Glossary of Insurance Terms

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Named insured - The party or parties specifically named as insured in the insurance contract. Others may have claim on the coverage of a policy by way of internal provisions, but any such right is by way of the agreement between the named insured and the insurance company.

Named non-owner policy - Issued to someone who does not own an automobile, but who drives borrowed or rented autos.

Named perils - A formal and specific listing of perils covered in a policy providing property insurance. A policy covering for damage by fire is said to cover for "the named peril" of fire.

National Association of Insurance Commissioners (NAIC) - An association of insurance commissioners and superintendents formed to share information and develop common laws and procedures for insurance regulatory purposes.

National Association of Insurance Women (NAIW) - An association of women (and men) in the insurance industry who have achieved the designation of Certified Professional Insurance Woman (CPIW) or CPIM.

National Association of Professional Surplus Lines Offices (NAPSLO) - Trade association of and providing services to surplus and excess lines agents and brokers.

National Council on Compensation Insurance (NCCI) - National association that collects, tabulates, and provides data used in formulating rates for workers compensation insurance.

National Flood Insurance Program (NFIP) - A federal program through which per-sons with property located in predefined flood plains can obtain flood coverage. See Flood insurance.

Nationwide Definition of Marine Insurance - A document published by the National Association of Insurance Commissioners that was rooted in an older (1933) definition of "...Insuring Powers of Marine and Transportation Underwriters". In general, the "definition" specifies property that may be insured under marine contracts such as property in inland transport and property regularly or routinely in transit, e.g., contractors equipment.

Negligence - Action or failure to act that is outside the realm of what would be considered appropriate by ordinary, reasonably prudent persons.

Net loss - The amount of a loss, after deductions for salvage, other insurance, and any subrogation that an insurer is responsible for.

Net premium - Premium less expense, such as commission.

New York Standard Fire Policy - Once the benchmark of property policies, it was adopted for use in all but a handful of states. The familiar provisions of its 165-Numbered-Lines, e.g., cancellation, mortgagee, appraisal clauses, etc., survive in Insurance Service Office property policies as well as in independently produced forms.

No Benefit To Bailee - A clause in inland marine forms that prevents a person in the possession of property of others from benefiting from any insurance the owner has on the property.

No-Fault Auto Insurance - A few states have laws that partially exempt drivers from legal liability for auto accidents. In these "no fault" states car owners buy insurance to protect themselves and their passengers from the economic and medical effects of auto accidents in addition to liability insurance at whatever limit the statute decrees. Professors Robert Keeton and Jeffrey O’Connell gave the "no fault" notion impetus with the 1967 publication of their study "After Cars Crash."

NOC - Underwriter’s shorthand derived from general liability and workers compensation rating tables that stands for "not otherwise classified" meaning no more specific classification is available — as in "Clerical Office Employees NOC."

Nonadmitted Insurers, see Excess or surplus lines market.

Nonowned Auto - This term signifies an auto that is neither owned, hired, nor borrowed by the insured under a commercial auto policy. Employees’ cars used in company business are commonly classified this way. The employer’s auto liability cover for use of nonowned autos is covered by entry of symbol 1 ("any auto") or symbol 9 ("nonowned autos") on the declarations page.

Nonresident agent - An agent who does not reside in the state in which he or she is licensed.

Nose coverage - This is the opposite of Tail coverage, although it fulfills the same need. Nose coverage most commonly provides prior acts coverage for insureds who are moving from a claims-made coverage form to an occurrence coverage form. It is provided by the replacement policy.

Notice of loss - Notice the insured provides to the insurer that a loss has occurred.

Nuclear energy insurance pools - Any of the insurance pools designed to pro-vide property and/or liability coverage for organizations that handle substantial quantities of nuclear material.

Nuisance Value - The amount for which an insurance company will settle a claim - not because it is a valid claim but, because the company considers it worth that amount to dispose of it.