Standardized insurance industry forms (applications, certificates, etc.) maintained by ACORD, used across carriers and agents to capture and exchange risk in.
AI claims processing applies machine learning and automation to intake, triage, assess, and settle insurance claims faster and more consistently.
A structured review of an AI or statistical model's design, training data, outputs, and deployment to verify accuracy, fairness, and regulatory compliance.
The policies, procedures, and controls an insurer implements to ensure AI and ML models are accurate, fair, explainable, and regulatory-compliant.
AI underwriting uses machine learning to score risk, extract submission data, and recommend pricing and accept/decline decisions to underwriters.
An AMS manages policies, carriers, and servicing; a CRM manages prospects, pipeline, and relationships. Many agencies need both, integrated.
The ecosystem of carrier, MGA, and vendor APIs enabling real-time exchange of quotes, policy data, and claims status across insurtech workflows.
A licensed professional who manages the overall client relationship on a commercial account, coordinates coverage, and leads the annual renewal process.
Identifying and filling coverage gaps in an existing client's insurance program by adding lines the client currently places elsewhere or lacks entirely.
Recording all agency interactions with clients and prospects — calls, emails, meetings, and tasks — within a CRM or AMS to maintain a complete contact history.
The actuarially derived rate change percentage needed for a book to achieve target profitability, before regulatory and competitive adjustments.
A professional, trade, or membership organization offering insurance to members via an exclusive or preferred carrier relationship leveraging group size.
A consolidated display within an AMS or CRM showing agency KPIs — premium volume, pipeline status, renewal counts, and task backlogs — at a glance.
The core software system an insurance agency runs on — managing policies, clients, documents, commissions, and workflows.
The structured process of integrating a new client into an agency's service model, including data entry, welcome communications, and coverage review.
A defined sequence of steps, assignments, and checkpoints that standardizes how an agency processes recurring policy transactions or service events.
Agentic AI refers to AI systems that autonomously plan and execute multi-step tasks toward a goal
Applying agentic AI to underwriting — autonomous systems that triage submissions, gather and enrich data, assess risk, and draft recommendations across multi.
A coverage option where insurer and insured agree at inception on the property's insured value, suspending the coinsurance clause for the policy period.
Systematic unfair discrimination in AI or ML models disadvantaging protected classes—a critical compliance concern as insurers adopt predictive models.
A non-US insurance company eligible to write surplus lines business in US states, typically through Lloyd's or similar international markets.
Expenses directly attributable to a specific claim, such as attorney fees, independent adjuster fees, and expert witness costs.
The formal authorization from a carrier allowing an agent or agency to sell its products.
A chronological, tamper-evident record of actions and decisions in a system.
Distribution of insurance products through bank branches and relationships, leveraging the bank's customer base to sell life, annuity, or P&C products.
An agent's or MGA's authorization to issue binders — temporary evidence of coverage effective immediately — on a carrier's behalf before the policy is issued.
Delegated authority letting an agent, broker, or MGA commit a carrier to coverage without case-by-case approval, within agreed limits.
Blanket coverage applies one shared limit across all insured locations; specific coverage assigns a separate limit to each location or item.
The total portfolio of insurance policies managed by an agent, broker, or agency, representing the collective revenue base of the practice.
A comparative rater redirect that sends an agent to a carrier's own portal to complete a quote instead of returning a bindable result in-platform.
A reserving method applying statistical factors to groups of claims rather than setting individual case reserves, used for high-volume low-severity lines.
A premium rate derived directly from advisory loss costs published by a rating bureau such as ISO or NCCI, without independent carrier modification.
A licensed insurance agent who works exclusively for one carrier, representing only that company's products under an employee or exclusive agent agreement.
An insurance company wholly owned by the entity or group it insures, created to fund the owner's own risks rather than transfer them to a commercial carrier.
The set of risks a carrier wants to write — by line, industry, size, geography, and risk characteristics.
The technical integration between an agency's AMS and carrier systems enabling policy downloads, real-time quoting, and data synchronization.
The process of establishing a specific dollar reserve for an individual open claim, representing the estimated total cost to resolve that claim.
Using data and simulation to estimate potential losses from catastrophic events — hurricanes, wildfires, earthquakes — to inform pricing, risk selection, and.
The organized deployment of adjusters, vendors, and triage protocols to manage a surge of claims following a natural disaster or large-scale loss event.
Claims automation uses software to handle repetitive claims tasks — intake, routing, data entry, and simple settlements — with little or no manual effort.
Measurable overpayment on claims relative to the theoretically correct settlement, resulting from process failures, errors, or inadequate investigation.
