Glossary

GLOSSARY - LETTER N


Named Insured

Any person, firm, or corporation, or any member thereof, specifically designated by name as the insured(s) in a policy. Others may be protected as insureds even though their names do not appear on the policy. A common application of this latter principle is in Automobile policies where, under the definition of insured, protection is extended to cover other drivers using the car with the permission of the named insured.


Natural Death

Death by means other than accident or homicide.


Negligence

Failure to use that degree of care which an ordinary person of reasonable prudence would use under the given or similar circumstances. A person may be negligent by acts of omission or commission or both.


Net Interest Earned

The average interest earned by an insurer on its investments after investment expense but before federal income taxes.


Net Loss

The amount of loss sustained by an insurer after giving effect to all applicable reinsurance, salvage, and subrogation recoveries.


Net Premium

The amount of premium minus the agent's commission. The premium necessary to cover only anticipated losses, before loading to cover other expenses. The original premium minus dividends paid or anticipated in participating Life Insurance when the insured elects to use his dividends toward payment of the premiums. Contrast with Gross Premium.


Non-Admitted Reinsurance

A Company is “non-admitted” when it has not been licensed and thereby recognized by appropriate insurance governmental authority of a state or country. Reinsurance is “non-admitted” when placed in a non-admitted company and therefore may not be treated as an asset against reinsured losses or unearned premium reserves for insurance company accounting and statement purposes.


Noninsurance

Making no financial preparation for meeting losses.


Nonparticipating (Non-Par)

Insurance contrasts on which no policy dividends are paid because there is no contractual provision for the policy owner to participate in the surplus. Contrast with Participating.


Nonrenewal

Termination of insurance coverage at an expiration date or anniversary date. This action may be taken by an insurer who refuses to renew, or by an insured who rejects a renewal offer.


Notice of Cancellation

Written notice by an insurer of intent to cancel insurance, or written notice by an insured requesting cancellation.