The cancellation of an insurance or reinsurance contract from its beginning by an insurer or reinsurer on the basis of the misrepresentation and/or non-disclosure of material facts. The result is that the insurer/reinsurer has no liability under the contract but must repay the premium to the insured/reassured.

If the sum insured under non-marine insurance is expressed to be “subject to average” and that sum is less than the value of the subject matter of the insurance then any claim that is agreed under the policy will be reduced proportionately to reflect the under insurance.

Section 81 of the Marine Insurance Act 1906 say that an insured shall be his own insurer as regards any under insurance.

In marine insurance the term average may also refer to one of two types of loss, general average and particular average.

A person (usually a firm) that has been approved by the Financial Services Authority (FSA) to carry on one or more FSA regulated activities.

A person appointed by a power of attorney to act on behalf of another person.

Another term for inception date, being the date on which an insurance or reinsurance contract comes into force.

Another name for an insured.

A company that is permitted by Lloyd’s to perform specified functions that would normally be performed by a managing agent of a run-off syndicate on behalf of that agent or a substitute agent.

An individual who has been approved by the Financial Services Authority (FSA) to perform a FSA controlled function for an authorised person.

In the context of property insurance an increase in value of the property insured.

This term refers to the reconstitution of a syndicate as an annual business venture where insurance and reinsurance business is written on a year of account basis.

The reporting of syndicate results on a calendar year basis, with profit taking being restricted to earned premiums.

This may refer to a member’s allocated capacity or syndicate allocated capacity.

A property insurance which covers any accidental loss or damage that is not specifically excluded under the policy.

A corporate member of a syndicate that is directly or indirectly owned by the same firm that owns the managing agent of the syndicate.

An insurance contract under which the insurer agrees to pay the insured a stated amount in the event of the total loss of the property insured without any adjustment for depreciation or appreciation.

A syndicate business plan that has been approved by or on behalf of a Franchise Board. No managing agent may underwrite for a syndicate without an agreed syndicate business plan. Agreed syndicate business plans may be amended with the agreement of the Franchise Board or someone acting on its behalf.

A form of excess of loss reinsurance in which the excess and the limit of liability are expressed as annual aggregate amounts.

Total (limit of indemnity, premium, retention etc).

Someone who acts for another person (the principal) usually for reward.
There are four main classes of agent that may be involved in the underwriting of insurance and reinsurance risks by Lloyd’s underwriters: members’ agents, managing agents, brokers and coverholders. In addition, there are Lloyd’s agents which are independent businesses that provide surveys and loss adjusting services to managing agents, insurance companies and others on a worldwide basis. Further in some situations one underwriter may act as the agent of other underwriters (see general underwriters’ agreement).

An additional or return premium that is payable in relation to a deposit premium depending on the performance of an insurance or reinsurance contract.