Short-Rate Cancellation

When a policy is terminated prior to the expiration date at the policyholder’s request, the earned premium charged will be more than the pro-rata earned premium. Generally, the returned premium is approximately ninety percent of the pro-rata return premium. However, an insurance company may establish its own short-rate schedule.

Sublimit

An amount less than the full building value that is applied to specified areas of coverage. An example would be when a building is insured for $10,000,000 and there is a $25,000 limit for mold damage. The limitation for mold damage would be a sublimit.

Rider

An attachment or endorsement to an insurance policy that modifies clauses and/or provisions of the policy. Riders may include or exclude coverage.

TRIA

Federal terrorism insurance coverage that was created after 9/11, to cover federally certified acts of terrorism.