Glossary

A nonstandard insurer is an insurance company that writes coverage for applicants or risks that do not meet the underwriting requirements of the standard insurance market. This can be because they present higher-than-average, unusual, or difficult-to-place exposures. Examples include insureds with adverse loss histories, poor driving records, properties in high-risk areas, specialized operations, or other characteristics that standard insurers are unwilling or unable to insure. Coverage typically is written with higher premiums, more restrictive terms, lower limits, or specialized policy forms, and may be provided through nonadmitted, excess and surplus lines, or other specialty markets.

Nonsubject premium is a premium that is not a part of a loss sensitive rating formula. For example, in a retrospective rating plan, the nonsubject premium usually purchases the excess insurance (over the loss limits). The expression "nonsubject" refers to the fact that the premium is a guaranteed cost and not adjustable based on losses.

A nonsubscriber workers compensation plan is when an employer elects, by filing appropriate notices required by state insurance authorities, to pay work-related injury loss through some method other than statutory workers compensation. Three states—Texas, New Jersey, and Oklahoma—allow such an election. Note that the purchase of workers compensation insurance is elective in Texas. In New Jersey, employers are required to purchase either workers compensation coverage or employers liability coverage. In Oklahoma, employers must either purchase workers compensation coverage or become a qualified employer under the Oklahoma Employee Injury Benefit Act (OEIBA).

Nonsubscription is an option available only in Texas that permits employers to elect not to participate in the workers compensation system. Nonsubscribing employers can be held liable in tort for injuries to employees, and they are not permitted to use the traditional common law defenses available to employers subject to workers compensation laws. Two special types of insurance policies can be purchased by nonsubscription employers: occupational accident insurance and employers excess indemnity insurance.

A nonsuit is a judgment issued by the court against the plaintiff dismissing the case, before the defense presents its case, based on the plaintiff's failure to produce sufficient evidence.

Nontransferability provisions refer to clauses found in professional liability policies indicating that an insured cannot transfer coverage to a noninsured without the insurer's approval. For example, attorney A who sells their practice to B cannot transfer coverage under their professional liability policy to B without the assent of their insurer. This is because professional liability insurance is a "personal" contract.

Noon clause is found in an insurance policy where the starting time of the coverage is noon on the date of coverage inception. The noon clause has been replaced in most policies with a time shown of 12:01 a.m.

Normal loss describes a noncatastrophic level of loss within the working layer. It is the predictable loss and encompasses expected loss.

The North American Industry Classification System (NAICS) is a system for classifying entities (including businesses, governmental entities, and private households) by type of economic activity.

Nose coverage applies to the period between the inception date and retroactive date in a claims-made liability policy, if the specified retroactive date is earlier than the inception date of the policy. Claims-made liability policies typically include a retroactive date, and the policy will not cover claims arising from covered occurrences, acts, or omissions committed prior to that date. It gets its name from its attachment to the "front" of the policy term, as opposed to "tail" coverage provided by an extended reporting period (ERP) on the end of a claims-made policy.