Glossary F 

FAIR Plan See Fair Access to Insurance Requirements.

FCAS See Fellow of the Casualty Actuarial Society.

FDIC See Federal Deposit Insurance Corporation.

FEMA Federal Emergency Management Agency.

FLMI Fellow of the Life Management Institute. See Life Office Management Association.

face amount The principal amount of insurance provided at the time of issue by an insurance policy. The term derives from the fact that the amount of insurance is usually indicated on the first page or "face" of the policy.

face sheet A form attached to the policy identifying the insured, the subject matter of the insurance, the policy limits, etc. In casualty insurance, the face sheet is very often a copy of the declarations.

facility of payment Many weekly premium policies contain a provision that the company may pay the sum due on the policy to a relative, by blood or marriage, or to any person appearing to be entitled to the payment by reason of having incurred expenses on behalf of the insured or expenses for his or her burial.

Fair Access to Insurance Requirements (FAIR) plan A state-run property insurance plan that makes basic property insurance available to those in high risk areas who cannot obtain insurance through normal markets.

fair credit reporting act An act requiring that an applicant be informed in advance if an inspection/consumer report may be ordered. If insurance is declined due to information contained in that report, the applicant has the right to ask the inspection company about the information it obtained.

federal deposit insurance corporation (FDIC) A federal government agency that insures bank deposits up to a stated maximum.

federal estate tax An excise tax currently levied upon the transfer of property or interests in property at death. Life insurance proceeds are taxable if payable to the decedent's estate, or if payable to named beneficiaries and the insured possessed at death any incidents of ownership in the policy or policies. The value of life insurance policies owned by the decedent on the lives of others is also taxable.

fellow of the Casualty Actuarial Society (FCAS) Awarded by the completion of a series of examinations and other requirements.

fidelity bond A bond which will reimburse an employer for loss up to the amount of the bond, sustained by the employer named in the bond (the insured), due to any dishonest act of a covered employee.

fiduciary Holding in trust. A person upon whom a trust has been handed down. When an agent collects an insurance premium, he/she holds the money in a fiduciary capacity. The money does not belong to them, and they should remit the premium as soon as possible.

file-and-use law A law for regulating insurance rates under which insurance companies are required only to file the rates with state insurance department before putting them into effect.

financial responsibility law A law requiring motorists to furnish proof of their ability to pay damages up to a stipulated amount following a loss.

fire A combustion accompanied by a flame or glow that escapes its normal confines to cause damage.

flat cancellation Cancellation of a policy at or before it becomes effective. All premium is refunded to the insured.

fleet policy A policy which provides insurance for a number of vehicles owned by one insured.

floater policy A policy that covers property that can be moved from one location to another.

foreign insurer An insurance company chartered by one state but licensed to do business in another state(s).

forgery Imitating the signature of some other person with fraudulent intent.

form The insurance policy itself , the application, and any endorsements or riders which may be attached are each considered a "form" by the Departments of Insurance.

401(K)plan A qualified profit-sharing or thrift plan that allows eligible employees the option of putting money into the plan or receiving the funds as cash. This tax-deferred savings plan, authorized by Section 401(k) of the Internal Revenue Code, can be established with or without employer contributions.

fraternal organization A society or order that is organized solely for the benefit of its members and their beneficiaries, not for profit. This organization offers insurance only to its members.

fraud A false representation of a matter of fact (whether by words or conduct, by false or misleading allegations, or by concealment of that which should have been disclosed) which deceives and is intended to deceive another to his/her legal injury.

free look A period of time during which a policy owner may examine a newly issued policy and, if not satisfied, surrender it in exchange for a full refund of premium.