Glossary

A small quantity generator is an enterprise that produces 220–2,200 pounds per month of hazardous waste; such operations are required to keep more records than conditionally exempt generators. The largest category of hazardous waste generators, small quantity generators include automotive shops, dry cleaners, photographic developers, and a host of other small businesses.

A smart contract is a self-executing digital agreement whose terms are written into computer code and usually stored on a blockchain or other distributed ledger. As long as predefined conditions are met, the code automatically performs the required action without the need for manual processing or third-party intervention. Examples include transferring funds, recording ownership, verifying compliance, or triggering a payment. In an insurance context, smart contracts may be used to automate parts of underwriting, policy administration, parametric claim payments, reinsurance transactions, or other data-driven processes. While smart contracts generally improve the speed, consistency, and transparency of such transactions, they may also create risks related to legal and coding errors, cyber security, data accuracy, and regulatory treatment.

A smooth limit in some aircraft insurance policies is a combined single limit that applies to all bodily injury and property damage that arises out of a single occurrence. A smooth limit offers flexibility as it applies to any combination of third-party bodily injury, bodily injury to passengers, or property damage.

Social engineering describes the art of manipulating people in an online environment, encouraging them to divulge—in good faith—sensitive, personal information, such as account numbers, passwords, or banking information. Social engineering can also take the form of the "engineer" requesting the wire transfer of monies to what the victim believes is a financial institution or person, with whom the victim has a business relationship, only to later learn that such monies have landed in the account of the "engineer." Coverage for losses sustained by means of social engineering is available by endorsement under cyber and privacy insurance policies, although typically limited to $100,000. In addition, social engineering coverage (also known as fraudulent instruction coverage) only applies as excess coverage over limits available under any applicable commercial crime insurance policy.

Social inflation is a term given to the phenomenon of unexpected rising insurance claim costs because of societal trends and views toward litigation. While social inflation as a concept is not new, it has become very popular in the insurance press and appears frequently in the general press. Nearly every insurance company CEO is talking about social inflation and how claims costs are increasing in ways that were not anticipated. Social inflation is similar to any emerging risk, except that social inflation is not an actual risk but a driver of the increased costs to address risks. Like emerging risks, the effects of social inflation may skew reinsurance contracts by significantly altering the economic underpinnings of the reinsurance contract from when originally written.

The Society of Professional Benefit Administrators (SPBA) is a nonprofit national trade association founded in 1975 and headquartered in Chevy Chase, Maryland, whose members include third-party administration firms who provide comprehensive ongoing administrative services to client employee benefit plans and, under its stop loss service partner category, for insurers, managing general underwriters, and reinsurers of self-funded health plans. The SPBA promotes the public understanding and acceptance of contract administration.

A soft market is one side of the market cycle that is characterized by low rates, high limits, flexible contracts, and high availability of coverage.

A soft target refers to a building or facility with such light security and protective safeguards that it is an easy target for an act of violence, such as by terrorists.

A solicitor is a representative of an agent appointed and authorized by that agent to solicit and receive applications for insurance.

The solvency margin is the insurer's unimpaired surplus as a percent of outstanding loss reserve.