D – Glossary of Insurance Terms
This page provides a glossary of insurance terms and definitions that are commonly used in the insurance business. New terms will be added to the glossary over time.
The definitions in this glossary are developed by the NAIC Research and Actuarial Department staff based on various insurance references. These definitions represent a common or general use of the term. Some words and/or phrases may be defined differently by other entities, or used in a context such that the definition shown may not be applicable. naic.org
Date of Issue – date when an insurance company issues a policy.
Declarations – policy statements regarding the applicant and property covered such as demographic and occupational information, property specifications and expected mileage per year .
Deductible – Portion of the insured loss (in dollars) paid by the policy holder
Deferred Annuity – annuity payment to be made as a single payment or a series of installments to begin at some future date, such as in a specified number of years or at a specified age.
Demutualization – conversion of a mutual insurance company to a capital stock company.
Dental Insurance – policies providing only dental treatment benefits such as routine dental examinations, preventive dental work, and dental procedures needed to treat tooth decay and diseases of the teeth and jaw.
Dental Only – line of business providing dental only coverage; coverage can be on a stand-alone basis or as a rider to a medical policy. If the coverage is as a rider, deductibles or out-of-pocket limits must be set separately from the medical coverage. Does not include self-insured business as well as FEHBP or Medicare and Medicaid programs.
Derivative – securities priced according to the value of other financial instruments such as commodity prices, interest rates, stock market prices, foreign or exchange rates.
Difference In Conditions (DIC) Insurance – special form of open-peril coverage written in conjunction with basic fire coverage and designed to provide protection against losses not reimbursed under the standard fire forms. Examples are flood and earthquake coverage.
Direct Incurred Loss – loss whereby the proximate cause is equivalent to the insured peril.
Direct Loss – Damage to covered real or personal property caused by a covered peril.
Direct Writer – an insurance company that sells policies to the insured through salaried representatives or exclusive agents only; reinsurance companies that deal directly with ceding companies instead of using brokers.
Direct Written Premium – total premiums received by an insurance company without any adjustments for the ceding of any portion of these premiums to the Reinsurer.
Directors & Officers Liability – liability coverage protecting directors or officers of a corporation from liability arising out of the performance of their professional duties on behalf of the corporation.
Disability Income – a policy designed to compensate insured individuals for a portion of the income they lose because of a disabling injury or illness.
Disability Income – Long-Term – policies that provide a weekly or monthly income benefit for more than five years for individual coverage and more than one year for group coverage for full or partial disability arising from accident and/or sickness.
Disability Income – Short-Term – policies that provide a weekly or monthly income benefit for up to five years for individual coverage and up to one year for group coverage for full or partial disability arising from accident and/or sickness.
Dividend – a refund of a portion of the premium paid by the insured from insurer surplus.
Domestic Insurer – an insurance company that is domiciled and licensed in the state in which it sells insurance.
Dual Interest – insurance that protects the creditor’s and the debtor’s interest in the collateral securing the debtor’s credit transaction. “Dual Interest” includes insurance commonly referred to as “Limited Dual Interest.”
Dwelling Property/Personal Liability – a special form of package policy composed of dwelling fire and/or allied lines, and personal liability insurance.