A model predicting the ultimate cost of an individual claim, used to set reserves, prioritize handling, and flag high-exposure files.
The automated sorting of incoming claims by complexity, severity, or risk — routing simple claims to fast-track or straight-through processing and complex on.
A secure self-service web interface where policyholders can access policy documents, submit service requests, make payments, and contact their agency.
Dividing an agency's book into groups by revenue, line, or risk profile to tailor service levels, staffing, and marketing.
A policy condition requiring coverage equal to a set percentage of replacement cost; under-insuring triggers a proportional penalty on partial loss recoveries.
A carrier profitability metric: incurred losses plus expenses divided by earned premium. Below 100% means underwriting profit; above means a loss.
The process of recording, reconciling, and reporting insurance commissions owed and received, including carrier statement matching and discrepancy resolution.
A comparative rater is software that lets agents enter client data once and receive quotes from multiple carriers simultaneously, enabling side-by-side price
AI-based image and video analysis that assesses property or vehicle damage, classifies loss severity, and estimates repair costs from photos.
The systematic organization and maintenance of policyholder and prospect contact records within a CRM or AMS, including notes, history, and preferences.
In customer service AI, the percentage of inquiries fully resolved by the automated system without escalation to a human agent. A primary effectiveness metric.
Additional compensation paid by a carrier to an agency for meeting volume, loss ratio, or growth targets over a defined performance period.
Mandatory educational requirements for licensed insurance producers to complete approved credit hours each renewal period to maintain their license.
AI systems that interact through natural language — chat or voice — to answer questions, handle service requests, or guide users, increasingly used for insur.
The actuarial framework setting how much weight an insured's own loss experience gets versus industry data when calculating experience-rated premiums.
The practice of offering existing policyholders additional lines of coverage beyond what they currently hold, increasing policy count and revenue per client.
The projected total commission revenue a client relationship will generate over its full expected duration with the agency.
The total elapsed time to complete a process — most often a claim from first notice to closure.
Legal requirements obligating organizations—including insurers and agencies—to notify individuals and regulators when personal data is compromised.
Augmenting a record with additional data from external sources — to pre-fill submissions, validate information, or improve risk assessment — reducing manual.
Documentation of data's origin, transformations, and movement through systems, letting insurers trace model inputs to source for audit and review.
The contractual underwriting, binding, and claims authority a carrier grants to an MGA or coverholder to write risks without prior carrier approval.
Contractual authority a carrier grants an MGA or coverholder to evaluate, price, and bind risks on the carrier's paper within written guidelines.
Insurance sold directly to consumers via advertising, internet, mail, or phone—without agent intermediaries—enabling carriers to retain the full premium.
Intelligent Document Processing (IDP) is AI that reads unstructured insurance documents
The process of matching carrier-transmitted policy and commission data against an agency's internal AMS records to identify discrepancies and ensure accuracy.
An automated sequence of timed emails or texts sent to prospects or clients to nurture leads, prompt renewals, or cross-sell additional coverage lines.
Insurance offered at the point of sale of another product or service — like coverage offered when buying a car or booking travel — integrated into a non-insu.
A formal amendment to an insurance policy that changes its terms — adding, removing, or modifying coverage — during the policy period. Also called a rider.
Professional liability insurance for agents and brokers covering claims alleging failure to obtain proper coverage, improper advice, or administrative errors.
E&S lines cover risks that the standard ('admitted') insurance market won't write
The component added to loss cost covering acquisition costs, general expenses, taxes, and profit margin to arrive at the final charged premium.
A multiplier comparing an employer's actual workers' compensation losses to expected losses for its industry and size, applied to manual premium at rating.
A factor calculated from an insured's own loss history that adjusts workers compensation premium up or down from the manual rate — commonly called the e-mod.
A pricing method that adjusts manual premium up or down based on an insured's own historical loss experience relative to expected losses for their class.
A report listing policies expiring within a defined future window, sorted to prioritize the renewal outreach and remarketing workload for service staff.
Explainable AI refers to AI systems whose decisions can be understood, articulated, and audited by humans
A loss estimation method using exposure data and loss development factors when an insured lacks sufficient credible historical loss experience.
Reinsurance placed on an individual risk or policy, negotiated separately for each submission; the reinsurer may accept or decline each risk offered.
Federal law governing collection, accuracy, and use of consumer credit information—applicable to insurers using credit-based insurance scores in underwriting.
Selecting, transforming, and constructing input variables from raw data to improve predictive accuracy of machine learning models in insurance.
