GLOSSARY OF TERMS

U TERMS

Umbrella Liability Policy: A policy designed to provide additional

protection against catastrophic losses covered under liability policies,

such as the business auto policy, commercial general liability policy,

watercraft and aircraft liability policies and employers liability

coverage. It provides excess limits when the limits of the underlying

liability policies are used up by the payment of claims and it drops

down and picks up where the underlying policy leaves off when the

aggregate limit of the underlying policy in question is exhausted by the

payment of claims. It also provides protection against some claims not

covered by the underlying policies, subject to a self-insured retention

Underinsured Motorists Coverage: Provides coverage for bodily injury,

and in some states property damage, for losses incurred by an insured

when an accident is caused by a motorist who does not have sufficient

insurance limits

Underlying Coverage: The insurance or coverage in place on the same

risk that will respond to loss before the excess policy is called on to

pay any portion of the claim

Underwriter: Company receiving premiums and accepting responsibility

for fulfilling the policy contract. Also, company employee who decides

whether the company should assume a particular risk; or the agent who

sells the policy

Uninsurable Risk: A person who is not acceptable for insurance due to

excessive risk.

Universal Life: An interest-sensitive life insurance policy that builds

cash values. The premium payer has control over how the policy is

structured. He has the flexibility to eliminate the premiums

(essentially pay up the policy and pay no more premiums) or have the

premiums continue for life. It is a matter of juggling three variables:

the assumed interest rate, the cash value and the premium payment

plan. The policy is interest-sensitive, and if interest rates change from

the assumed interest, it will affect the other two variables. In the

past, many Universal Life Policies were structured assuming a higher

interest rate then was actually received, therefore, most of them have

under performed. If you have a Universal Life Policy, you should have it

evaluated to see if it needs

to have the premiums adjusted to get it back on track. A fourth variable

that has not been a factor but could be in the future, and the owner

should be aware of, is the Mortality variable. Universal Life policies are

usually structured assuming current mortality rates. The insurance

companies reserve the right to change those rates.

Unearned Premium: That portion of the policy premium that represents

the unexpired policy term

Uninsured Motorist Coverage: Provides coverage for bodily injury, and in

some states property damage, for losses incurred by an insured when an

accident is caused by a motorist who is not insured

Utility Service Interruption Coverage: Coverage for the loss to an

insured due to lack of incoming electricity which was caused by damage

from a covered cause of loss, such as a fire or windstorm, to property

away from the insured's premises - usually the utility generating

station. Also referred to as 'off-premises power coverage'