Glossary

Suability factor signifies the likelihood of a legally liable insured being sued for alleged injuries or damage to a third party. This factor is determined, in part, by the size of the insured's savings account and stock portfolio, the extent of the real estate holdings, the family income, their profile in the community, and future income. Individuals with a high suability factor nearly always need a personal umbrella policy with at least a $2 million limit.

Subbroker is a second intermediary from whom a first reinsurance intermediary obtains reinsurance business to be placed.

The subcontractor exception is an exception to the "damage to your work" exclusion of the commercial general liability (CGL) policy that restores coverage when the damaged work, or the work causing the damage, was performed by the named insured's subcontractor. The subcontractor exception is the basis for much of the coverage available under a CGL policy with respect to construction defects. It can be removed from the policy by endorsement.

Subguard is a proprietary term for a specific insurer's subcontractor default insurance policy. Because it was the first policy of this type, the name has become a somewhat generic label for the type of coverage the policy provides.

Subjective symptoms are examination findings that are under the patient's control, such as pain and range of motion.

Subject business is a shorthand way of expressing "business of the class, size, and limitations" covered under a reinsurance agreement.

Subject of insurance involves one or more units of exposure potentially involved in a single-loss event.

Subject policies are issued by the original insurer (the "original policies") subject to the terms of a treaty reinsurance agreement.

Subject premium, in conjunction with retrospective rating, the portion of the premium applied to the retro formula. In reinsurance, the reinsurance rate is applied to the subject premium to produce the reinsurance premium. Subject premium is also known as the "base premium" or "underlying premium."

A sublimit is a limitation in an insurance policy on the amount of coverage available to cover a specific type of loss. A sublimit is part of, rather than in addition to, the limit that would otherwise apply to the loss. In other words, it places a maximum on the amount available to pay that type of loss, rather than providing additional coverage for that type of loss. In professional liability insurance, sublimits are usually a stated percentage of an aggregate limit of coverage under a policy. For example, under a lawyers professional liability policy written with a $500,000 aggregate limit of coverage, there may be a 10 percent sublimit on coverage (i.e., $50,000) for punitive damages. In property insurance, however, sublimits may be stated as dollar amounts or as a percentage of the limit that would otherwise apply. Further, under a commercial property policy with a $2 million limit applicable to loss from all other causes, there may be a $100,000 sublimit on coverage for loss from flood, a $500,000 sublimit on loss from earthquake, and a debris removal sublimit of 25 percent of the direct damage loss amount. In both examples, the sublimit is the most the insured can collect for the type of loss to which the sublimit applies.