A regulatory framework allowing insurers to use new rates or forms immediately upon filing, without waiting for approval—subject to later department review.
A premium rate submitted to and approved by (or acknowledged by) the state insurance department, constituting the legally required rate for that risk class.
FNOL is the initial report a policyholder makes to an insurer when a loss or accident occurs
The submission of insurance policy forms—applications, policies, endorsements, certificates—to the state insurance department for approval before use.
The use of AI and data analytics to identify suspicious or fraudulent insurance claims and applications, flagging anomalies for investigation before payout.
An admitted insurer that issues policies on behalf of a captive or program lacking admitted status, providing regulatory paper while retaining minimal risk.
The exposure unit — payroll, gross sales, area, units, or admissions — against which the GL rate is applied to produce premium.
AI that produces new content — text, summaries, responses — from learned patterns.
An ensemble machine learning technique building sequential decision trees widely used in insurance pricing, fraud detection, and churn prediction.
Federal law requiring financial institutions, including insurers, to protect consumer financial information privacy and disclose their data-sharing practices.
HITRUST is a security certification framework focused on healthcare data protection. For insurance AI tools handling health information
Techniques and safeguards that reduce how often large language models produce plausible-sounding but factually incorrect outputs in insurance use.
The systematic evaluation of physical, moral, and morale conditions that increase the probability or severity of a loss for a specific risk.
A client account managed directly by agency ownership or principals rather than assigned to a producer, protecting strategic client relationships.
Incurred But Not Reported reserve: a liability estimate for losses that have occurred but have not yet been reported to the insurer.
The process of confirming a customer's identity, often automated in insurance for FNOL, service authentication, and fraud prevention in customer interactions.
The ratio of claim indemnity payments to earned premium, measuring how much of each premium dollar is paid out as loss settlements.
A claims professional working as an independent contractor hired by insurers on a fee or per-claim basis to investigate, evaluate, and settle claims.
A licensed producer representing multiple carriers who places business based on client need and market fit, owning their book of business on commission.
The rate level an actuarial analysis shows is needed to cover expected losses, expenses, and target profit, before management selects the rate actually filed.
A centralized repository storing large volumes of raw structured and unstructured insurance data in native format for analytics, modeling, and reporting.
State laws defining and criminalizing fraudulent acts in insurance—including application fraud, staged accidents, and agent premium misappropriation.
A credit-based score derived from consumer credit bureau data used in personal lines underwriting and rating to predict likelihood of filing a claim.
AI that automatically ingests, reads, and structures incoming submissions or documents at the point of entry — turning unstructured inputs into decision-read.
Sensor data from smart home, commercial property, or industrial devices used to monitor risk and enable loss prevention or dynamic pricing.
A methodology for ranking insurance prospects by conversion likelihood using demographic, behavioral, and coverage-fit attributes to prioritize outreach.
The difference between what a claim should have cost and what was actually paid — money lost to overpayment, errors, or inefficiency.
The carrier's structured process for controlling legal defense costs, outcomes, and strategies on claims that have entered the court system.
A specialist insurance and reinsurance market in London where syndicates write risk on behalf of capital providers—the world's leading specialty marketplace.
The expected claim cost per unit of exposure, excluding carrier expense and profit loadings — the foundation of property-casualty premium calculation.
The annualized percentage change in loss costs over time, reflecting inflation, medical trends, and claim frequency shifts, used in ratemaking.
The portion of premium paid out in claims: incurred losses divided by earned premium. A core measure of how a book of business is performing.
A loss run is a report from an insurer detailing a policyholder's claims history over a period
An MGA is a specialized intermediary with delegated underwriting authority from carriers — it can underwrite, bind, and sometimes handle claims for specific.
Practices adapting machine learning operations to insurance: model versioning, deployment pipelines, monitoring, retraining, and regulatory documentation.
An entity with comprehensive delegated underwriting authority from carriers, including binding, policy issuance, premium collection, and often claims handling.
A formal state insurance department examination reviewing an insurer's business practices—claims handling, underwriting, and producer oversight—for compliance.
A coordinated approach to managing injured claimants' medical care to promote appropriate treatment, recovery, and return to work while controlling claim costs.
The floor premium an insurer retains on cancellation regardless of the pro-rata calculation — typically set at 25-30% of the annual premium.
Degradation of a deployed model's predictive accuracy over time as input feature distributions or outcome relationships shift from the training environment.
Policies, controls, and oversight processes managing the full lifecycle of predictive and AI models from development through retirement.
A framework for identifying, measuring, and mitigating risks from quantitative models—including pricing models, fraud scores, and AI systems.
