LOMA Glossary

The LOMA Glossary of Insurance and Financial Services Terms

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QPP. See Quebec Pension Plan.

qualified annuity. An annuity that qualifies to receive favorable tax treatment and is purchased to either fund or distribute funds from a qualified retirement plan in the United States.

qualified beneficiary. In the United States under the Consolidated Omnibus Budget Reconciliation Act, a specified individual who has the right to continue group medical expense insurance coverage for a limited time following a qualifying event without providing evidence of insurability.

qualified retirement plan. A group retirement plan that receives favorable federal income tax treatment in the United States because it meets specified requirements imposed by the federal tax laws and the Employee Retirement Income Security Act. See also registered pension plan.

qualifying. The process by which a producer screens prospects to separate those with real buying potential from those with poor potential.

qualifying event. In the United States under the Consolidated Omnibus Budget Reconciliation Act, a specified situation in which a person whose group medical expense insurance would otherwise terminate is allowed to continue the group insurance coverage for a limited time.

quality business. See well-written business.

quality rating. An alphabetical grade or rating assigned to an insurance company by a rating agency to indicate the level of the insurance company’s financial strength, its ability to pay its obligations to customers, or its ability to pay its obligations to creditors.

Quebec Pension Plan (QPP). In the Canadian province of Quebec, a compulsory. contributory public insurance plan that provides wage earners in Québec and their families with basic financial protection in the event of retirement, death or disability.

quick liquidity ratio. For insurers, the ratio of an insurer’s liquid assets to its contractual reserves. See also ratio.

quick ratio. One way of determining a company’s ability to liquidate debt immediately, this ratio is calculated by dividing a company’s most liquid current assets by the company’s current liabilities. Also known as acid-test ratio.

quota share. Generally, an insurance company’s percentage share of a reinsurance transaction. Also known as a subscription.

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