Glossary

An afterburner is a pollution control device located so that the combustion gases are made to pass through its flame in order to remove smoke and odors. It may be attached to or be separated from the incinerator itself.

Aftermarket parts are auto crash parts produced by firms other than the manufacturer of the car. Usually, aftermarket parts are cheaper than the identical part from the automobile manufacturer. In an effort to keep costs (and, thus, premiums) down, insurers often repair damaged cars with such parts. Although they often are certified as being as good as the ones that come from the auto manufacturer, some consumer groups say that they have evidence that they are not.

An agency is an entity that sells insurance. It may be directed toward property and liability insurance, life and health insurance, or both. Also, it might be an independent organization or an insurer subsidiary.

An agency agreement is a written contract stipulating the arrangement between an insurance agency and the insurer it represents. Important details such as ownership of renewals, commission percentages, and duties and responsibilities of each party are usually spelled out in this agreement.

Unlike other forms of captives, agency captives are not designed to provide insurance for their owners. Instead, they benefit the insurer, agent, or broker that owns the company. Agents and brokers are often compelled to form captives to provide markets for their clients when the insurance market is in a "hard cycle."

Agency construction management is a professional fee-based arrangement in which the construction manager provides a variety of advisory services to the owner of a construction project without responsibility for providing any actual construction services. An agency construction manager does not contract with subcontractors. The agency construction manager offers advice and guidance on issues such as optimum use of available funds; control of the scope of the work; project scheduling; optimum use of design and construction firms' skills and talents; avoidance of delays, changes, and disputes; enhancing project design and construction quality; optimum flexibility in contracting; and procurement.

An agency plant represents the total force of an insurer's marketing force.

An agency system is an independent contractor approach to sales and service in insurance marketing. This is in juxtaposition to direct marketing, which uses salaried sales representatives or direct mail.

An agent is a person or organization that is authorized to act on behalf of another. An insurance agent is a person or organization that solicits, negotiates, or instigates insurance policies on behalf of one or more insurance companies. An insurance agent and can be independent or an employee of the insurer. Insurance agents are the legal representatives of insurers, rather than policyholders, with the right to perform certain acts on behalf of the insurers they represent, such as to bind coverage.

Agents errors and omissions (E&O) policies provide coverage for any act or omission of the insured (or of any other person for whose acts or omissions the insured is legally responsible), arising out of the performance of professional services in the insured's capacity as an insurance agent or insurance broker. Agents E&O policies provide protection for the negligent acts or omissions of insurance agents. Such policies do not cover intentional wrongdoing or harm, illegal actions, or employee injuries.