Glossary

  • Actual cash value (ACV)
    The value of any property that is lost or damaged at the time of the loss, in contrast to Replacement Cost (RC).
  • Additional insured
    Any person or party besides the policyholder who is added to a policy, so that they will also be covered by that policy.
  • Additional living expense
    Coverage that provides a specified amount per day for additional expenses in the event that you cannot live in your insured residence.
  • Agreed value policy
    Coverage that will pay the full insured amount of the vehicle or other property in case of a covered total loss, in contrast to stated amount.
  • Appraisal
    An alternate dispute resolution, which can resolve a disagreement when the carrier and policyholder do not agree on the amount of loss.
  • Appraisal Panel
    A group of three people assigned to perform an appraisal. It includes an appraiser from each side and an umpire to resolve any differences.
  • Arson
    Intentional and malicious burning of property.
  • Building / additions / alterations coverage
    Pays for damages to additions, alterations, fixtures, improvements or installations that you make to your rented residence or condo.
  • Business Interruption Coverage
    Payments made to an insured when the business must close due to a covered loss.
  • Cancellation
    Terminating an insurance contract before the specified end-date listed in the policy.
  • Claim
    Request by a policyholder or third party from an insurance company for compensation of losses covered by insurance.
  • Claimant
    A person requesting an amount for covered losses from the insurer.
  • Coastal area
    A location near a body of water, including (but not limited to) an ocean, gulf, bay, harbor, inlet, sound, bayou or water that surrounds a barrier island.
  • Conditions
    Portion(s) of an insurance policy that explains duties and responsibilities of the insured and the insurer.
  • Condominium owners policy
    Insurance that protects the condominium and personal property of the policyholder and covers the condo owner’s personal liability for covered injuries or damage to others.
  • Construction type
    Refers to the construction of a building, such as your residence. For example, frame or masonry.
  • Continuous insurance
    When a policyholder has been insured by one or more insurance companies, without any lapse in coverage, for a specified period of time.
  • Credit card, forgery and counterfeit money coverage
    Coverage that pays for the legal obligation of an insured to pay because of theft or unauthorized use of credit cards (including Electronic Funds Transfer cards) issued to or registered in an insured’s name. This coverage also applies to forged checks and counterfeit money, but does not provide identity theft coverage.
  • Declarations page
    A page in your policy – usually the front page – with basic information that identifies the policyholder, the property or vehicles covered, the coverages and the premium amounts. In informal conversation, you may hear it referred to as the “dec” page.
  • Deductible
    The amount a policyholder agrees to pay before the insurance company covers a loss. In addition to the standard deductible, there can be different deductibles for different types of losses such as wind, hail, hurricane, earthquake, and all-peril.
  • Depreciation
    A decrease in the value of property due to wear, age or other cause.
  • Dwelling fire policy
    Coverage offered for property that is, at least partially, rented out to others.
  • Dwelling replacement cost plus/guarantee
    An optional coverage that can provide additional protection above the amount a home is insured for. It is designed to protect against unforeseen increases in the cost of repairs.
  • Endorsement
    A statement added to an insurance policy that alters, deletes or adds coverage, terms or provisions of the policy.
  • Exclusion
    A provision in an insurance policy that excludes and/or limits certain coverages.
  • Extended replacement cost
    Homeowners’ coverage that helps replace or repair personal property without depreciation being taken from the value of the property.
  • Gated community
    A housing community with controlled entry access.
  • Hazard
    A condition that creates or increases the chance that a loss will occur. For example, a wood-burning stove may increase the chance of a loss from a fire.
  • Homeowners insurance policy
    Insurance that protects the dwelling and personal property of the policyholder and covers the homeowner’s personal liability for covered injuries or damage to others.
  • Hurricane/named storm deductible
    Depending on the state of residence, if a policy includes coverage for wind and hail, a separate deductible for insuring damages caused by a hurricane or named storm may be required. Special terms, conditions and deductibles may apply in certain states.
  • Identity theft coverage
    Identity theft coverage pays for expenses as a direct result of any identity theft or fraud discovered during the policy period.
  • Indemnification
    The act of compensating for a loss.
  • Insurer
    The company that provides insurance coverage and services on a policy.
  • Insurable interest
    A consideration of value that is insured under a policy. A person with insurable interest will suffer a genuine hardship if a loss should occur to the person or property they’ve insured. For instance, people have an insurable interest in their own lives and property, but generally do not have insurable interest in their neighbor’s life or property. Insurable interest must be present in order for an insurance contract to be legal and valid.
  • Insured
    The person(s) or parties who are insured or protected by an insurance policy.
  • Lapse
    A period of time when someone goes without insurance coverage.
  • Lease
    A contract granting use or occupation of property during a specified period, in exchange for a specified rent.
