This glossary is for non-commercial educational purposes only. The
definition of the
terminology below is only a brief description and should not be considered factual or
the only definition possible. This information is only to help better inform you
of information related to liquidations.
Termination of a policy of insurance prior to its expiration date.
Capitation
A payment arrangement on a per member basis whereby managed care plans prepay health care providers a fixed, per-capita amount (usually on a monthly basis) to care for a given number of patients over a given period of time. The rate may be fixed for all members or it can be adjusted for the age and gender of the members, based on actuarial projections of medical utilization.
Casualty Insurance
Insurance concerned with the insured's legal liability for injuries to others or damage to another person's property. Includes liability insurance and workers' compensation insurance.
Certificate of Insurance
A document issued to individuals insured under a group policy setting forth the essential terms of coverage.
Claim
1) A demand for payment under an insurance contract or bond, 2) in liquidation, the filing for amounts due another from an insolvent insurance company.
Claimant
Any person or entity making a claim against the assets of the liquidation estate.
Claims-Made Policy
An insurance policy covering only those claims that are reported during the policy period. Losses occurring before the policy term are sometimes covered by the addition of "prior acts" coverage to the policy. Losses reported after the policy term are sometimes covered by the addition of an extended reporting period or "tail" coverage.
Class of Claim
The class of a claimant's claim is determined by state law and specifies the priority by which claims will receive a distribution of assets from the insolvent insurer's estate.
Contracted Provider
See Participating Provider
Covered Claim
Two meanings here: (1) A claim of an insured or third-party liability claimant that arises out of and is within the coverage of an insurance policy issued by an insurer, (2) An unpaid claim arising under a policy of insurance issued by an insolvent insurer that is allowed by statute and is accepted and handled by an insurance guaranty association.
Creditor
Any person having a claim in an insurance liquidation proceeding.
