If you work in insurance, you know the industry has its own language. Baffling to outsiders, this “alphabet soup” can even throw the most experienced insurance professionals for a loop at times.
While there’s a ton of terminology of all types, this piece will focus on the acronyms commonly used in the world of Commercial Lines.
Common Commercial Lines Acronyms
What is BAP?
A business auto policy or BAP is used to insure regular vehicles that are used for business purposes. For example, a company-owned passenger car or truck that an employee drives to a work site could be insured with a BAP, whereas a fleet of trucks would require a commercial auto policy, which is different.
What is BOP?
A business owners policy or BOP is an insurance policy that covers business owners for both property and casualty (or liability) insurance. For small businesses like sole proprietorships, a BOP can be a convenient and affordable option to make sure they are covered both for property damage (fires and theft, for example) and for liability (injuries occurring on the property or errors and omissions).
What is CGL?
The letters CGL commonly mean two things: commercial general liability or comprehensive general liability.
This is a broad type of policy that covers general risks associated with doing business. Commercial liability insurance is actually inclusive of the risks covered by a comprehensive general liability policy.
What is comprehensive general liability?
This type of insurance covers bodily injury and property damage claims arising from a business’s use of contractors, or from tenants.
What is CIAB?
The Council of Insurance Agents and Brokers or CIAB is a trade association representing the world’s top 200 insurance agencies and brokerages. CIAB is based in Washington, D.C. and lobbies for issues concerning the insurance industry.
What is CICA?
The Captive Insurance Companies Association or CICA is a global association dedicated to protecting the interests of captive insurance companies.
What is CIPR?
The Center for Insurance Policy and Research or CIPR conducts studies, provides data, and educates people on issues that are relevant to the insurance industry. CIPR is a part of the National Association of Insurance Commissioners (NAIC).
What is CPE?
Continuing professional education or CE is a requirement to keep an active insurance license. Also known as CE credits, these units of education are earned by taking eligible courses throughout the year.
What is a CPP?
A commercial package policy or CPP is a type of business insurance that packages different lines of coverage together. For example, a CPP may include property insurance (covering property damage due to fires and natural disasters); casualty or liability insurance (covering losses due to liability); inland marine (insuring items while in transit across the country); and more. A CPP is customizable and does not have a set list of coverages.
What is D&O?
Directors and officers liability insurance is a line of coverage that protects a company from financial loss in the case that a director or officer of the company is liable for damages. It also serves the purpose of funding the defense of a director or officer accused of wrongdoing, although in many cases (fraud, criminal conduct) if the accused is found guilty, the insurance policy will require repayment of the legal costs it covered.
What is the DOI?
The department of insurance, or division of insurance, also known as DOI is the government entity that regulates the activities of the insurance industry within the state or territory.
Each state in the U.S., along with each U.S. territory, has its own department of insurance or division of insurance.
What is EPLI?
Employment practices liability Insurance or EPLI is a type of coverage for companies that have employees. It specifically covers claims for things related to employment practices, which may include harassment, toxic workplace claims, and wrongful termination lawsuits, among others.
What is E&O?
Errors and omissions insurance or E&O is a type of liability policy that protects professional service providers (lawyers or consultants, for example) from the liability they may face if their own error or omission causes harm to a client. E&O policies are also known as professional liability insurance (PLI) and professional indemnity insurance (PII).
What is E&S?
Excess and surplus lines or E&S is the name for any type of specialty coverage that the general insurance markets don’t cover. There are a large number of E&S coverages, including insuring festivals and events, mobile homes, and daycare centers.
What is IIABA?
Independent Insurance Agents & Brokers of America or IIABA, also known simply as “Big I”, is an association representing the independent agency channel in the United States. The organization provides services, education, and government advocacy for the industry – specifically for independent insurance agents and brokers.
What is an MGA?
A managing general agent or MGA is an intermediary between an insurance company (a carrier) and an insurance agent, broker, or producer. While MGAs can appoint agents and sell insurance products, they also take on some of the responsibilities normally associated with a carrier, like underwriting the risk and settling claims.
What is an MGU?
A managing general underwriter or MGU is similar to a managing general agent (MGA), and typically has a specialized area of coverage. Like MGAs, MGUs also take on some of the roles traditionally associated with insurance carriers. They have the ability to assess risk and underwrite policies. Often, MGUs are considered subject-matter experts in the lines of coverage they work with.
What is a NPN?
A national producer number or NPN is a unique identifier assigned to each producer, and most business entities (agencies and brokerages). You will need to apply for an NPN when first becoming licensed and know your NPN when renewing your license.
What is NRL?
Nonresident licensing or NRL is the type of insurance license given to producers who do not reside in a state, but who still sell products within it. In order to obtain an NRL, you must first have a valid producer license in your state of residence.
What is OSHA?
The Occupational Safety & Health Administration or OSHA is an agency of the US government that oversees workplace health and safety regulations. Businesses have to abide by OSHA rules and standards to ensure workplace safety for their employees and contractors. Failure to follow OSHA standards can get a business in trouble legally and lead to insurance claims.
What is P&C?
Property and casualty insurance or P&C is the type of insurance that protects individuals and businesses from losses associated with property, while also covering liability for damage to others. For example, property insurance would repair your car if it was damaged in an accident, while casualty insurance would pay for the repair of someone else’s car if you were legally responsible for the accident. Generally, property and casualty insurances are bundled together in a single policy, such as an auto policy.
This is, of course, only one area of pedantry in the insurance industry that can make it seem daunting to newcomers. If you want to shorten that learning cycle for your compliance or operations teams, see what AgentSync can do for you.