The increased probability of loss that arises when an insured has an incentive to allow or cause a loss because they are protected by insurance.
The increase in loss probability resulting from an insured's carelessness or indifference to loss prevention because they are covered by insurance.
Submitting one risk to multiple carriers at once and receiving comparative premiums — the core function of independent agency comparative raters.
The National Insurance Producer Registry — the system managing insurance license data across U.S.
Applying natural language processing to extract structured risk data from unstructured insurance submissions, emails, and supplemental documents.
An insurer not licensed in a given state but eligible on a surplus lines basis through licensed brokers, with fewer consumer protections than admitted carriers.
OCR converts document images into machine-readable text; IDP (Intelligent Document Processing) adds AI understanding on top to extract structured, contextual
Insurance placement negotiated individually with underwriters on a risk-by-risk basis, distinct from program or binding facility—typical for complex risks.
Personal lines insure individuals (auto, home); commercial lines insure businesses.
The practice of tracking prospective insurance accounts through defined stages from initial contact to bound policy to forecast new business revenue.
The core carrier software managing the policy lifecycle — issuance, endorsements, renewals, billing. The carrier-side counterpart to an agency's AMS.
Re-shopping an existing client's coverage to alternative carriers at renewal to secure improved pricing, terms, or coverage breadth.
Active management of an underwriting book to shift its composition toward more profitable risk segments and away from underperforming ones.
Predictive underwriting uses machine learning on historical and external data to forecast a risk's likely loss outcome, helping underwriters price and select
Third-party financing where the carrier receives full premium at inception and the insured repays a finance company in monthly installments plus interest.
Lost premium from mis-rating, under-disclosed exposure, system errors, or algorithm defects causing charged premiums to fall below actuarially indicated levels.
The degree to which charged premium is sufficient to cover expected losses, expenses, and a reasonable profit margin over the policy period.
A state regulatory framework requiring insurers to obtain explicit department approval before implementing new rates or forms—the most restrictive approach.
Cancellation returning premium in exact proportion to the remaining policy period, with no penalty — standard when the carrier initiates cancellation.
The estimated maximum loss likely to occur from a single event given the normal functioning of protective features such as sprinklers and fire departments.
A carrier-assigned unique identifier tied to a licensed producer or agency location, used to attribute new business, renewals, and commission payments.
The state-by-state system requiring insurance agents and brokers to obtain and maintain licenses to solicit or sell insurance for each line of authority.
The administrative and performance oversight functions applied to licensed producers, including goal-setting, compensation plans, and production reporting.
Insurance written under delegated underwriting authority for a defined, homogeneous niche managed by an MGA or program administrator with specialized expertise.
InsurAItools' transparency standard: provisional scores reflect initial assessment from public information; verified scores reflect hands-on testing or vendo.
A licensed claims professional retained by and exclusively representing the policyholder's interests in negotiating a property or casualty claim settlement.
An LRRA entity allowing members with similar liability exposures to purchase insurance collectively, leveraging group size for favorable carrier terms.
A proportional reinsurance treaty where cedent and reinsurer share premium and losses at a fixed percentage, transferring a set portion of every policy.
The percentage of issued quotes that result in a bound policy — a key conversion metric for agents, carriers, and digital distribution platforms.
Software 'bots' that automate repetitive, rules-based digital tasks — data entry, form filling, system updates — across insurance back-office operations.
The degree to which current charged rates are sufficient to cover expected losses, expenses, and profit margin over the policy period.
The formal submission of insurance premium rates, rating factors, and actuarial documentation to the state insurance department before charging those rates.
A preliminary estimate of insurance cost produced before full underwriting data is collected, used to qualify prospects and set pricing expectations.
The actuarial process of determining insurance prices (rates) based on expected losses, expenses, and profit.
An organization such as ISO, NCCI, or AAIS that collects industry loss data and develops advisory loss costs and policy forms used by member insurers.
A variable statistically correlated with losses used to differentiate premium by risk class — age, territory, credit score, construction type, among others.
API-based rating that returns bindable quotes from carrier systems within seconds without redirecting the agent to a separate carrier portal.
Running a predictive model instantly at a transaction point (quote, bind, FNOL), returning a risk score or decision within milliseconds.
Regulatory and legal requirements specifying how long insurers and agents must retain insurance records—policies, claims files, and communications.
A broker or manager arranging reinsurance placements between cedents and reinsurers, earning commission on placed premium for treaty and facultative deals.
The structured process of managing expiring policies through outreach, remarketing, and negotiation to maximize retention and protect premium volume.
