Glossary

Rolling policy limits refers to an arrangement in which the amount of insurance stated at inception of the policy period is an aggregate limit over a multiyear period, with premium adjusted at each annual anniversary. This provides a continuous multiyear limit and an extended notice period for cancellation based not on the annual anniversary but the end of the multiyear policy period.

Rolling stock refers to all the vehicles, whether self-propelled or not, that operate on a railroad line. The term includes both locomotives and cars designed to carry persons or freight—tank cars, boxcars, flatcars, passenger cars. Physical damage coverage on rolling stock is a standard feature of railroad protective liability insurance.

A rolling wrap-up is a controlled insurance program that insures an ongoing construction program and can include multiple projects. Projects are rolled into and out of the program as they are started and completed. The date projects are removed from the program can vary, but most provide an extended period of completed operations coverage.

Root cause analysis (RCA) represents a common technique used to understand the "why" of loss events in order to prevent their reoccurrence. While stopping the reoccurrence of all claim and insurance fraud may not be a realistic goal, the root cause analysis technique will often yield clues useful in modifying the exposure or risk and possibly reduce similar loss events in the mid to long term. That is a realistic objective and one that has perfect application to fraud.

Royalty interest describes the ownership of a portion of the resource or revenue produced from the leased property. Typically, the owner of the leased property retains a royalty interest. The party with the royalty interest is not responsible for the costs and liabilities associated with the exploration, development, and operation of a well.

Rule 11 sanctions are sanctions (court-ordered fines) imposed against attorneys or parties for abuse of process. They attempt to prevent frivolous, unfounded lawsuits.

The running down clause in an ocean marine hull policy adds legal liability coverage for damage done to another ship or its cargo resulting from a collision with, and caused by, the insured vessel.

A runoff provision is a provision in a claims-made policy stating that the insurer remains liable for claims caused by wrongful acts that took place under an expired or canceled policy for a certain time period. For example, consider a policy written with a January 1, 2025–2026, term and a 5-year runoff provision. In this situation, coverage will apply under the runoff provision to all claims caused by wrongful acts committed during the January 1, 2025–2026, policy period that are made against the insured and reported to the insurer from January 1, 2026–2031 (i.e., the 5-year period immediately following the expiration of the January 1, 2025–2026, policy). Although runoff provisions function in a manner that is identical to extended reporting period (ERP) provisions, there are several differences. First, ERPs are generally written for only 1-year terms, whereas runoff provisions normally encompass multi-year time spans, often as long as 5 years. Second, while ERPs are most frequently purchased when an insured changes from one claims-made insurer to another, runoff provisions are generally used when one insured is acquired by or merges with another. In such instances, the acquired company buys a runoff provision that covers claims associated with wrongful acts that took place prior to the acquisition but are made against the acquired company after it has been acquired.

A regulatory sandbox is a limited-time controlled testing framework established by regulators that allows insurers, financial institutions, InsurTechs, fintechs, or others to test new products, services, technologies, or business models under regulatory supervision. While being conducted, the sandbox may permit modified or limited regulatory requirements. It generally includes safeguards such as eligibility criteria, defined testing parameters, consumer protections, reporting obligations, and an approval or exit process. The goal is to encourage innovation while at the same time helping regulators evaluate risks, compliance issues, and whether existing rules should be adapted.

A resilient bond, also referred to as a resilience bond, is a financing instrument that links catastrophe bond risk transfer with funding for projects that reduce disaster risk. It allows governments, utilities, insurers, or other sponsors to transfer defined catastrophe exposure to investors. It does so by using savings from reduced expected losses to help finance infrastructure or mitigation projects. This is referred to as a resilience rebate. The principal is encouraging investment in resilience while providing financial protection for other remaining catastrophic exposure. Examples include seawalls, flood barriers, retrofits, and other safety measures.