Insurance Glossary - insuretechkit.com

Actual Cash Value (ACV)

A property-loss valuation method that generally starts with the cost to repair or replace damaged property and subtracts depreciation. The exact calculation and what property it applies to depend on the policy and applicable law.

Also called: ACV

Additional Living Expenses (ALE)

Coverage that may pay the necessary increase in living costs when a covered loss makes a home or rental temporarily unlivable. It usually covers extra costs above normal spending, subject to the policy’s limits, time restrictions, and documentation requirements.

Also called: ALE; additional living expense

Adjuster

A person who investigates an insurance claim, reviews the policy and damage information, and evaluates the amount of loss. An adjuster may work for an insurer, as an independent contractor for an insurer, or for the policyholder as a public adjuster.

Also called: claims adjuster

Appraisal

A process used to estimate the value of property or, in some policies, to address a disagreement about the amount of a covered loss. An insurance appraisal provision usually does not decide whether the policy covers the loss unless the policy or applicable law says otherwise.

Association Master Policy

The insurance policy purchased by a condominium or homeowners association for shared buildings, common areas, and other association responsibilities. The boundary between this policy and a unit owner’s HO-6 policy is controlled by the master policy, governing documents, and applicable law.

Also called: community master policy; HOA master policy

Bodily Injury

Physical injury, sickness, or disease suffered by a person. Liability policies use the term in defined ways, so the policy’s own definition controls whether a particular harm falls within coverage.

Bodily Injury Liability

Coverage that may pay damages for bodily injury or death the insured is legally responsible for causing to other people, subject to the policy limit, exclusions, and state law.

Cancellation

Termination of an insurance policy before its scheduled expiration date. Notice requirements, permitted reasons, and refund rules vary by policy type and state law.

Catastrophe Deductible

A deductible that applies only when a defined catastrophe-related trigger is met, such as a hurricane, named storm, earthquake, or wind event. It may be stated as a dollar amount or a percentage, and the policy wording determines when it applies.

Claim Log

A personal record of claim communications, dates, names, documents, expenses, and next steps. It is not an insurer form, but regulators commonly encourage keeping one to help track the process and preserve a clear record.

Also called: claim diary

Claim Number

The identifier an insurer assigns to a reported claim. It helps the insurer and policyholder connect calls, documents, estimates, and payments to the same claim file.

Also called: claim reference number

Collision Coverage

Optional physical-damage coverage that commonly pays for covered damage to the insured vehicle after a collision with another vehicle or object, or a rollover, minus the deductible and subject to valuation and exclusions.

Combined Single Limit

A liability-limit structure that provides one maximum amount for covered bodily injury and property damage arising from one accident, rather than separate split limits.

Company Adjuster

An adjuster who works for or on behalf of the insurance company when evaluating a claim. The company adjuster does not represent the policyholder’s interests in the way a public adjuster does.

Also called: insurer adjuster

Comprehensive Coverage

Optional physical-damage coverage, often called other-than-collision coverage, that commonly responds to listed non-collision causes such as theft, fire, weather, vandalism, glass damage, or animal impact, subject to the policy.

Condo Unit-Owners Policy (HO-6)

A policy designed for a condominium unit owner. It commonly addresses the parts of the unit not covered by the association master policy, personal belongings, loss of use, personal liability, medical payments, and loss assessment, subject to the policy and governing documents.

Also called: HO-6; unit-owner policy

Coverage

The protection or benefit provided by an insurance policy for specified people, property, events, or liabilities. Coverage exists only within the policy’s definitions, conditions, limits, deductibles, and exclusions.

Coverage Limit

The maximum amount of insurance available under a particular coverage, subject to the policy’s terms. A limit is not a promise that every claim will be paid up to that amount.

Also called: limit of liability; policy limit

Covered Loss

A loss that falls within the policy’s insuring agreement and is not removed or restricted by an exclusion, condition, limit, or endorsement. Whether a loss is covered depends on the facts and the full policy wording.

Also called: covered claim

Declarations Page

The summary section of an insurance policy that identifies key details such as the named insured, covered property, policy period, coverage limits, deductibles, premium, and listed forms or endorsements. It does not replace the full policy.

Also called: declaration page; dec page; declarations sheet

Deductible

The portion of a covered loss the policyholder is responsible for before or as part of the insurer’s payment calculation. A deductible may be a fixed dollar amount or a percentage and may vary by coverage or cause of loss.

Depreciation

A reduction in value associated with age, wear, condition, or obsolescence. Depreciation is commonly part of actual-cash-value calculations, but the method and recoverability depend on the policy and law.

Dwelling Coverage

The part of a homeowners policy that generally covers the insured home’s structure and attached components, subject to covered causes of loss, limits, deductibles, and exclusions. The declarations page may identify it as Coverage A.

