Whenever personnel or facilities are used in common by two or more companies, or whenever the personnel or facilities of one company are used in the activities of two or more companies, the expenses involved shall be apportioned in accordance with the regulations relating to Joint Expenses, and such apportioned expenses shall be allocated by each company to the same operating expense classifications as if the expenses had been borne wholly. Any difference between the actual amount paid, and the amount of such apportioned expenses shall be included in the operating expense classification “Miscellaneous".
This instruction does not apply to the allocation of the following, which are covered by separate instructions herein:
Reinsurance commission and allowances (see Commission and Brokerage-Reinsurance Assumed and Ceded).
Commission and brokerage paid to managers and agents (see Commission and Brokerage-Direct).
Allowances to managers and agents (see Allowances to Managers and Agents).
Expenses allocable in accordance with the instruction “Income from Special Services".
Whenever expenses are paid by one company for account of another, the payments shall not appear among the expenses reported by the former, and shall be included by the latter in the same expense classifications as if originally paid by it.
Whenever an insurance company receives compensation for sales or services, such as loss adjustment or inspection not related to policies written by the company, and such compensation is not calculated as a joint expense reimbursement, the amount thereof shall be included in the operating expense classification “Miscellaneous". Where an insurance company pays the compensation, allocation shall be made to the expense classification dictated by the nature of the expense.
This instruction is of limited applicability and does not apply to the allocation of the following, which are covered by separate instructions herein:
Reinsurance commission and allowances (see Commission and Brokerage-Reinsurance Assumed and Ceded).
Expenses incurred for the benefit of companies in the same group or fleet. Such expenses are covered by the instruction “Joint Expenses".
The lists of expenses includable in the operating expense classifications are representative and do not exclude analogous items which are omitted from the lists.
Ins 6.30 Note
The references are to subparagraphs in paragraph (b) of subsection (1).
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Accident and loss prevention billed specifically — 6
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Accident and loss prevention literature — 6
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Accident and loss prevention organizations — 5
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Accident insurance for employees — 9-a
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Accounting societies, dues and subscriptions to — 12
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Actuarial societies, dues and subscriptions to — 12
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Adding machine tape — 15
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Adjusters — 1-a
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Adjustment services — 1
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Advertising, operating expense classification — 4
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Advertising, help wanted — 9-b
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Advertising in connection with owned real estate — 19
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Advertising required by law when only the minimum space required by law is taken — 18-d
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Advertising required by law when more than the minimum space required by law is taken — 4
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Advisory organizations — 5
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Agents' allowances, reimbursements and payments computed as percentage of premiums — 2-a
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Agents' allowances, reimbursements and payments not computed as percentage of premiums — 3
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Agents' licenses — 18-b
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Allocated loss adjustment expenses — 1-a
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Allowances to managers and agents, operating expense classification — 3
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Alterations and repairs of leased premises — 13
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Analogous items — 22-d
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Analysis pads — 15
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Appeal costs relating to claim adjustment — 1-a
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Appraisals relating to claim adjustment — 1-a
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Assessments for fire patrol — 18-a
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Assessments of boards, bureaus and associations — 5
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Associations, underwriting — 5
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Attorneys' fees relating to claim adjustment — 1-a
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Attorneys' fees — 17
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Audit bureaus — 5
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Audit of assureds' records, operating expense classification — 7
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Auditing relating to claim adjustment — 1-a
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Auditing fees of independent auditors for auditing payrolls and other premium bases — 7
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Auditing fees of independent auditors for examining records of home and branch offices — 17
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Automobiles, depreciation, rent, repairs and expenses of — 12; insurance of — 10
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Automobile license plates — 12
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Bank charges for collection and exchange — 16
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Billboards — 4
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Binders and posts — 15
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Board allowances, reinsurance — 2-b, 2-c
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Boards, bureaus and associations, operating expense classification — 5
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Bonds covering employees — 10
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Bonds, premium cost, relating to claim adjustment — 1-a
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Bonus to employees — 8
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Booklets for accident and loss prevention — 6
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Books, newspapers and periodicals including investment, tax and legal publications and services — 15
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Branch office rent — 13
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Broadcasts — 4
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Brokerage to employees when the activities for which the commissions are paid are not a part of their duties as employees — 2-a
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Brokerage to employees when the activities for which the commissions are paid are a part of their duties as employees — 8
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Brokerage, direct — 2-a
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Brokerage, reinsurance assumed — 2-b
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Brokerage, reinsurance ceded — 2-c
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Brokers' allowances, reimbursements and payments computed as a percentage of premiums — 2-a
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Brokers' allowances, reimbursements and payments not computed as a percentage of premiums — 3
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Bureaus — 5
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Burglary and robbery insurance premiums — 10
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Business licenses — 18-a, 18-b, and 18-d
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Cables — 16
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Calendars for advertising purposes — 4
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Capital stock taxes — 18-d
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Carbon paper — 15
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Cartage, express and freight — 16
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Catering for employees — 9-b
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Certificates of compliance — 18-b
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Charges for claim adjustment services of underwriting pools, syndicates and
associations — 1-a
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Character or credit reports relating to claim adjustment — 1-a
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Character reports for underwriting purposes — 6
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Character reports on employees — 9-b
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Charities, contributions to — 21
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Circulars, advertising in — 4
