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Capacity
Every insurer has a limit on the amount on new business it can write. The FSA looks at a company to ensure it has adequate reserves.
Certificate
This is the document issued by insurers as evidence that insurance is in force.
Claim
When a policyholder seeks payment or settlement for a loss they have suffered under the terms of a policy.
Co-Insurance
This is an arrangement whereby a number of insurance companies share in the cover of one particular risk.
Commercial Business
An insurance policy taken out by a company, partnership or organisation to cover their business. Would include fleet policies for motor business. Often these policies are heavily weighted towards liability.
Commission
Monies paid by an insurance company to a broker/ independent intermediary/agent for selling policies. In most companies a consumer has the right to find out what commission an agent is earning on an insurance deal.
Comprehensive Insurance
A policy which covers a number of types of loss or damage mainly in motor insurance. This is the highest level of cover.
Condition
This is part of an insurance policy stating that certain rules must be followed, for example, the duty to take reasonable care to protect property.
Consequential Loss
This is insurance covering the loss of profits of a business resulting from an insured event (also known as Business Interruption).
Contents Policy
This is an insurance policy covering the contents of a home or building against a number of different risks.
Contribution
The principle of contribution applies where a risk is insured twice or more, for example on a travel and household policy, and the two insurers concerned may share the cost of any claim. This means that an individual cannot claim twice on two policies for the same loss which would contravene a key principle of insurance which is that the insured cannot be better off following a loss and claim.
Cover Note
This is an insurance document giving temporary evidence of cover while the policy and certificate are being prepared. Normally, cover notes are issued at the start of a policy while the insurance company are awaiting proof of no claims or other documents before the policy can be issued. Cover notes can be used as proof of cover when getting road tax.
Critical Illness Insurance
These policies pays out a lump sum on the diagnosis of certain life-threatening illnesses specified in the policy.
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