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General
Earned Income.
The money individuals earn as a result of working at some job or occupation
for which they are paid a salary.
Earned Premium.
The amount of the premium that has been "used up" during the term
of a policy. For example, if a one-year policy has been in effect six months,
half of the total premium has been earned.
Effective Date.
The date on which the protection of an insurance policy or bond goes into
effect.
Emotional Distress.
See Mental Distress.
Endorsement.
A written or printed form attached to the policy which alters provisions
of the contract.
Equifax.
Formerly known as the Retail Credit Company. It is an organization widely
used by insurers to obtain information on applicants for underwriting purposes
and sometimes on claimants. Their reports are known as Retail Credit Reports.
Equity.
The money value of an insurance company that is over and above its liabilities.
Liabilities include almost all of its reserves.
Estate Plan.
A plan for the disposition of one's property at death, including the handling
of property in the event of the incompetency or total disability of the
estate owner. A will is part of an estate plan.
Estimated Premium.
A provisional premium which is adjusted at the end of the year. For example,
in Workers Compensation Insurance an estimated premium is based on estimated
payrolls for the coming year. At the end of the year, final payrolls are
determined and the final premium is computed.
Evidence Clause.
A clause in a policy which requires the insured to cooperate in the investigation
of a claim by producing records and submitting to examinations. This is
required to help an adjuster establish the validity of a claim. An Evidence
Clause in a Health policy requires the insured to submit to physical examinations.
Ex Gratia Payment.
Latin for "from favor." A payment by an insurer to an insured
for which there is no liability under the contract. In some cases an insurer
may feel there has been a mistake or a misunderstanding, and he may pay
a claim even though he does not appear to be liable.
Examination.
See Convention Examination.
Examiner.
An employee assigned by the state insurance department to audit insurers'
records.
Exception.
See Exclusion.
Excess Insurance.
A coverage designed to be in excess over one or more primary coverages,
and which does not pay a loss until the loss amount exceeds a certain sum.
Contrast with Primary Coverage.
Excess Line Broker.
A person licensed to place insurance not available in his state through
insurers not licensed to do business in the state. A person licensed to
deal with nonadmitted insurers.
Exclusion.
A contractual provision that denies coverage for certain perils, persons,
property, or locations.
Exclusions.
Specific situations, conditions, or circumstances that are listed in the
contract as being not covered.
Exclusive Agency System.
An insurance distribution system within which agents sell and service insurance
contracts that limit representation to one insurer and which reserve to
the insurer the ownership, use, and control of policy records and expiration
date. See also Captive Agent and Direct Writer, and contrast with Independent
Agency System.
Executor, Executrix.
A fiduciary named in a will to settle an estate. An executrix is a female
executor.
Expense Allowance.
A compensation paid to an insurance agent in excess of prescribed commissions.
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