Home Owners Life/Disability Auto Motorcycle Boat Personal Umbrella

Policy Description Basic Homeowners Broad Homeowners Special Homeowners Compre. Homeowners Adequate Coverage Replacement Cost Large Deductible Renters Flood Tornado

Term Whole Life Universal Life Juvenile Life Disability

Policy Description Best Value/Dollar Blue Book Value

Property Casuality Niche Programs Employee Benefits

Property Bldg. Laws Safeguards General Liability Emp, Benefit Liab. Employer Liability Aircraft Products Liab. Sexual Harassment Dir. & Officers Liab. Professional Liability Elect. Data Proc. Cov. Kidnap or Ransom

Real Estate Brokers Capital Goods Manufact. Artisan Contractors Water Dealers Moving & Stor. Agenc. Religious Org. Program Not For Profit Org. Metalworkers

Traditional Voluntary Communications

[C008]

capacity

The amount of insurance (measured either by face value of policies or by premium) which an insurer is able or willing to issue as a maximum, as limited by legal restrictions, corporate restrictions, or indirect restrictions. Legal restrictions (e.g., "no policy may be issued for an amount in excess of 10% of policyholder surplus") or corporate restrictions (e.g., a board of directors resolution that "the company shall not knowingly commit itself to a policy amount in excess of $10 million") establish the maximum capacity an insurer is able to write. Indirect restrictions on the capacity an insurer is willing to write include:

1) the financial strength (policyholder surplus) of the insurer, or

2) the willingness of the insurer to venture a portion of its current anticipated underwriting (or overall) profit on a single policy (this willingness could also be expressed as a percent of annual premium) and the confidence felt in that anticipated result.

Copyright: The Rough Notes Company, Inc., 1998, All Rights Reserved. 3040100