INSURANCE GLOSSARY
The Insurance Terms Glossary is divided alphabetically for ease of browsing. Select the alphabet letter that corresponds to the first letter of the word you would like to be informed about to open the appropriate heading.

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Glossary Terms ' D '

D&O Insurance - See Directors' and Officers' Liability Insurance.

Damage to Property of Others - Coverage for an insured who damages another's property. Payment is made despite the lack of legal liability. Coverage is included in Section II of the homeowners policy.

Death Benefit - A payment made to a designated beneficiary upon the death of the employee annuitant.

Debenture - A bond that is backed only by the general credit of the issuing corporation. No specific property is pledged as security behind the loan.

Debit Insurance - See Industrial Life Insurance.

Debris Removal Clause - This clause extends insurance coverage to include the cost of debris removal resulting from damage caused by a covered loss up to a specified limit of loss. The clause is an additional property insurance coverage.

Declarations - Statements in an insurance contract that provide information about the property or life to be insured. Used for underwriting and rating purposes and identification of the property or life to be insured.

Declination - The insurer's refusal to insure an individual after evaluation of the application for insurance and any other pertinent factors.

Decreasing Term Life Insurance - Term Life Insurance is designed to provide a fixed death benefit that is available for premium paid during a given term. Decreasing Term Life Insurance is similar except that the of the policy limit decreases while the premium is generally flat. This type of insurance is useful for guaranteeing mortgage payments and other credit balances that decrease by a fixed amount over time.

Deductible - An amount that a policyholder agrees to pay per claim or per accident toward the total amount of an insured loss.

Deferred Annuity - An annuity providing for the income payments to begin at some specified future date.

Deferred Compensation - Arrangements by which compensation to employees for past or current services is postponed until some future date.

Deferred Group Annuity - A type of group annuity providing for the purchase each year of a paid-up deferred annuity for each member of the group the total amount received by the member at retirement being the sum of these deferred annuities.

Defined Benefit Plan - A pension plan stating either (1) the benefits to be received by employees after retirement or (2) the method of determining such benefits. The employer's contributions under such a plan are actuarially determined.

Defined Contribution Plan - A plan under which the contribution rate is fixed and benefits to be received by employees after retirement depend to some extent upon the contributions and their earnings.

Dental Insurance - Individual or group plan that helps pay costs of normal dental care as well as damage to teeth from an accident.

Dependency Period - Period of time following the readjustment period during which the surviving spouse's children are under eighteen and therefore dependent of the parent.

Dependent Benefits - Social Security benefits available to the spouse or children of a Social Security beneficiary.

Deposit Administration Group Annuity - A type of group annuity providing for the accumulation of contributions in an undivided fund out of which annuities are purchased as the individual members of the group retire.

Deposit Premium - The money paid by a prospective policyholder when an application is made for an insurance policy. It is usually equal at least to the first month's estimated premium and is applied toward the actual premium when billed.

Deposit Term Insurance - A form of term insurance not really involving a "deposit" in which the first-year premium is larger than subsequent premiums. Typically a partial endowment is paid at the end of the term period. In many cases the partial endowment can be applied toward the purchase of a new term policy or perhaps a whole life policy.

Depreciation - A decrease in the value of property over a period of time due to wear and tear or obsolescence. Depreciation is used to determine the actual cash value of property at time of loss.

Diagnosis-Related Groups - System that reimburses health care providers fixed amounts for all care given in connection with standard diagnostic categories.

DIC Insurance - See Difference-in-Conditions Insurance.

Direct Loss - Financial loss that results directly from an insured peril.

Direct Placement - Sale of an entire issue of bonds or stock by the issuer to one or a few large institutional customers such as an insurance company without trying to market the issue publicly.

Direct Premiums Written - Property and casualty insurance premiums written (less return premiums) without any allowance for premiums for assumed or ceded reinsurance.

Direct Response System - A marketing method where insurance is sold without the services of an agent. Potential customers are solicited by advertising in the mail newspapers magazines television radio and other media.

Direct Writer - The industry term for a company that uses its own sales employees to write its policies. Sometimes refers to companies that contract with exclusive agents.

Directors' and Officers' Liability Insurance - Covers the exposure of corporate managers to claims from shareholders government agencies and employees and others alleging mismanagement.

Disability - A physical or a mental impairment that substantially limits one or more major life activities of an individual. It may be partial or total. See Partial Disability; Total Disability.

Disability Benefit - (1) Periodic payments usually monthly payable to participants under some retirement plans if such participants are eligible for the benefits and become totally and permanently disabled prior to the normal retirement date. (2) A feature added to some life insurance policies providing for waiver of premium and sometimes payment of monthly income if the policyholder becomes totally and permanently disabled.

Disability Income Insurance - A form of health insurance that provides periodic payments to replace income when an insured person is unable to work as a result of illness injury or disease.

Disability Insured - Status of an individual who is insured for disability benefits under the Old-Age Survivors and Disability Insurance (OASDI) program. The covered person must be fully insured and have at least twenty quarters of coverage out of the last forty ending with the quarter in which the disability occurs. Fewer quarters are required for persons under age thirty.

Disappearing Deductible - Deductible in an insurance contract that provides for a decreasing deductible amount as the size of the loss increases so that small claims are not paid but large losses are paid in full.

Dishonesty Bond - See Fidelity Bond.

Dismemberment - Loss of body members (limbs) or use thereof or loss of sight due to injury.

Dismemberment Insurance - A form of health insurance that provides payment in case of loss by bodily injury of one or more body members (such as hands or feet) or the sight of one or both eyes.

Disposable Personal Income - Personal income less personal tax and basic nontax payments. It is the income available to people for discretionary spending and saving.

Dividend - (1) A return of part of the premium on participating insurance to reflect the difference between the premium charged and the combination of actual mortality expense and investment experience. Such premiums are calculated to provide some margin over the anticipated cost of the insurance protection. (2) In capital stock companies a share of the profits distributed to stockholders.

Dividend Addition - An amount of paid-up insurance purchased with a policy dividend and added to the face amount of the policy.

Dollar Threshold - No-fault auto insurance states with the dollar threshold prevent individuals from suing in tort to recover for pain and suffering unless their medical expenses exceed a certain dollar amount.

Domestic Insurer - An insurance company is a domestic company in the state in which it is incorporated. See also Foreign Insurer Alien Insurer.

Domestic Partnership - A couple who form a union who desire to share an exclusive life together and are of the same sex. See also Insurance Considerations for Domestic Partners.

Donor - The person making a gift.

Double Indemnity - A policy provision usually associated with death which doubles payment of a designated benefit when certain kinds of accidents occur.

Dramshop Law - Law that imputes negligence to the owner of a business that sells liquor in the case that an intoxicated customer causes injury or property damage to another person. Usually excluded from general liability policies.

Dread Disease Insurance - Insurance providing an unallocated benefit subject to a maximum amount for expenses incurred in connection with the treatment of specified diseases such as cancer poliomyelitis encephalitis and spinal meningitis.

DRG - See Diagnosis-Related Groups.

Driver Education Credit - Student discount or reduction in premium amount for which young drivers become eligible on completion of a driver education course.

Duplication of Benefits - Overlapping or identical coverage of the same insured under two or more health plans usually the result of contracts of different insurance companies service organizations or pre-payment plans; also known as multiple coverage.