Glossary

Step rate premium refers to life or health insurance policy that has built-in rate increases that are based on reaching certain ages or numbers of years in force.

Stevedores legal liability coverage provides liability insurance including coverage for care, custody, and control for stevedoring operations related to the exposures arising from the loading and unloading of cargo from vessels. Stevedoring organizations are responsible for the damage to the vessel, the cargo being loaded or unloaded, and surrounding property like other vessels, docks, and wharves caused by the negligent acts of their employees.

Stevedoring is the act of loading or unloading cargo from vessels. While third-party bodily injury or property damage arising out of stevedoring operations are covered under the standard commercial general liability policy, damage to the property being loaded or unloaded would not be covered unless the policy was specially modified to do so. A special endorsement is needed on the workers compensation policy to cover benefits payable to stevedoring employees under the US Longshore and Harbor Workers' Compensation Act (LHWCA), if applicable.

A stipulation is an agreement reached between the parties. For example, both parties to a lawsuit might stipulate to certain facts so that neither party will have to prove those facts.

Stochastic dominance refers to the use of historical empirical data to support future projections in terms of probability. It is a form of stochastic ordering. Stochastic dominance refers to one data set's dominance over another relative to the value of the outcomes. For example, when comparing the relative value of two investments (asset A and asset B), the one whose probable rate of return exceeds the other, at any level, is stochastically dominant.

Stock captive describes a special purpose limited liability insurer that raises capital by selling shares to shareholders and is controlled by its shareholders.

Stock company refers to an insurance company that has, in addition to surplus and reserve funds, a capital fund paid in by stockholders. Shares of stock companies are usually traded on one of the organized stock exchanges. A stock company is distinct from mutual or cooperative companies, which have no stockholders.

Stock option is a right to purchase shares of stock in a corporation at a specified price, usually, but not always, on or before a specified date. Stock options are routinely offered to corporate officers and directors (and sometimes to employees) as a means of providing them with added incentive to improve the firm's profitability, which, in theory at least, will boost the market price of the corporation's stock. In recent years, the granting of stock options has been the subject of litigation against a number of corporations and their directors and officers by plaintiffs who have alleged that these organizations engaged in the practice of illegally "backdating" option grants.

Stock option claims involve allegations by current or former employees that they have been wrongfully deprived of monies due from stock option grants provided by the organization. The largest stock option claims involve those by high-level executives who, following termination or forced resignation, assert that they have been wrongfully deprived of the financial gain produced by stock option grants. Such claims are covered by employment practices liability insurance policy forms.

Stop-loss reinsurance is an agreement whereby a reinsurer assumes on a per-loss basis all loss amounts of the reinsured, subject to the policy limit, in excess of a stated amount. This should not be confused with aggregate stop-loss reinsurance.