Liability Terms

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Tail.

This term has been used to describe both the exposure that exists after expiration of a policy and the coverage that may be purchased to cover that exposure. On "occurrence" forms a claims tail may extend for years after policy expiration, and the losses may be covered. On "claims made" forms tail coverage may be purchased to extend the period for reporting covered claims beyond the policy period. See Mini, Midi, Maxi Tail.

Third Party Insurance.

A term for Liability Insurance. Liability always involves a third party, the one who has suffered a loss, in addition to the insurer and the insured. See also Liability Insurance.

Transition Program.

In commercial liability insurance, rules designed to offset wide differences in premiums for mercantile risks because of a change in the rating base from area to gross sales. It limits maximum and minimum premium changes resulting solely from the change in the rating base.

Trigger.

See Coverage Trigger.