Glossary D 

debris removal A clause often added to the policy under which the company assumes liability for the removal of debris resulting from damage to the property covered by the peril insured against.

declarations Statements made by the applicant relating to the risk. In casualty insurance, the declarations are frequently made a part of the policy - included in this portion of the contract is descriptive information relating to the subject covered, insured, policy period, policy limits, deductible and premium.

declination Rejection of an application for insurance by the insurer.

deductible A certain dollar amount beyond which insurance protection begins. The insured assumes the loss up to the deductible limit and the insurer pays the remainder, up to the policy limit.

deferred annuity An annuity contract which provides for the postponement of the commencement of annuitized payments until after a specified period or until the annuitant attains a specified age. Deferred annuities may be purchased either on the single premium or annual premium basis. Deferred annuities are sometimes known as "retirement annuities."

demolition clause Used to insure against loss resulting from laws or ordinances regulating construction or repair. Requires additional premium.

deposit premium (dep. prem.) That premium paid at the inception of the policy based on known or expected exposures. Premium is adjusted following an audit, to reflect the actual exposures during the policy period.

depreciation The decline in value of property due to age, use, wear and tear, etc. Depreciation is a very important item in the adjusting of property losses.

direct loss Loss of, or damage to, the primary subject of the insurance agreement which is the immediate result of a hazard insured against. It is frequently very difficult to determine whether a loss is direct or consequential.

direct-response insurer An insurer that sells through the mail or other mass media (e.g., newspapers, magazines, radio). No agents are used to sell the insurance.

direct writer An insurer in which the salesperson is an employee, not an independent contractor.

disability income insurance A form of insurance that provides periodic payments to replace income if the insured is unable to work due to injury or illness.

discovery period A term used in the bonding business. An employee might misappropriate money during the term of a fidelity bond but the employer might not discover this until several months after the termination of the bond. Bonds usually provide a definite period of time after their expiration during which the employer may discover dishonest acts committed while the bond was in force.

dividend In insurance, this means a refund to the policyholder of that portion of their premium which is not needed to pay their share of the losses and expenses incurred during the policy period. Dividends are paid by mutual, participating stock companies and sometimes by reciprocals.

dividend additions Participating policies provide that policy dividends may be used as single premiums at the insured's attained age to purchase paid-up insurance as additions to the amount of insurance specified on the face of the contract. See paid-up additions.

domestic insurance company An insurer organized under the law of the state of domicile.

double indemnity Payment of twice the basic benefit if the loss results from specified causes or under specified circumstances.

draft An instrument, similar in appearance to a check, directing the payment of money subject to approval by the payor when presented for payment. Most often used for payment of insurance losses.