Recalculating a policy's premium at renewal using updated exposure, loss experience, and current rate levels instead of rolling over the expiring price.
Money an insurer sets aside to pay the estimated future cost of a claim.
The percentage of policies up for renewal in a given period that successfully renew, measuring an agency's ability to retain existing premium volume.
An AI architecture grounding an LLM's responses by retrieving relevant documents or policy text from a knowledge base before generating an answer.
A formal document articulating the types, volumes, and characteristics of risk a carrier or MGA is willing to write, used to guide underwriting decisions.
A group-owned captive under the federal Liability Risk Retention Act allowing members with similar liability risks to self-insure across all US states.
The use of data and models to assign a numeric score representing a risk's likelihood or severity of loss, used to automate triage, pricing, and underwriting.
The process of routing a suspicious claim to the Special Investigations Unit for investigation of potential fraud before settlement.
SOC 2 is a widely-recognized security and data-handling audit standard
The process by which an insurer recovers value from damaged property it paid for in a total loss, typically by selling the salvaged asset.
Manual credits or debits applied by an underwriter to a base premium to reflect risk characteristics not captured by the standard rating algorithm.
A staffing structure in which dedicated account managers handle policy servicing so producers can concentrate on new business development.
Insured-initiated cancellation where the return premium is calculated at a penalized rate, retaining more than the earned pro-rata share.
A commission arrangement in which revenue from a single policy is divided between two or more producers, brokers, or agencies based on agreed terms.
Application of different rates to separate portions of a single exposure — for example, different payroll classes within a workers compensation policy.
An insurance carrier or TPA employee who handles claims internally as part of the company's permanent claims department.
The state regulatory body with primary authority over insurance regulation—licensing insurers, reviewing rates and forms, and enforcing insurance laws.
STP is the automated handling of a transaction
The package an agent or broker sends carriers to request a quote on a commercial risk — applications, loss runs, and supporting documents.
The insurer's right to recover claim payments from a third party responsible for the loss.
The regulatory requirement that insurance products recommended to clients are appropriate for their financial situation, coverage needs, and risk tolerance.
Regulatory requirements governing non-admitted insurance placement—diligent search documentation, stamping office filings, disclosure, and tax remittance.
A state-imposed tax on premiums written through non-admitted carriers, collected by the surplus lines broker and remitted to the state—typically 2%–6%.
Artificially generated data that replicates real insurance data distributions, used to train models when real data is scarce or privacy-restricted.
Adherence to the Telephone Consumer Protection Act, which restricts automated calls and texts.
A company that handles claims processing and administration on behalf of insurers or self-insured employers, without bearing the insurance risk itself.
Rules-based triggers in an AMS or CRM that automatically create, assign, and route service tasks based on policy events, dates, or incoming requests.
Driving behavior data from in-vehicle devices or apps (speed, braking, mileage) used to price auto insurance based on actual usage and risk.
Usage-based auto insurance rating that uses telematics data from mobile devices or OBD-II dongles to score driving behavior and adjust premiums.
Geographic premium differentials reflecting local variations in loss frequency and severity — typically coded by state, county, zip code, or fire district.
The full cost of adopting a tool beyond its sticker price — including implementation, training, integration, and ongoing maintenance.
A technique applying a model pre-trained on general data to an insurance task with limited labeled data, cutting training time and data needs.
A reinsurance arrangement covering an entire portfolio of risks automatically under agreed terms, without submission of individual risks for acceptance.
The pricing methodology for umbrella and excess liability policies, which cover losses above primary limits and must coordinate with underlying coverages.
Overhead claims handling costs not attributable to a specific claim, such as staff adjuster salaries, office overhead, and claims system costs.
The maximum limit of coverage, premium volume, or risk characteristics that an underwriter or agent is authorized to bind without senior approval.
The profit generated from insurance operations alone, calculated as earned premium minus incurred losses and expenses, before investment income.
A regulatory framework allowing insurers to implement new rates or forms before filing them, with retroactive filing required within a specified period.
Numerical representations of text or data in high-dimensional space, enabling semantic similarity search across insurance documents and claims.
A code used in personal and commercial auto rating to categorize a vehicle's physical damage risk based on make, model, year, and value.
Underwriting is how an insurer evaluates a risk, decides whether to cover it, and sets the price and terms of the policy.
An intermediary between retail agents and carriers, specializing in hard-to-place or specialty risks — particularly E&S — that retail agents can't place dire.
The channel where surplus lines brokers act as intermediaries between retail agents and specialty or non-admitted markets retail agents cannot directly access.
Insurance covering employee injuries and illnesses arising from work.