  • Leaseholder
    An individual who possesses or has use of property through a lease.
  • Lessee
    An individual to whom a lease is granted.
  • Liability coverage
    Coverage for bodily injury or property damage to others for which you are held liable (as provided by your policy and state law).
  • Lien
    A creditor’s claim against an owner’s assets to secure an unpaid debt.
  • Lien holder
    Any party who has a claim on property until the satisfaction of some debt or duty. For example, a bank is the lien holder of a house until the mortggage is paid off by the owner.
  • Limits of insurance
    The amount an insurance company will pay for a covered loss, as stated in the policy.
  • Loss
    Direct and accidental damage to an insured property, which is the basis for filing a claim.
  • Loss assessment coverage
    Coverage providing reimbursement for extra fees assessed by a condominium or homeowners association. It is subject to a deductible and the limit stated in the policy.
  • Loss history
    A history of a person’s property losses.
  • Loss of use
    Coverage that pays additional expenses when a policyholder has to move out of their residence while repairs are made, as a result of damage caused by a covered loss.
  • Malicious mischief
    Deliberate damage or destruction of another person’s property. For insurance purposes, it is typically covered under vandalism.
  • Misrepresentation
    False or misleading statements.
  • Market value
    The value of property in terms of what it can be sold for in the open market.
  • Medical payments to others
    This coverage may provide payment for medical expenses resulting from an accident on your property. “Med pay” is intended for the immediate medical treatment of guests on your premises, without determining fault. This coverage is subject to specific dollar limits per incident, and availability may vary.
  • Misrepresentation
    False or misleading statements.
  • Mitigation
    Steps taken to prevent or reduce the amount or likelihood of loss.
  • Named insured
    The person or entity specifically identified as the named insured in an insurance policy. This person is also referred to as the policyholder.
  • Named perils
    Covered perils that are listed in an insurance policy. Also known as specified perils.
  • Occupancy
    The number of people living in the property.
  • Ordinance or law coverage
    Coverage providing increased cost to a covered loss resulting from an ordinance or law.
  • Other structure
    A structure located on the residence premises that is not directly attached to the dwelling structure, such as a detached garage or gazebo. It may be insured under a homeowners policy.
  • Personal injury
    Provides coverage for the personal injury to others, such as false arrest, libel (written), slander (verbal), or invasion of privacy.
  • Personal property
    All other property not classified as real property, and which is easily moved. This includes furniture, clothing and household goods. Also known as Contents.
  • Personal Umbrella Policy
    An extra layer of liability protection for your assets if there’s a serious auto accident or accident on your property and damages exceed the limits of your auto or homeowners coverage limits.
  • Physical damage
    Visual damage to a policyholder’s property.
  • Policy
    A written contract of insurance.
  • Policyholder
    The person or entity specifically identified as the named insured in an insurance policy. This person is also referred to as the named insured.
  • Premium
    The amount of money an insurance company charges in return for providing coverage.
  • Property
    Anything that has value. There are two types: real property and personal property.
  • Property fire wall
    A physical wall with qualities of fire resistance and structural stability. It controls the spread of a fire.
  • Protective devices
    Safety equipment designed to prevent, protect or notify you in the event of an emergency, such as fire extinguishers, dead-bolt locks, fire alarms, smoke alarms and burglar alarms.
  • Public Adjuster
    A licensed insurance adjuster hired to represent the insured’s interests during a property insurance claim.
  • Real property
    Land and the permanent things on it, such as buildings, outdoor fixtures, machinery and equipment.
  • Renters Policy
    An insurance policy that covers a tenant and some of their personal possessions. Also known as Tenants Policy.
  • Replacement cost (RC)
    The actual cost of replacing damaged or destroyed property with new property, in contrast to Actual Cash Value (ACV).
  • Residence premises
    The physical location of the property for which insurance protection is provided. This is also known as the insured location.
  • Scheduled Personal Property
    Additional optional insurance coverage for high-value appraised personal property that can be added to a homeowners, renters or condo policy. This can include jewelry, furs, or cameras.
  • Supplemental heating device
    A fuel-burning appliance used as secondary heating source. Includes wood, coal and pellet stoves, cook stoves, freestanding stoves, freestanding fireplaces and fireplaces with inserts. To be insured, all units must have a separate flue, instead of sharing the flue of the primary heat source. A small, portable space heating unit is not considered a supplemental heating device.
  • Water backup of sewers or drains coverage
    Optional coverage for loss due to water backup through sewers or drains.
  • Wind/hurricane deductible
    A separate deductible that applies only to covered wind or hurricane losses.
  • Windstorm or hail coverage
    Coverage for losses as a result of windstorm or hail. This coverage may be subject to special terms, conditions and deductibles. On some policies, these perils may be excluded entirely.