The following glossary provides definitions of some of the terminology used on the website to discuss exhibits. This is provided to assist individuals that may not be familiar with everyday insurance language.

The automobile insurance coverage that pays for personal injuries to the individuals covered by the insurance policy.

All statistical exhibits listed in this catalogue are presented on an accident-year basis. To use an example, this means that the 2008 Calendar Accident Year includes all premium transactions that took effect between January 1 and December 31, 2008 and claims on all accidents that occurred between January 1 and December 31, 2008.

The average cost per claim is simply the total amount paid out for all claims divided by the total number of claims to obtain an average, sometimes referred to as the claims severity.

This could be an injury to a person from an automobile accident or a fall, sickness as a result of pollution, or any other type of injury to a person.

An event that has resulted in multiple insurance claims, such as an ice storm, earthquake or hail storm.

The average cost to an insurance company for every risk they insure. For example, in automobile insurance, this would be the total amount paid out in claims divided by the total number of vehicles insured.

The number of claims divided by the number of risks insured. For example, in automobile insurance, if 10 claims occurred and there were 100 vehicles insured, the claims frequency would be stated as 10 per 100 insured vehicles.

Classification is simply a way to group similar types of risks together. In the automobile insurance statistical exhibits, the Classification Exhibits present the results of different classes of drivers. These classes are derived from criteria such as age, gender and whether the vehicle is used to commute to work or used for pleasure only.

The portion of your automobile insurance policy that pays for the cost of repairing your vehicle if it is damaged in an accident that is your fault.

The portion of your automobile insurance policy that pays for the cost of damages or replacement of your vehicle as a result of such events as fire, vandalism and theft.

The amount that an insured person or business has agreed to pay in the event of a claim. For example, if you have a $500 deductible for your Collision coverage on your automobile insurance policy and you were at fault in an accident which caused $2,000 damage to your vehicle, you would be responsible for paying the first $500.

The portion of your automobile insurance policy that pays for the cost of repairing your vehicle if it is damaged in an accident that is not entirely your fault.

In the Classification Exhibits, the driving record is the number of years that the driver has been driving without an at-fault claim. For example, if you had a collision for which you were at fault during the last year, your driving record would be 0. If you had been driving for 6 years without having an at-fault claim, then your driving record would be 6.

Exposures are a measure of what is being insured. For example, an insured vehicle is an exposure. The term earned means that the exposures were in fact at risk of a loss in the period in question. For example, if a vehicle is insured as of July 1, 2008, then during the 2008 Accident Year, this would represent an exposure of 1/2 to the insurance company.

The loss ratio is the ratio of claims to premiums. For example, if, for a line of business during a given period, the total amount of losses and loss adjustment expenses is $9 million and the total premium collected during that period is $10 million, then the loss ratio is said to be 90 (90% of premiums).

The premium is the sum of money paid to the insurance company for protection against certain risks. The term earned means that the premiums were in fact for an exposure at risk of a loss in the period in question. For example, if a vehicle is insured as of July 1, 2008 for the sum of $1,000, then during the 2008 Accident Year, the earned premium would be $500. The other $500 would be earned in 2009.

Sometimes, the term earned vehicles will be used instead of earned exposures for automobile insurance. The definitions, however, are the same.

This abbreviation stands for Incurred But Not Reported. It simply means that some claims are still expected although they have not yet been reported to the insurance company. At the end of the year, for example, the insurance company will require a reasonable estimate of the total claims they will be required to pay for the year that has just passed. They will require an estimate of the claims that are expected, but have not yet been reported (IBNR).

The term incurred refers to the total of payments made on claims plus the amount still expected to be paid on those claims at the end of a given period. For example, suppose a claim occurs in September 2008 and an initial payment of $10,000 for damages is made in October. If, at the end of December, the company still estimates that they will have to make an additional payment of $5,000 on this claim, then, at the end of December, the 2008 paid losses are $10,000, the outstanding losses are $5,000 and the incurred losses are $15,000.

This term is used in some of the Commercial Liability Exhibits to describe specific types of commercial industries. Some of these include Metal Mining, Hog Farms, Armoured Cars and Tanneries.

The expenses directly related to the settlement of a claim, such as an adjuster’s fees and legal costs.

When an accident occurs, the total damage may not be readily known, so an estimate of the cost is provided. As the years progress and claim payments are made, the damages become better known and estimates are adjusted. This is called the loss development. For some types of claims, such as severe injuries, this process may take several years before the claim is considered closed and no more payments are expected. Actuaries use past data from similar types of claims to calculate loss development factors to apply to new claims. By applying these factors, they can make a reasonable estimate of what the final damages will be.

This term is used in some of the Commercial Liability Exhibits to describe major commercial industries. Some of these include Mining, Farming, Transportation and Warehousing.

Please see Incurred Claims/Losses.

Please see Incurred Claims/Losses.

This term is often defined as coverage or type of policy. For example, in commercial liability, Employers’ Liability, Pollution Liability and Directors’ and Officers’ Liability are all considered policy forms or coverages.

The maximum amount of damages that is covered by an insurance policy.

A vehicle not used as a commercial vehicle. For example, if a small van is used as a family vehicle, it is considered a private passenger vehicle. However, if this same van is used as a full-time delivery vehicle, it is considered a commercial vehicle.

Damages done to property, which could include a vehicle, a house or a commercial building.

The portion of your policy that covers damages to others, including their property, for which you are responsible.