Glossary

A negligent referral is a claim made against a professional who negligently refers a client/patient to another professional. Negligent referral claims are usually made when one professional refers a client/patient to a more specialized practitioner who then commits an error or omission that injures the claimant. For example, if a family physician refers a patient to a surgeon who injures the patient during an operation, the patient could allege that the family physician negligently referred them to the surgeon. Professional liability insurance typically covers negligent referral claims when they are made against the professional who refers a client/patient to another professional.

Negligent retention is a type of employment-related claim in which a plaintiff asserts that an employer failed to discharge an employee who management knew, or should have known, had a propensity toward violence, sexual harassment, or dishonesty. For example, negligent retention claims are often made after an employee commits a mass shooting at a plant or office. Injured workers then sue the employer, alleging that the company was negligent in not terminating the employee sooner. The basis of the claimants' argument is that on prior occasions, the employee had provided clear evidence of a propensity for such violence (e.g., they had issued threats or brought a weapon onto the company's premises). Coverage for such claims is available under employment practices liability insurance (EPLI) policies.

A network is an entity that negotiates discounted fees with medical providers and then passes part of the discount to insurers or employers, which pay for services provided to persons who access providers through the network. Some networks also establish standards of practice in addition to fee schedules.

For life insurance policies, the net cash surrender value is the cash surrender value less any outstanding loans and/or surrender charges.

Net interest earned is the amount of interest earned by an insurer on its investments, after deducting investment expenses but before federal income taxes.

The net level premium is the pure mortality cost of a life insurance policy from age of entry to maturity date.

The net level premium reserve is a premium reserve established for level premium ordinary life insurance policies in their initial years of coverage to offset inadequate premiums charged in later years. The net level premium reserve is based on the amount of excess premium charged in the initial years plus the interest earned on the accumulated excess premium. As long as the net level premium reserve exists for a policy, it comprises part of that policy's death benefit.

A net line is the amount of coverage an insurer retains on a specific risk after deducting reinsurance.

Net loss is the amount of loss sustained by an insurer after deducting collectible reinsurance, salvage, and subrogation recovery.

Net loss reserves are reserves for losses within the risk limitation. Gross loss reserves net of reinsurance credits and offsets.