The agency operations glossary.

Account manager

An account manager in an independent insurance agency owns the ongoing service of a book of clients: renewals, endorsements, certificates, billing questions, and carrier follow-up. Producers sell the account. Account managers keep it. In commercial lines the title usually implies real ownership: the account manager runs the renewal, not just the tasks around it.

ACORD

ACORD, the Association for Cooperative Operations Research and Development, is the nonprofit standards body for the insurance industry, founded in 1970. Agencies know it for ACORD forms: the standardized applications, certificates, and binders that carriers across the market accept, like the ACORD 125 commercial application or the ACORD 25 certificate of liability insurance.

Additional insured

An additional insured is a person or business added to someone else's insurance policy by endorsement, giving them coverage for liability arising out of the named insured's work or operations. It is standard in construction and service contracts: the hiring party wants protection under the contractor's policy, not just proof the policy exists.

Agency bill vs direct bill

Agency bill and direct bill are the two ways premium gets collected on a policy. Under direct bill, the carrier invoices the insured directly and pays the agency its commission later, usually on a monthly statement. Under agency bill, the agency invoices the client, collects the premium, keeps its commission, and remits the net amount to the carrier or wholesaler.

Agency management system (AMS)

An agency management system (AMS) is the core software an insurance agency runs on: client records, policy detail, documents, activities, and usually accounting and commission tracking in one database. Common systems include Applied Epic, HawkSoft, EZLynx, AMS360, NowCerts, and QQ Catalyst.

Binder

A binder is temporary proof that insurance coverage is in force before the carrier issues the actual policy. It is a contract of insurance in its own right: once coverage is bound, the carrier is on the risk, even though the full policy documents have not been produced yet.

Binding coverage

Binding coverage means putting insurance in force. Once a risk is bound, the insured is covered, even if the policy documents have not been issued yet. Only someone with binding authority from the carrier can bind, and binding outside that authority is one of the fastest routes to an E&O claim.

Book of business

A book of business is the full set of clients and policies an agency or an individual producer manages, usually described by total written premium and the commission revenue it generates. It is the core asset of an independent agency: when an agency sells, the book and its retention are what the buyer is paying for.

Book roll

A book roll is the transfer of a block of policies from one carrier to another, usually processed policy by policy as each one comes up for renewal. Agencies roll books when a carrier exits a state or line, changes appetite, prices itself out of the market, or when a new carrier offers better terms for that class of business.

BOR letter (broker of record)

A broker of record (BOR) letter is a document signed by the insured that names a new agent or broker as their representative with a carrier. Once the carrier accepts it, the new agency takes over servicing the account and, in most cases, the commission. The policy itself does not change.

Carrier appetite

Carrier appetite is the set of risks a carrier actually wants to write right now: the industries, lines, sizes, and territories where it will quote competitively. It is narrower than what the carrier is licensed to write, and it moves with market conditions.

Carrier appointment

A carrier appointment is the formal authorization for an agency or producer to sell a carrier's products and bind its policies. It is a contract: the carrier files the appointment with the state, sets commission terms, and usually expects production in return. No appointment, no direct access to that market.

Carrier portal

A carrier portal is the website an insurance carrier provides to its appointed agents for quoting, issuing, servicing, and billing policies. Every carrier runs its own, with its own login, navigation, and quirks, so an agency appointed with a dozen carriers is managing a dozen separate portals.

Certificate of insurance (COI)

A certificate of insurance (COI) is a one-page summary of a policy's coverage, issued as proof of insurance to a third party called the certificate holder. The most common version is the ACORD 25 for liability. A certificate is informational only: it does not amend the policy and grants the holder no coverage.

Commission statement

A commission statement is the carrier's periodic report, usually monthly, of what it owes the agency on direct bill business. It lists each policy that generated commission that period: insured name, policy number, premium, commission rate, and the amount paid. Agencies reconcile it against their management system to confirm they got paid on every policy they placed.

Comparative rater

A comparative rater is software that takes one set of client data and returns indicative rates from multiple carriers at once, so the agency does not re-key the same risk into each carrier's system. Raters are strongest in personal lines auto and home. Commercial lines coverage is thin.

CSR (customer service representative)

A CSR (customer service representative) is the agency staffer who services the book of business: certificate requests, endorsements, billing questions, claims handoffs, and renewal prep. In commercial lines shops the same role is often titled account manager. Producers sell the account; CSRs keep it.

Dec page (declarations page)

The dec page, short for declarations page, is the front section of an insurance policy that states the specifics: named insured, carrier, policy number, policy period, coverage limits, deductibles, premium, and the schedule of forms and endorsements attached. It is the fastest way to see what a policy actually provides.

Endorsement

An endorsement is a written amendment to an insurance policy. It can add, remove, or change coverage, insureds, property, or terms, either at issuance or mid-term. Once issued, the endorsement is part of the policy contract and overrides the base form wherever the two conflict.

Errors and omissions (E&O)

Errors and omissions (E&O) insurance is professional liability coverage for insurance agencies and other professional firms. For an agency, it responds when a client claims the agency's mistake caused a financial loss: coverage that was never placed, limits that were too low, or a change that was requested but never processed.

Hard market

A hard market is the phase of the insurance cycle when premiums rise, underwriting tightens, and capacity shrinks. Carriers raise rates, cut limits, add exclusions, nonrenew business they no longer want, and pull out of whole states or classes. For agencies, it means far more remarketing and harder conversations at renewal.

