Glossary

Aviation hazard is a concept sometimes included in life insurance policies that involves the peril of death or disability arising from aviation operations other than commercial aircraft. Coverage for the aviation hazard may be limited in life and health policies by exclusion or be subject to additional premium.

Avoidance is a risk management tactic whereby risk of loss is prevented in its entirety by not engaging in activities that present the risk. For example, a construction firm may decide not to take on environmental remediation projects to avoid the risks associated with this type of work.

"A" rates refer to premiums charged for insurance that do not have loss experience statistics as a foundation for their development. The underwriter develops these rates subjectively, on an individual risk basis, according to what the underwriter believes is an equitable rate commensurate with risk involved.