Glossary

Current assumption whole life insurance is a nonparticipating whole life policy that acts similarly to a universal life insurance policy in that it has an accumulation account from which mortality and other costs are deducted while interest is credited based on investment results.

Current disbursement is the pay-as-you-go technique to funding a pension plan. It is used today in Social Security and is known as the most costly method of pension funding.

The current service benefit is the portion of an insured's pension benefit that has accrued due to credited service in a given time period.

Customer's auto is a policy term that is defined in the Insurance Services Office, Inc. (ISO), garage policy. The term is defined to include autos of employees and members of their households while they are left with the insured garage for service, repair, storage, or safekeeping when these individuals pay for services performed.

A custom bond, required by the US Customs Service, guarantees the payment of duties or taxes due by law on all goods directly or indirectly imported or exported to or from the United States as well as the reporting of statistical data relating to the shipments involved. The bond may be issued on either a single or a continuous form.

A cutoff is a termination provision in a reinsurance contract under which the reinsurer is not liable for losses taking place after the date of termination.

A cut through clause is a clause used with retrocessions. The primary insurer has the ability to receive reinsurance payments directly from the retrocessionaire if unable to recover from the reinsurer.

A cut through endorsement is a reinsurance contract endorsement providing that, in the event of the cedent's insolvency, the reinsurer will pay any loss covered by the reinsurance contract directly to the insured.

Cyber-extortion coverage is an insuring agreement contained within some policies written to cover claims associated with data breaches. Such policies are most often termed "cyber and privacy insurance," "information security and privacy insurance," and "cyber-security insurance." The insuring agreement covers the costs associated with a cyber-extortion event (e.g., an insured receives an email stating that the extortionist will introduce a virus into the insured company's website unless the company pays a $10 million ransom). The costs covered by this insuring agreement include (1) monies paid to meet extortion demands, (2) the cost of hiring computer security experts to prevent future extortion attempts, and (3) the expenses charged by professionals to deal/negotiate with cyber-extortionists. A few insurers do not offer cyber-extortion coverage (also known as "e-commerce extortion coverage") because similar protection is available under kidnap and ransom insurance policies. Similar to other cyber and privacy insurance policies, cyber-extortion coverage is subject to an annual aggregate limit and an annual aggregate deductible.

A cyber-physical attack is a security breach that impacts operations, damages property, or otherwise impacts the physical environment. A malicious user can take control of the computing or communication components of water pumps, transportation, pipeline valves, etc., and cause damage to property and put lives at risk.