Insurance intake

Insurance intake is the process of collecting the information needed to quote and write a policy: applicant details, operations, exposures, prior coverage, and loss history. It is the front door of new business. Weak intake shows up later as carrier follow-up questions, re-keyed data, and quotes built on wrong assumptions.

IVANS

IVANS is the connectivity network that moves data between insurance carriers and agency management systems. Its best-known service, IVANS Download, delivers policy, billing, and claims updates from carriers into the agency's AMS, so the system reflects what the carrier issued without anyone re-keying it. IVANS has been part of Applied Systems since 2013.

Loss ratio

Loss ratio is losses divided by premium, expressed as a percentage. A book that earns $100,000 of premium and pays out $60,000 in claims runs a 60% loss ratio. Carriers track it by policy, by line of business, and by agency, and it drives how they treat all three.

Loss runs

Loss runs are the official claim history report for an insurance policy, produced by the carrier. They list every claim filed under the policy: date, type, amount paid, amount reserved, and whether the claim is open or closed. Underwriters use them to price new business, so almost every commercial submission asks for three to five years of loss runs.

MGA (managing general agent)

An MGA, or managing general agent, is an intermediary that a carrier grants underwriting authority: the power to price, quote, and often bind policies on the carrier's paper. Retail agencies use MGAs to reach niche or hard-to-place risks their direct carrier appointments will not write.

New business

New business is any policy an agency writes that is not a renewal of an existing policy: a brand-new client, or a new line of coverage for an existing client. Agencies track it separately from renewals because it measures growth, and because commission treatment can differ between the two.

Nonrenewal

A nonrenewal is the carrier's decision not to continue a policy at the end of its term. Unlike a mid-term cancellation, it takes effect at expiration, and state law requires the carrier to send advance written notice. For the agency it means one thing: the account has to be remarketed before the expiration date, or the client goes uninsured.

NPN (National Producer Number)

An NPN, or National Producer Number, is the unique identifier assigned to every licensed insurance producer by the National Insurance Producer Registry (NIPR). It stays with you for your entire career, across states and license renewals. Carriers key appointments and commissions off it, and anyone can look one up on NIPR's public site.

Premium audit

A premium audit is the carrier's after-the-fact review of a policy whose premium was based on estimates, most commonly workers compensation and general liability rated on payroll or sales. After the policy period ends, the carrier checks the actual figures and adjusts the premium: an additional bill if exposures ran higher than estimated, a return premium if they ran lower.

Producer

A producer is a licensed salesperson at an insurance agency. Producers bring in new business: prospecting, working submissions with the service team, and closing accounts. State licensing law also uses producer as the formal term for anyone licensed to sell insurance, which is why the license itself is called a producer license.

Quote proposal

A quote proposal is the client-facing document an agency builds from carrier quotes. Where a quote is the carrier's price and terms delivered to the agent, the proposal packages one or more quotes for the buyer: premium, limits, deductibles, key exclusions, and what the agency recommends. It is how a stack of quotes becomes a decision the client can actually make.

Remarketing

Remarketing is shopping an existing client's policy to other carriers, usually at renewal. The agency gathers updated applications and loss runs, submits the risk to markets with appetite for it, and compares the results against the incumbent carrier's renewal terms.

Renewal

A renewal is the continuation of an insurance policy for another term, usually twelve months. The carrier issues renewal terms ahead of the expiration date, and the agency reviews the pricing and coverage, then either renews as offered, negotiates, or remarkets the account to other carriers.

Retention rate

Retention rate is the share of business an insurance agency keeps at renewal, usually measured over a year. Agencies track it three ways: policy retention (policies kept), client retention (accounts or households kept), and premium retention (renewal premium kept). The three can tell very different stories about the same book.

Soft market

A soft market is the phase of the insurance cycle when carriers compete for business: rates flatten or fall, underwriting loosens, and capacity is easy to find. It is the opposite of a hard market, and every line of insurance moves between the two over time.

Submission

A submission is the package an agency or broker sends a carrier's underwriter to get a quote on a commercial risk. At minimum it includes completed ACORD applications. Most also carry loss runs, supplemental applications, and a short narrative that explains the account.

Supplemental application

A supplemental application is a carrier-specific questionnaire required in addition to the standard ACORD application. Carriers use them for classes of business where the ACORD forms do not ask enough: contractors, restaurants, cyber, professional liability, and many others. A submission is not complete until every required supplemental is filled out and, usually, signed by the insured.

Surplus lines

Surplus lines insurance, also called excess and surplus or E&S, is coverage placed with non-admitted carriers: insurers not licensed in the insured's state but permitted to write risks the standard market declines. It exists for hard-to-place business: unusual operations, rough loss history, new ventures, or coverage admitted carriers simply will not offer.

Underwriting

Underwriting is how a carrier decides whether to write a risk, at what price, and on what terms. An underwriter, or an automated rating system, weighs the application, the loss history, and the carrier's appetite, then quotes, asks questions, or declines. Every submission an agency sends is competing for an underwriter's yes.

Wholesale broker

A wholesale broker is an intermediary between a retail insurance agency and carriers the agency cannot access directly, most often surplus lines markets. The retail agent keeps the client relationship. The wholesaler markets the risk to its carriers, negotiates terms, and handles the surplus lines paperwork.