Also called: Coverage A

Effective Date

The date and time an insurance policy or change begins to provide coverage, subject to the contract. It should be reviewed together with the expiration date to identify the policy period.

Also called: policy start date

Endorsement

A document that adds, removes, excludes, or changes terms in an existing insurance policy. An endorsement becomes part of the policy and may take precedence over conflicting language in the base form.

Also called: rider; amendment

Exclusion

Policy language that removes or limits coverage for a specified cause of loss, property, person, activity, or circumstance. Exclusions can appear in the base policy or in an endorsement.

Expiration Date

The date and time a policy period ends unless the policy is renewed or replaced. Coverage gaps can occur when a new policy’s effective date does not immediately follow the old policy’s expiration.

Also called: policy end date

Flood Insurance

Separate insurance designed to cover defined flood losses. Standard homeowners and renters policies commonly exclude flood, and the precise flood definition and coverage rules depend on the flood policy.

GAP Insurance

A separate coverage or contract that may pay an eligible difference between a vehicle’s covered total-loss value and a qualifying loan or lease balance, subject to caps, exclusions, cancellation rules, and contract terms.

Home Inventory

An organized record of personal belongings, often including descriptions, photographs, serial numbers, approximate purchase information, and value evidence. It can help with coverage reviews and claim documentation.

Also called: personal property inventory

Homeowners Insurance

A package policy that combines property and liability coverages for an owner-occupied home. The form, covered causes of loss, limits, deductibles, exclusions, and optional coverages vary by insurer, state, and policy.

Also called: home insurance

Hurricane Deductible

A separate deductible that applies when the policy’s defined hurricane trigger is met. The trigger, amount, duration, and whether it is percentage-based vary by policy and state.

Insurance Agent

A licensed person or business that sells or services insurance policies on behalf of one or more insurers. The agent’s role and authority can vary, so policyholders should confirm whether a request or change has actually been accepted by the insurer.

Also called: agent

Insurance Claim

A request for an insurer to evaluate a loss or event under an insurance policy. Filing a claim does not guarantee coverage or payment; the insurer applies the policy terms, facts, limits, deductibles, and exclusions.

Insurance Policy

The contract that sets out the insurer’s promise, the insured’s duties, definitions, limits, deductibles, exclusions, conditions, and endorsements. The declarations page is only a summary of this contract.

Also called: insurance contract

Insured

A person or entity protected under an insurance policy. A policy may distinguish between the named insured and other people who qualify as insureds under its definitions.

Insurer

The insurance company that issues the policy and assumes covered risk in exchange for premium. The insurer evaluates claims according to the policy and applicable law.

Also called: insurance carrier; insurance company

Insuring Agreement

The section of a policy that states the insurer’s basic promise of coverage and identifies the general scope of protection. Definitions, exclusions, conditions, endorsements, limits, and deductibles modify how that promise applies.

Liability Coverage

Coverage that may pay covered damages and defense costs when an insured is legally responsible for bodily injury or property damage to another person. The policy’s exclusions and liability limit control the protection available.

Also called: personal liability coverage

Liability Limit

The maximum amount the insurer will pay under a liability coverage, subject to the policy’s terms. Some policies use separate per-person, per-occurrence, or aggregate limits.

Also called: limit of liability

Loss

Physical damage, destruction, theft, bodily injury, or another event that may give rise to a claim. A loss is not necessarily covered merely because it occurred.

Loss Assessment Coverage

Coverage in some condo unit-owner policies that may pay the insured unit owner’s share of a qualifying assessment charged by the association after a covered loss. Coverage depends on the cause, policy language, limits, deductible, and governing documents.

Loss of Use

Coverage that may pay additional living expenses or other specified costs when a covered loss prevents normal use of the insured home. The policy determines which expenses qualify and for how long.

Also called: Coverage D

Medical Payments to Others

A limited coverage that may pay certain medical expenses when another person is accidentally injured on or in connection with the insured property, often without requiring a liability judgment. It is subject to exclusions and a separate limit.

Also called: medical payments coverage

Mortgagee

The lender or other party with a financial interest in mortgaged property. A mortgagee may be listed on the declarations page and may have rights under a mortgage clause when insured property is damaged.

Also called: lienholder

Named Insured

The person or entity specifically identified by name on the declarations page as an insured. The policy may extend some protections to other people, but the named insured usually has primary contractual duties and rights.

Named Peril

A cause of loss covered only when it is specifically listed in the policy. If a policy covers personal property on a named-peril basis, an unlisted cause of loss is generally outside that grant of coverage.

Also called: specified peril

No-Fault Insurance

A state-law auto insurance system in which specified first-party injury benefits are generally claimed from a person’s own insurer without first proving another driver was at fault. Rules and lawsuit thresholds vary by state.

