Insurance Definitions

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BAILEE:  A person or concern having possession of property committed in trust from the owner.

BAILEE'S CUSTOMERS POLICY:  A policy providing for loss or or damages to property of bailee's customers, payable either to bailees for their account or direct to customers.

BASIC COVERAGE FORM:  Any of the commercial or personal insurance property forms which provide basic coverages. These forms generally provide the most limited coverage, which is surpassed by "Broad Forms" and "Special Forms."

BASIC RATE:  The manual rate, from which are taken discounts or to which are added charges to compensate for the individual circumstances of the risk.

BENEFICIARY:  Designation by the owner of a life insurance policy indicating to whom the proceeds are to be paid upon the insured's death or when an endowment matures.

BENEFIT OF INSURANCE CLAUSE:   A clause by which the bailee of goods claims the benefit of any insurance policy effected by the cargo owner on the goods in care of the bailee. Such a clause in a contract of carriage, issued in accordance with the Carriage of Goods by Sea Act, is void at law.

BILL OF LADING:   Contract of carriage and receipt for goods, issued by carrier.

BINDER:  (Or Binding Receipt):  In lines other than life and health, a binder is an acknowledgement (usually from the agent) that insurance applied for is in force whether or not premium settlement has yet been made or the policy issued. In life and health insurance, binders are not issued, but if premium settlement is made with the application, what is often erroneously referred to as a "binder" is issued. Actually this is a conditional binding receipt.

BLANKET INSURANCE:  (1) Property-liability insurance that covers more than one type of property in one location in one policy or form instead of under separate items, or one or more types of property at more than one location; (2) A contract of health insurance that covers all of a class of persons not individually identified.

BODILY INJURY LIABILITY:  The liability which may arise from injury or death of another person.

BOILER AND MACHINERY POLICY:  Insurance against loss due to accidents to boilers, pressure vessels or other machinery including the equipment itself, as well as liability arising out of the accident.

BOND:  An obligation of the insurance company to protect one against financial loss caused by acts of another.

BUILDER'S RISK COVERAGE FORM:  A commercial property coverage form specifically designed for buildings in the course of construction.

BUILDER'S RISK INSURANCE:  Insurance against loss to buildings or structures in the course of construction.

BUILDINGS AND PERSONAL PROPERTY COVERAGE FORM:  A commercial property coverage form designed to insure most types of commercial property (buildings or contents or both). It is the most frequently used commercial property form, and has replaced the General Property Form, Special Building Form, Special Personal Property Form, and others.

BUSINESS AUTO COVERAGE FORM:  The latest commercial Automobile Insurance coverage form, which may be written as a monoline policy or as part of a commercial package. This form has largely replaced the Business Auto Policy.

BUSINESS INCOME COVERAGE FORM:  A commercial property form providing coverage for "indirect losses" resulting from property damage, such as loss of business income and extra expenses incurred. It has replaced earlier Business Interruption and Extra Expense forms.

BUSINESS INTERRUPTION INSURANCE:  A type of policy that pays for loss of earnings when operations are curtailed or suspended because of property loss.

BUSINESS LIABILITY:  The term used to describe the liability coverages provided by the Businessowners Liability Coverage Form. It includes liability for bodily injury, property damage, personal injury, advertising injury, and fire damage.

BUSINESS PERSONAL PROPERTY:  Traditionally known as "contents," this term actually refers to furniture, fixtures, equipment, machinery, merchandise, materials, and all other personal property owned by the insured and used in the insured's business.