Glossary of Insurance Terms

U

Umbrella liability - A liability contract with high limits covering over top of primary liability coverages and, subject to a self-insured retention (deductible), covering exposures otherwise uninsured.

Underground Storage Tank (UST) - Tanks sunk in the ground that are used to store or dispose of gasoline or other fuels, hazardous chemicals, or other pollutants or contaminants.

Underinsured motorists coverage - Coverage for the insured and passengers whenever the at-fault driver in an accident has auto liability insurance with lesser limits than the insured’s. This coverage lies atop "uninsured motorists coverage" or atop the at-fault driver’s low limit automobile liability insurance and provides the insured and passengers with protection equal (usually) to the insured’s own automobile liability cover.

Underlying insurance policy - The policy providing initial coverage for a claim until its limit of liability is reached and an umbrella or excess policy’s coverage is triggered.

Underlying limits - The limits of liability of the policy(ies) underlying an umbrella or excess policy.

Underwriter - One who researches and then accepts, rejects, or limits prospective risks for an insurance company.

Underwriters Laboratories, Inc. (UL) - Originally begun as a cooperative of western fire insurers to test materials, the UL is now an independent organization testing virtually every fabricated device and material. Items are permitted to bear the UL seal of approval only after they have passed stringent testing for safety.

Unearned premium - That portion of an insurance premium that would have to be returned to the insured if the policy were cancelled.

Unilateral contract - A contract such as an insurance policy in which only one party to the contract, the insurer, makes any enforceable promise. The insured does not make a promise but pays a premium, which constitutes his part of the consideration.

Uninsurable risk - An uninsurable risk is one that is literally uninsurable because loss is certain rather than possible.

Uninsured motorists coverage - Coverage for the insured and passengers whenever the at-fault driver in an accident has no auto liability insurance. Coverage is usually to the extent of limits required by state auto financial responsibility laws.

United States Longshore and Harbor Workers Compensation Act (USL&H) - A compulsory law administered by the Department of Labor that covers injuries to employees on vessels or drydocks.

Unsatisifed judgment fund (UJF) - In some states a person who is injured in an automobile accident and who cannot collect from the person responsible, may collect from a special fund (UJF).