Occurrence

An event or series of related events that the policy treats as one liability incident. The policy definition matters because it can affect which limit, deductible, or policy period applies.

Open Peril

A coverage approach that generally covers direct physical loss unless the cause is excluded or limited. The phrase is sometimes called “all risk,” but it does not mean every possible loss is covered.

Also called: all-risk coverage; special form

Other Structures Coverage

The part of a homeowners policy that may cover detached structures on the insured premises, such as a detached garage, shed, or fence. The applicable limit, covered causes of loss, and exclusions depend on the policy.

Also called: Coverage B

Peril

The cause of a property loss, such as fire, theft, wind, or another event described by the policy. Policies may grant coverage using named-peril or open-peril language.

Also called: cause of loss

Personal Injury Protection (PIP)

Auto coverage that may pay specified injury-related expenses for eligible insured people without first deciding fault. Required benefits, limits, availability, and rejection rules vary by state.

Personal Property Coverage

Coverage for belongings such as furniture, clothing, electronics, and other household contents, subject to covered causes of loss, limits, deductibles, exclusions, and special limits. It may be identified as Coverage C.

Also called: contents coverage; Coverage C

Policy Limit

The maximum amount an insurer may pay under a particular coverage or for a defined loss period, subject to the policy’s terms, sublimits, exclusions, deductibles, and applicable law.

Policy Period

The span of time between the policy’s effective date and expiration date during which coverage may apply, subject to the contract. Claims can involve additional timing rules, so the date of loss should be compared with the complete policy.

Also called: coverage term

Premium

The amount charged for insurance coverage for a stated policy period. Discounts, surcharges, taxes, fees, payment plans, and policy changes can affect the amount shown.

Proof of Loss

A formal statement submitted to an insurer describing a claimed loss and supporting information. The policy or insurer may require a signed form by a specified deadline, so the request and instructions should be read carefully.

Property Damage

Physical injury to, destruction of, or loss of use of tangible property, as defined by the liability policy. The policy’s definition and exclusions control whether a particular event qualifies.

Property Damage Liability

Coverage that may pay for damage the insured is legally responsible for causing to another person’s vehicle or other property, subject to the policy limit and terms.

Public Adjuster

A licensed adjuster hired and paid by a policyholder to assist with evaluating or negotiating a property insurance claim. Licensing, contracts, fees, and permitted activities are governed by state law.

Renters Insurance

A policy for a tenant that commonly includes personal property, personal liability, medical payments, and loss-of-use coverage. It generally does not insure the landlord’s building structure.

Also called: tenant insurance

Replacement Cost

The cost to repair or replace damaged property with property of like kind and quality without deducting for depreciation, subject to the policy’s terms. Some policies initially pay actual cash value and release additional replacement-cost benefits after repair or replacement requirements are met.

Also called: replacement cost value; RCV

Scheduled Personal Property

Coverage that lists and insures a specific valuable item or category under an endorsement or separate schedule. The item description, value basis, covered causes of loss, deductible, and documentation requirements depend on the form.

Also called: floater; scheduled property endorsement

Special Limit (Sublimit)

A smaller limit that applies to a particular type of property, loss, or expense within a broader coverage limit. Jewelry, money, business property, or certain causes of loss may have special limits, depending on the policy.

Also called: sublimit; special limit of liability

Split-Limit Coverage

A liability-limit structure that states separate maximums, commonly for bodily injury to one person, bodily injury to all people in one accident, and property damage in one accident.

Supplemental Claim

Additional claim information submitted after the initial estimate or payment when more covered damage or cost is identified. Procedures and deadlines vary by policy and state, so newly discovered damage should be reported promptly.

Also called: claim supplement; supplemental damage

Temporary Repairs

Reasonable short-term measures taken to protect property from additional damage after a loss, such as covering an opening or stopping a leak when safe. Receipts and photographs should be kept, and permanent repairs may need to wait for insurer inspection or instructions.

Also called: emergency repairs

UM/UIM Stacking

The combining of uninsured or underinsured motorist limits from more than one covered vehicle or policy when state law and policy terms permit it. Some states restrict, waive, or prohibit stacking.

Underinsured Motorist Coverage

Auto coverage that may provide an additional covered payment when the responsible driver’s available liability insurance does not fully compensate covered damages, subject to state calculation rules, offsets, limits, and policy conditions.

Uninsured Motorist Coverage

Auto coverage that may pay covered damages when a person qualifying as an insured is harmed by a driver with no applicable liability insurance or, under some state and policy rules, an unidentified hit-and-run driver.

Wind/Hail Deductible

A separate deductible that may apply to covered damage caused by wind or hail. It can be a fixed dollar amount or a percentage and may apply under different triggers from a hurricane or named-storm deductible.

Also called: windstorm deductible

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