Glossary

Under the Employee Retirement Income Security Act (ERISA), a benefit plan is a promise by an employer to provide benefits to employees, where the funds for payment of the benefits are transferred to a party unrelated to the employer, such as an insurance company.

Best available control measures (BACM) refer to the most effective measures—according to Environmental Protection Agency (EPA) guidance—for controlling small or dispersed particulates from sources such as roadway dust, soot, and ash from woodstoves and open burning of brush, timber, grasslands, or trash.

As identified by the Environmental Protection Agency (EPA), best demonstrated available technology (BDAT) is the most effective commercially available means of treating specific types of hazardous waste.

Best's capital adequacy ratio (BCAR) is an important financial benchmark from A.M. Best that is intended to provide an indication as to whether a company has adequate capital to address its insurance and other risk exposures.

Best's rating is a rating system developed and published annually by A.M. Best Company that indicates the financial condition of insurers.

A betterment clause, often found in the physical damage section of automobile insurance policies, stipulates that if the repair or replacement of the damaged parts results in better than "like kind or quality," the insurers will not pay for this net improvement.

A bid bond is provided by a contractor in a competitive bidding situation as a means of guaranteeing that, if awarded the project based on the bid submitted, the contractor will execute the contract for the quoted price.

Bid deducts refer to the insurance credits contractors are expected to subtract from their quoted price when a wrap-up insurance program provides specified coverages for the project.

Bifurcation typically refers to situations in which the issues of liability and damages are separated and tried independently.

A bilateral extended reporting period (ERP) provision in claims-made policies allows the insured to purchase an ERP if either the insured or the insurer decides to cancel or nonrenew the policy.