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Insurance Glossary - E

Exclusions
Specific conditions or circumstances listed in the policy for which the policy will not provide benefit payments.

Exclusive Agent
An agent who is employed by one and only one insurance company and who solicits business exclusively for that company.

Exclusion or Exception
Specified conditions or circumstances, listed in the policy, for which the policy will not provide benefits.

Expense Ratio
The ratio of a company's operating expenses to premiums.

Experience
A term used to describe the relationship, usually expressed as a percent or ratio, of premium to claims for a plan, coverage, or benefits for a stated time period.

Experience Modification Factor
Used in workers compensation rating to reflect the degree to which a particular employer has experience that is better or worse that expected for that industry.

Experience Rating
The process of determining the premium rate for a group risk, wholly or partially on the basis of that group's experience.

Experience Refund
A provision in most group policies for the return of premium to the policyholder because of lower than anticipated claims.

Exposure Unit
Unit of measurement used in insurance pricing.

Extended Coverage Insurance
EC Protection for the insured against property damage caused by windstorm, hail, smoke, explosion, riot, attending a strike, civil commotion, vehicle and aircraft. This is provided in conjunction with the fire insurance policy and the various "package" policies.

Extended Reporting Period
An additional period of time after policy expiration during which valid claims will be paid under a claims-made policy of liability insurance

Extended Reporting Period Endorsement
Added to a claims-made policy of liability insurance to provide additional period of time during which valid claims will be paid

Extended Term Insurance
A form of insurance available as a nonforfeiture option. It provides the original amount of insurance for a limited period of time.

Extortion
Surrender of property away from the premises as a result of a threat to do bodily harm to the named insured, relative, or invitee who is being held captive.

Extra Expense Insurance
Type of business income insurance that covers the extra expenses incurred to continue operations after a loss has occurred.

Early Retirement
Retirement of a participant prior to the normal retirement date, usually with a reduced amount of annuity. Early retirement is generally allowed at any time during a period of 5 to 10 years preceding the normal retirement date.

Earned Income
Employment income derived from salary, wages, commissions, or fees.

Economic Loss
The estimated total cost, both insured and uninsured, of mishaps (such as motor vehicle accidents and work accidents

Elimination Period
A specified number of days at the beginning of each period of disability during which no disability income benefits are paid. The elimination period may be as short as a few days or as long as one year or more.

Embezzlement
Fraudulent use or taking of another's property or money which has been entrusted to one's care.

Employee Retirement Income Security Act (ERISA)
Legislation passed in 1974 applying to most private pension and welfare plans that requires certain minimum standards to protect participating employees.

Evidence of Insurability
Any statement of proof of a person's physical condition and/or other factual information affecting his or her acceptance for insurance.

Excess and Surplus Insurance
(1) Insurance to cover losses above a certain amount, with losses below that amount usually covered by a regular policy. (2) Insurance to cover an unusual or one-time risk.