Coto Laurel Puerto Rico Auto Insurance

Insurance Information
Hazard
Condition that creates or increases the chance of loss.

Health Maintenance Organization
An organization that provides a wide range of comprehensive health care services for a specified group at a fixed periodic payment. The HMO can be sponsored by the government, medical schools, hospitals, employers, labor unions, consumer groups, insurance companies, and hospital-medical plans.

High-Risk Automobile Insurer
Company that specializes in insuring motorists who have poor driving records, have been canceled, or have been refused insurance (ex: high risk vehicle, commercial use).

Hold-Harmless Clause
Clause written into a contract by which one party agrees to release another party from all legal liability, such as a retailer who agrees to release the manufacturer from legal liability if the product injures someone.

Homeowners Policy
A package of insurance providing homeowners with a broad range of property and liability coverages.

Hospice
Health care facility providing medical care and support services such as counseling to terminally ill persons.

Hurricane
A tropical storm marked by extremely low barometric pressure and circular winds with a velocity of 75 miles an hour or more.

Insurance Information (cont'd)
Rate
The pricing factor upon which the insurance buyer's premium is based.

Rated Policy
Sometimes called an "extra-risk" policy, an insurance policy issued at a higher-than-standard premium rate to cover the extra risk where, for example, an insured has impaired health or a hazardous occupation.

Ratemaking
The statistical process by which insurers determine risks and pricing for the basic classes of insurance.

Rating Territory
A geographical grouping in which like hazards tend to equalize and permit the establishment of an equitable rate for the territory.

Reasonable and Customary Charge
A charge for health care, which is consistent with the going rate or charge in a certain geographical area for identical or similar services.

Rebating
Giving any valuable consideration, usually all or part of the commission, to the prospect or insured as an inducement to buy or renew. Rebating is prohibited by law.

Recurring Claim Provision
A provision in some health insurance policies which specifies a length of time during which the recurrence of a condition is considered to be a continuation of a previous period of disability or hospital confinement.

Recurring Clause
A provision in some health insurance policies, which specifies a period of time during which the recurrence of a condition is considered a continuation of a prior period of disability or hospital confinement.

Reduced Paid-up Insurance
A form of insurance available as a nonforfeiture option. It provides for continuation of the original insurance plan, but for a reduced amount.

Regulation
Supervision of business practices by a governmental entity.

Rehabilitation
(1) Restoration of a totally disabled person to a meaningful occupation, (2) a provision in some long- term disability policies that provides for continuation of benefits or other financial assistance while a totally disabled insured is retraining or attempting to resume productive employment.

Reimbursement
The payment of the expenses actually incurred as a result of an accident or sickness, but not to exceed any amount specified in the policy.

Reinstatement
The resumption of coverage under a policy which has lapsed.

Reinsurance
Assumption by one insurance company of all or part of a risk undertaken by another insurance company.

Reinsurance Facility
An alternative mechanism to service those insureds that cannot obtain insurance in the voluntary market. Premiums and losses for the business that is ceded to the facility are pooled and all insurers share according to their proportion of the voluntary market.

Renewable Term Insurance
Term insurance which can be renewed at the end of the term, at the option of the policyholder and without evidence of insurability, for a limited number of successive terms. The rates increase at each renewal as the age of the insured increases.

Renewal
Continuance of coverage under a policy beyond its original term by the insurer's acceptance of the premium for a new policy term.

Renter's Policy
A package type of insurance that includes coverage similar to a homeowners policy to cover the personal property of a renter or tenant in a building.

Replacement
The substitution of health insurance coverage from one policy contract to another.

Replacement Cost
The cost to repair or replace property at construction costs prevailing at time of loss; the cost to repair or rebuild property without considering depreciation. (See Actual Cash Value)

Replacement ratio
The percentage of income before retirement that is required to be replaced to maintain the same standard of living after retirement.

Representation
Statements made by an applicant in the application, which he represents as being substantially true to the best of his knowledge and belief, but which are not warranted as exact in every detail.

Rescission
Termination of an insurance contract by the insurer on the grounds of material misstatement on the application for insurance. The action of rescission must take place within the contestable period or Time Limit on Certain Defenses but takes effect as of the date of issue of the policy, thus voiding the contract from its inception.

Reservation of Rights
An arrangement whereby an insurer defends a case without commitment to provide coverage in the event that the facts disclosed during the trial reveal that the occurrence is not covered.

Reserve
(1) An amount representing liabilities kept by an insurer to provide for future commitments under policies outstanding. (2) An amount allocated for a special purpose. Note that a reserve is usually a liability and not an extra fund.

Residual Disability
A period of partial disability that immediately follows a period of total disability. Benefits for residual disability are paid on a pro-rata basis, depending on the percentage of earnings loss.

Residual Disability Benefits
A provision in an insurance policy that provides benefits in proportion to a reduction of earnings as a result of disability, as opposed to the inability to work full-time.

Residual Market
A system through which insurance is made available to buyers that represent unusually high risks.

Retention
The net amount of risk retained by an insurance company for its own account or that of specified others, and not reinsured.

Retrocession
The process by which a reinsurer obtains reinsurance from another company.

Retrospective Date
The first date for which claims will be paid under a claims-made policy of liability insurance.

Retrospective Rating
Rating procedure which allows adjustment of an insured's final rate on the basis of the insured's own loss experience.

Revocable Trust
A trust that can be terminated or revoked by its creator.

Rider
A special policy provision or group of provisions that may be added to a policy to expand or limit the benefits otherwise payable.

Right of Survivorship
At the death of one co-owner of property, that person's interest in the property automatically passes to the surviving joint tenant or tenants.

Risk
The chance of loss. Also used to refer to the insured or to property covered by a policy. A term used to refer to a person or the peril insured.

Risk Classification
The process by which a company decides how its premium rates for life insurance should differ according to the risk characteristics of individuals insured (e.g., age, occupation, sex, state of health) and then applies the resulting rules to individual applications. (See - Underwriting)

Risk Control
Any conscious action (or decision not to act) intended to reduce the frequency, severity, or unpredictability of accidental losses.

Risk Retention Group
An alternative form of insurance in which members of a similar profession or business band together to self insure their risks.

Robbery
The taking of property from a person by force or threat of violence.

Rollover
Transfer of IRA or other qualified pension funds from one financial institution (trustee) to another.