this
type of operation.
