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NAIC Accreditation System. A voluntary program designed by the National Association of Insurance Commissioners in which a review team certifies that a particular state insurance department has met certain standards established by the NAIC. This program is part of a larger-scale effort by the NAIC to respond to critics of state regulation and to forestall federal regulation.

Naïve Capacity. A term describing insurers that enter the insurance marketplace without appropriate knowledge of the risks inherent in the business, thereby contributing to an excess of available capital and a soft insurance market; also known as innocent capacity.

Name. An alternative term for an underwriting member of Lloyd's. Underwriting members are individuals or organizations that provide capital (the "capital providers") to Lloyd's syndicates. Severally liable for all underwriting results of a syndicate on an unlimited basis.

Named Insured. The insured specifically referred to in an insurance policy as one enjoying protection under the policy.

Named Perils. The perils specifically referred to in an insurance policy as those covered by the policy.

National Association of Independent Insurers (NAII). A Des Plaines, Illinois-based trade organization representing primarily the smaller property-casualty insurers.

National Association of Insurance Brokers (NAIB). A Washington, DC-based trade organization representing insurance brokers.

National Association of Insurance Commissioners (NAIC). A Kansas City, Missouri-based organization of state insurance commissioners founded in 1871 to study insurance regulatory affairs and assist state insurance departments in carrying out their regulatory responsibilities.

National Association of Life Companies (NALC). A Washington, DC-based trade organization that represented primarily the smaller life insurers. This organization was merged with the American Council of Life Insurance in 1992.

National Association of Mutual Insurance Companies (NAMIC). An Indianapolis, Indiana-based trade organization representing mutual property-casualty insurers.

National Association of Professional Insurance Agents (PIA). An Alexandria, Virginia-based trade organization representing independent insurance agents.

National Association of Surety Bond Producers (NASBP). A Washington, DC-based trade organization representing surety bond producers.

National Committee for Quality Assurance (NCQA). A national nonprofit organization created to develop and monitor health care provider quality measurements and standards.

National Council on Compensation Insurance (NCCI). A Boca Raton, Florida-based organization that develops and administers rating plans and systems for workers' compensation insurance.

National Flood Insurance Program. A program created by federal legislation and administered by the Federal Insurance Administration to provide flood insurance at subsidized rates to those who reside in designated flood areas. In 1983, participation in the program was opened to private insurers through the "Write Your Own" program.

Natural Death. Death by means other than accident or war.

Negligence. The failure to act as a prudent and reasonable person would under similar circumstances.

Net Line. See Retention.

Net Premiums Earned (NPE). An insurer's premiums recorded as earned in a specific period, net of premiums assumed and ceded.

Net Premiums Written (NPW). An insurer's premiums recorded as written in a specific period, net of premiums assumed and ceded. The difference between written premiums and earned premiums is amortization. For example, a one-year policy written in November has its premium recorded as written entirely in that year, while 1/12 of the premium is earned each month over the period insured.

Network. An organized groups of physicians, hospitals and other health care providers working with a health plan to offer care at negotiated rates (lower than their usual charges) in return for patient flow. Network-based products are central to managed care. Examples are HMOs, PPOs and POS plans.

Network Model HMO. A health plan that contracts with multiple physician groups to deliver health care to members. Generally limited to large single or multispecialty groups.

Network Provider. Physicians, hospitals or other providers of medical services that have agreed to participate in a network, to offer their services at negotiated rates and to meet other contractual provisions. Also known as a "participating provider."

New York Insurance Exchange. A marketplace established in 1980 to underwrite reinsurance and large or unusual insurance risks. It ceased operation in December, 1991.

"No Fault" Insurance. A system in which an injured person receives benefits from an insurer without having to establish fault.

Nonadmitted Assets. Assets of an insurer that are not permitted by insurance regulatory authorities to be taken into account in determining the insurer's financial condition under statutory accounting practices.

Nonadmitted Insurance. Insurance written by a nonadmitted insurer.

Nonadmitted Insurer. An insurer not licensed to write insurance within a given state.

Nonadmitted Reinsurance. Reinsurance written by a reinsurer not licensed or authorized to transact business within a given state. Unless the ceding company holds a letter of credit or other appropriate security for such reinsurance, such reinsurance is not considered as an admitted asset for purposes of the cedant's annual statement.

Nonadmitted Reinsurer. A reinsurer not licensed or approved to do business in a particular jurisdiction.

Noncontributory Plan. A group plan or health policy in which the employer pays the entire premium. Such a plan is referred to as "noncontributory" because the beneficiaries are not required to contribute to the payment of premiums.

Non-Investment-Grade Securities. For insurers, fixed-income securities held in an insurer's investment portfolio with a Class (3) or lower rating by the Securities Valuation Office of the National Association of Insurance Commissioners.

Nonparticipating Policy. A policy that does not entitle a policyholder to receive dividends from the surplus of an insurer.

Nonproportional Reinsurance. See Excess-of-Loss Reinsurance.

Nonqualified Tax Annuity. An annuity that does not comply with the requirements of a tax-qualified retirement plan. Premiums and deposits are made with after-tax dollars.

Nonstandard Automobile Insurer. An insurer specializing in insuring drivers who have a record of traffic accidents or violations or who have been canceled or refused insurance.

Nonstandard Risk. A policyholder with above-average loss experience and higher-than-average loss frequency potential. This term is used most often with reference to purchasers of automobile insurance.

NPE. See Net Premiums Earned.

NPW. See Net Premiums Written.

Nuclear Insurance Pools. This term refers to special insurance pools created by property-casualty insurers to cover losses resulting from nuclear accidents. Among the pools in existence are American Nuclear Insurers (ANI), the Mutual Atomic Energy Research Pool (MAERP) and the Mutual Atomic Energy Liability Underwriters (MAELU). See also Price-Anderson Act.