Glossary of Terms

 
Active Transaction Status
An endorsement transaction that has been approved will be in Active status
 
Accelerated cancellation rate
An accelerated cancellation factor based on less than 365 (for annual policies) or 183 (for six-month policies).
 
Billing system
The direct bill billing software engine
 
Billing cycle
A timetable of direct bill premium billing and payment due dates.
 
Cancel Endorsement
The endorsement is cancelled and the changes made through the endorsement are discarded.
 
Certified mail
The post office stamp verifying that the envelope was mailed to the insured/billed party/financial institution.
 
Cancellation notice
A notice generated in advance of the cancellation date (Per individual state guidelines) advising the insured that the
policy will be cancelled. Specific reason(s) for cancellation must be shown on the notice.
 
Cancellation pending
A policy status between the date of issuance of the cancellation and the actual cancellation date.
 
Company Bill, Company Issued
The company issues the policy and bills the insured or designated payee.
 
Direct Agent
Insurance licensed contracted retail entity selling the company?s products directly to the purchasing consumer.
 
Decline Endorsement
The General Agent or the Home Office user declines an endorsement and a declination notification is sent to the user
and the applicant. The endorsement that has been declined will be in ?Declined? status.
 
Direct Agent
Insurance licensed contracted retail entity selling the company?s products directly to the purchasing consumer.
 
Direct Bill
The company issues the policy and bills the insured or designated payee.
 
Direct agent
An independent agent that writes business directly through ARIC.
 
Direct bill
Billing process whereby the system sends installment and renewal billings that are generated by the company and
mailed directly to the insured (or Lienholder, where applicable).
 
Equity
The number of days of insurance purchased based on the premium paid.
 
Endorsements
Any change during a policy term, either premium or non-premium bearing.
 
Exception Renewal Processing
Policies that missed a renewal milestone because of several reasons can be renewed through exception renewal
processing.
 
Expiration Date
Policy Term End Date
 
Flat Cancel
All fees/taxes/premiums (including fully earned premiums) are returned for Flat cancels
 
Fully earned premium
Premium that is completely earned at the inception of the policy.
 
Fully earned fees
Fees that are completely earned at the inception date of the policy
 
General Agent
Insurance licensed contracted entity acting as a wholesaler of the company?s products. The General Agent uses
licensed sub-producers for retail sales.
 
General Agent
Insurance licensed contracted entity acting as a wholesaler of the company?s products. The General Agent uses
licensed sub-producers for retail sales.
 
Grand fathering
Policies, that at the original time of issuance, met program requirements, but no longer meet those requirements due to
program changes or the length of time that has lapsed since the program started. The system shall allow these grand
fathered policies to renew by the rules and edits.
 
Initiate Endorsement
The endorsement transaction is initiated. User input is requested for endorsement effective date, reason(s) and the
system allows changes to the existing policy screens.
 
Issue Endorsement
The endorsement changes are applied to the policy and the new Declaration Page and the necessary documentation
are printed.
 
In Progress
A message that has been assigned to a HO or General Agent user and the review process has begun
 
Milestone
An identifiable stage in the renewal process. The milestones for renewal include pre-renewal image creation, ordering
outsourced reports, underwriting review, non- renewal or renewal decision.
 
Minimum Earned (Retained) Premium (MEP)
If a policy is cancelled, it is the minimum premium that will be charged for the cost of doing business, when applicable.
 
NSF
Non-sufficient fund check
 
Non-renewal notice
A notice generated in advance of the cancellation date (Per individual state guidelines) advising the insured that the
policy will be cancelled. Specific reason(s) for cancellation must be shown on the notice.
 
Pro-rata
Earned premium calculation based on 365 days for annual policies or 183 days for six-month policies.
 
Out-of-sequence Endorsement
An out of sequence endorsement is a backdated endorsement that applies the changes from the previously entered
endorsements in that time frame and then reapplies the endorsements to maintain the policy in a consistent state.
 
Policy Renewal Term
A period of time for which a policy is re-issued.
 
Quick Quote
A rate quotation generated based on the minimum amount of information required to provide an accurate rate.
 
Renewal Generation
Completion of the renewal process and generating the required documents for printing.
 
Referred Transaction Status
An endorsement transaction that has been submitted for approval and is yet to be approved will be in Referred status.
 
Re-underwriting
On an existing policy, reviewing a risk or validating it against the rules in the system to make sure the policy still
qualifies for a program.
 
Specialty Agent
Insurance licensed contracted entity who acts as a retailer or wholesaler selling one specific product for the company.
The Specialty Agent may use licensed sub-producers for retail sales. Generally, the agent is appointed to write only
one product.
 
Sub Agent
An insurance licensed retailer selling the company?s products directly to the purchasing consumer. This type of retailer
does not have a contractual relationship with the company. This type of retailer?s contractual relationship is with at least
one General or Specialty Agent.
 
Submit Endorsement
An endorsement is submitted to the work queue of the next higher authority.
 
Specialty Agent
Insurance licensed contracted entity who acts as a retailer or wholesaler selling one specific product for the company.
The Specialty Agent may use licensed sub-producers for retail sales. Generally, the agent is appointed to write only
one product.
 
Sub Agent
An insurance licensed retailer selling the company?s products directly to the purchasing consumer. This type of retailer
does not have a contractual relationship with the company. This type of retailer?s contractual relationship is with at least
one General or Specialty Agent.
 
State Mandated Date (SMD)
Minimum number of days prior to policy expiration plus mailing time plus one day required by state regulations for
which a renewal/non-renewal must be sent.
 
Short rate
Earned premium calculation based on 90% of pro-rata.
 
Program
String Description of the ARIC Numeric code for the Line of Business within the product.
 
Submit for Approval
Any transaction that, based on information provided by the user in specific data fields, exceeds any pre-specified
parameters for coverage limit, coverage type, underwriting rule, etc. and requires a higher authority level to override
the edit and approve the transaction before it can be completed.
 
Section Submit
When referring to Section Submit throughout this document, we are referring to a specific area or ?section? of data
fields on a page that is filled out and ?submitted? to the system as a whole for edit checks, validations, etc. (Example ?
Eligibility Information section in Product Selection page.) Section submit is similar to page validations.
 
Stop payment
A check that the insured/general agent/sub or direct agent requests that their bank to not process.
 
Sub agent
An independent agent that writes business through an ARIC appointed general agent.
 
Submit
A message has been submitted but not yet assigned/ reviewed by HO or General Agent user
 
Transferred
A message that has been transferred to the message list of a HO or General Agent user but has not begun the
review process
 
Transaction Status - Active
If a message with a status of Submit, In Progress or Transfer the message is considered active
 
Transaction Status - All Active
If a message has a status of Submit, In Progress or Transfer the message is considered active
 
Transaction Status - Closed
If a message has been forced closed by Home Office UW the message will show closed
 
Transaction Status - All Closed
If a message has a status of Approved, Declined or Closed, the transaction can be located in the All Closed
search criteria
 
Worst Case State Mandated Date (WSMD)
The worst-case state mandated date (referred as WSMD) is the highest number of days notice required for
renewal/non-renewal of a policy state.
 
What transactions will generate a Message
When a transaction does not meet the standard underwriting or system rules for completion of a transaction, a
message will generate advising that the transaction has been SUBMITTED for review by a Home Office /
General Agent user. The user submitting the transaction as well as the user that will review the transaction at
the HO/General agent level will see this message in the Group Message List.