N – Glossary of Terms


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Name Position Bond:
A fidelity bond which covers losses caused by the dishonesty of only those employees named in the bond.

Named Perils:
Coverages in a property policy that provides protection from loss of perils specifically listed in the insurance policy. Examples of named perils are fire, windstorm, theft, smoke, etc.

National Association of Insurance Commissioners (NAIC):
The association of insurance commissioners of various states formed to promote national uniformity in the regulation and practice of insurance.

The failure to use the reasonable care that a prudent person would have used under the same or similar circumstances.

Net Premium:
A portion of the premium rate designed to cover benefits of the policy, but not expenses, contingencies, or profit.

A type of auto insurance mechanism whereby the right to sue another party for damages caused by negligence is limited and, in exchange, first party benefits are offered.

No-Fault Automobile Insurance:
A type of insurance in which financial losses resulting from an automobile accident are paid by your own insurer, regardless of who was at fault.

Non-Admitted Insurance Company:
An insurance company not licensed to do business in a particular state.

A contract that the insured has the right to continue in force by the timely payments of premiums set forth in the contract. No changes are made by the insurer during this period of time.

Nonconfining Sickness:
A sickness that does not confine an insured to his home or a hospital.

A term applied to employee benefit plans or insurance, which the employer pays the full cost of the premium for all of the employees.

Non-Disabling Injury:
An injury which does not qualify for total or partial disability.

Nonforfeitable Benefits:
A benefit under a pension plan that belongs unconditionally to the participant of that plan.

Nonoccupational Policy:
An insurance contract which insures a person against off the job accidents or sickness.

Nonowned Auto:
Any automobiles not owned, leased, hired, or borrowed which are used within the scope of business. Nonparticipating:
Insurance under which the policy holder is not entitled to share in the dividend distribution of the company.

The termination of insurance coverage at an expiration date or anniversary date.

Notice of Cancellation:
Written notice by an insurance company of their intent to cancel the policy.

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