What Is a Coinsurer? A coinsurer is a company that shares some of the potential liability for covering a single policyholder. The arrangement is most common when the risk or risks covered could be too costly for a single insurance company to cover. Generally, a primary insurance company covers most of the cost of a
What Is a Cost-of-Living Adjustment (COLA)? A cost-of-living adjustment (COLA) is an increase made to Social Security and Supplemental Security Income (SSI) to counteract the effects of rising prices in the economy—called inflation. COLAs are typically equal to the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for a
What Is Cold Calling? Cold calling (sometimes written with a hyphen) is the solicitation of a potential customer who had no prior interaction with a salesperson. A form of telemarketing, cold calling is one of the oldest and most common forms of marketing for salespeople. Warm calling, on the other hand, is the solicitation of a
What Is a Cold Wallet? A cold wallet is used offline for storing bitcoins or other cryptocurrencies. With a cold wallet, also originally known as cold storage, the digital wallet is stored on a platform not connected to the internet, thereby protecting the wallet from unauthorized access, cyber hacks, and other vulnerabilities that a system
What Is Company-Owned Life Insurance (COLI)? Company-owned life insurance (COLI) is a life insurance policy that pays a benefit to the company if an insured employee dies. Key Takeaways Company-owned life insurance (COLI) is a life insurance policy that pays a benefit to the company if an insured employee dies.Company-owned life insurance policies can help
What Is Collaborative Consumption? Collaborative consumption is the shared use of a good or service by a group. Whereas with normal consumption an individual pays the full cost of a good and maintains exclusive access to it, with collaborative consumption multiple people have access to a good and bear its cost. A common example is
What Is a Collar? A collar, also known as a hedge wrapper or risk-reversal, is an options strategy implemented to protect against large losses, but it also limits large gains. An investor who is already long the underlying creates a collar by buying an out-of-the-money put option while simultaneously writing an out-of-the-money call option. The put
What Is Collateral? Collateral in the financial world is a valuable asset that a borrower pledges as security for a loan. When a homebuyer obtains a mortgage, the home serves as the collateral for the loan. For a car loan, the vehicle is the collateral. A business that obtains financing from a bank may pledge
What Is Collateralization? Collateralization is the use of a valuable asset as collateral to secure a loan. If the borrower defaults on the loan, the lender may seize and sell the asset to offset their loss. For lenders, the collateralization of assets provides a level of reassurance against default risk. For borrowers with poor credit
The Collateral Source Rule: An Overview The collateral source rule is a law in state jurisdictions that prevents the reduction of damages awarded to a plaintiff for injury, illness, or disability by the amount already recovered from a third party such as an insurer. The rule varies by state but generally mandates that damages awarded
