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Insurance Glossary - D

Damage to Property of Others
Damage covered up to $500 per occurrence for an insured who damages another's property. Payment is made despite the lack of any legal liability.

Death Benefit
A payment made to a designated beneficiary upon the death of the employee annuitant.

Declarations
Statements in an insurance contract that provide information about the property or life to be insured and used for underwriting and rating purposes and identification of the property or life to be insured.

Declination
The insurer's refusal to insure an individual after careful evaluation of the application for insurance and any other pertinent factors.

Deductible
An amount which a policyholder agrees to pay, per claim or per accident, toward the total amount of an insured loss.

Deferred Annuity
An annuity providing for the income payments to begin at some specified future date.

Deferred Compensation
Arrangements by which compensation to employees for past or current services is postponed until some future date.

Dental Insurance
Individual or group plan that helps pay costs of normal dental care as well as damage to teeth from an accident.

Dependency Period
Period of time following the readjustment period during which the surviving spouse's children are under eighteen and therefore dependent of the parent.

Dependent Benefits
Social Security benefits available to the spouse or children of a Social Security beneficiary.

Deposit Premium
The premium deposit paid by a prospective policy holder when an application is made for an insurance policy. The actual premium when billed.

Depreciation
A decrease in the value of property over a period of time due to wear and tear or obsolescence. Depreciation is used to determine the actual cash value of property at time of loss.

Diagnosis-Related Groups (DRGs)
System that reimburses health cared providers fixed amounts for all care given in connection with standard diagnostic categories.

Difference in Conditions Insurance (DIC)
"All-risks" policy that covers other perils not insured by basic property insurance contracts, supplemental to and excluding the coverage provided by underlying contracts.

Direct Loss
Financial loss that results directly from an insured peril.

Direct Premiums Written
Property and casualty insurance premiums written (less return premiums), without any allowance for premiums for assumed or ceded reinsurance.

Direct Response System
A marketing method where insurance is sold without the services of an agent. Potential customers are solicited by advertising in the mail, newspapers, magazines, television, radio, and other media.

Direct Writer
The industry term for a company which uses its own sales employees to write its policies.

Directors' and Officers' Liability (D&O)
The exposure of corporate managers to claims from shareholders, government agencies, and employees, and others alleging mismanagement.

Disability
A physical or a mental impairment that substantially limits one or more major life activities of an individual. It may be partial or total.

Disability Benefit
A feature added to some life insurance policies providing for waiver of premium, and sometimes payment of monthly income, if the policy holder becomes totally and permanently disabled.

Disability Income Insurance
A form of health insurance that provides periodic payments to replace income when an insured person is unable to work as a result of illness, injury, or disease.

Dismemberment
Loss of body members (limbs), or use thereof, or loss of sight due to injury.

Dismemberment Insurance
A form of health insurance that provides payment in case of loss by bodily injury of one or more body members (such as hands or feet) or the sight of one or both eyes.

Disposable Personal Income
The personal income less personal tax and non-tax payments. It is the income available to people for spending and saving.

Dividend
A) A return of part of the premium on participating insurance to reflect the difference between the premium charged and the combination of actual mortality, expense and investment experience.
B) Portion of the premium which is returned to the insured because of favorable experience by the company.
C) A policy holder's share in the insurer's divisible surplus fund apportioned for distribution, which may take the form of a refund of part of the premium on a participating policy. The term is also used for a stockholder's share of the portion of a corporation's earnings that is distributed in cash or additional stock.

Dividend Addition
An amount of paid-up insurance purchased with a policy dividend and added to the face amount of the policy.

Dollar Threshold
In no-fault auto insurance states with the dollar threshold, it prevents individuals from suing in tort to recover for pain and suffering unless their medical expenses exceed a certain dollar amount.

Domestic Insurer
An insurance company is a domestic company in the state in which it is incorporated.

Donor
The person making a gift

Double Indemnity
A policy provision usually associated with death, which doubles payment of a designated benefit when certain kinds of accidents occur.

Dramshop Law
Law that imputes negligence to the owner of a business that sells liquor in the case that an intoxicated customer causes injury or property damage to another person. Usually excluded from general liability policies.

Driver Education Credit
Student discount or reduction in premium amount for which young drivers become eligible on completion of a driver education course.

Duplication of Benefits
Overlapping or identical coverage of the same, insured under two or more health plans, usually the result of contracts of different insurance companies, service organizations, or pre-payment plans; also known as multiple coverage.

Disability income payable for the life of the insured as long as he is totally disabled.
Whole life insurance on which premiums are payable for a specified number of years or until death if death occurs before the end of the specified period.