Actual Cash Value: It is the cost to replace lost or damaged assets. To determine the actual cash value you would subtract any depreciation from the replacement cost of the item.
Additional Living Expenses: Insurance company payments to the policy holder when the insured requires temporary shelter due to damages making the home uninhabitable.
Adjuster: An individual employed by an insurer to evaluate losses and settle policyholder claims. Public Adjusters: Independent contractors who adjust claims for different insurance companies.
Agency: Principles and regulations that govern the actions of any agent representing a principal.
Agent: A state-licensed professional who represents the insurance company and providing fair advice to meet the needs of the insured.
All Risk Policy: Insurance policy that protects the insured from losses caused by any peril not specifically excluded by the policy.
Allied Lines: Property insurance that is usually bought alongside fire insurance; it includes wind, water damage, and vandalism coverage.
Appraisal: A estimate to determine a propertys insurable value or the amount of a loss.
Arbitration: Procedure in which an insurance company and the insured agree to settle a claim dispute by accepting a binding decision made by a third party.
Binder: They are generally issued to provide short term and temporary coverage when a new policy has been bought or substantially changed. It is good until the insurance company policy is accepted or denied. Boiler and Machinary Insurance: Often called Equipment Breakdown, or Systems Breakdown insurance. Commercial insurance that covers damage caused by the malfunction or breakdown of a vast array of equipment.
Burglary and Theft Insurance: Insurance for the loss of property due to burglary, robbery or larceny. It is provided in a standard homeowners policy and in a business multiple peril policy.
Business Interruption: Commercial coverage that reimburses a business owner for lost profits and continuing fixed expenses during the time that a business must stay closed because of physical damage from a covered peril. It provides coverage that acts as a bridge to keep the business viable during times when the business cannot operate.
Businessowners Policy/BOP: A policy that combines property, liability and business interruption coverages for small- to medium-sized businesses.
California Earthquake Authority: A state-sponsored partnership between private companies and the government offering earthquake insurance policies in the state.
Casualty Insurance: Covers losses caused by injuries to persons and legal liability incurred by the insured. It protects you if someone gets hurt while using your product or service or is injured while on your property. Various Types: plate glass, insurance against robbery, burglary and forgery, boiler and machinery insurance and aviation insurance.
Chartered Property and Casualty Underwriter: Professional designation given by the American Institute for Property and Liability Underwriters. The designation indicates expertise in insurance, risk management, economics, finance, management, accounting, and law.
Claim: A form filed by the insured for payment due to damages or losses covered by the insurance policy.
COBRA Benefits: COBRA requires companies with 20 or more employees to offer separating employees the option to continue their group health-care coverage at their own expense.
Commercial General Liability Insurance: Broad commercial policy that covers all liability exposure not specifically excluded. Coverage includes product liability, the premises and operations, and independent contractors.
Commercial Lines: Products designed for businesses. Major coverages are boiler and machinery, business interruption, commercial auto, comprehensive general liability, directors and officers liability, fire and allied lines, inland marine, medical malpractice liability, product liability, professional liability, surety and fidelity, and workers compensation.
Common Policy Declarations: A form included in the Commercial Package Policy. It contains information about the insured as it applies to all coverages issued.
Cost of Living Adjustment: periodic increases in wages or benefits to compensate for the effects of inflation.
Credit Insurance: Commercial coverage against losses resulting from the failure of business debtors to pay debts due to insolvency. The coverage is geared to manufacturers, wholesalers, and service providers.
Dependent Property: A business interruption endorsement that protects you from financial losses caused by problems not located on your premises, but elsewhere. Dependent property is property not owned, operated or controlled by you but which you are dependent on for normal business operations.
Destroyed or Damaged Records: This insurance will compensate you a loss of income caused by lost or damaged records due to a covered risk.
Directors and Officers Liability Insurance: Covers directors and officers of a company for negligent acts or omissions, and for misleading statements that result in suits against the company.
Economic Loss: Total financial loss resulting from the death or disability of a wage earner, or from the destruction of property. Includes the loss of earnings, medical expenses, funeral expenses, the cost of restoring or replacing property, and legal expenses.
Earthquake Coverage: Is available as additional coverage to standard commercial property and casualty policies. Earthquake coverage is relatively expensive for masonry or brick structures or business's with high-risk inventory or equipment.
Employee Dishonesty Coverage: Covers direct losses and damage to businesses resulting from the dishonest acts of employees
Employers Liability Insurance: Coverage against liability of an employer for accidents to employees, such as tripping in an office. This is not the same as as the liability imposed by a workers' compensation law.
Errors and Omissions: Often referred to as E&O, these policies protect professionals for errors in judgment or omissions that materially affect a clients decision.
Employment Practices: This kind of coverage will help defend against employment-related claims such as sexual harassment, age discrimination, or wrongful termination. Some policies offer legal assistance.
Environmennt Impairment Liability: A form of insurance designed to cover losses and liabilities arising from damage to property caused by pollution.
Exclusions: Insurance companies may define certain people, situations or perils that will not be covered by this particular policy.
Floater: An insurance policy that covers property wherever it is located.
Flood: Coverage for damage caused by floods must be added as an endorsement. Flood insurance, which also covers damage caused by mudslides, is available through a program run by the Federal Insurance Administration.
Fire Insurance: Coverage protecting property against losses caused by a fire or lightning, usually included in homeowners or commercial multiple peril policies.
Glass Insurance: Coverage for glass breakage caused by all risks, fire and war are sometimes excluded.
General liability and Property Coverage: Liability insurance protects you if someone gets hurt while using your product or service or is injured while on your property. Property insurance: Covers your physical assets building, equipment, furnishings, fixtures, inventory and so on.
Group Insurance: A master policy covering a group, usually employees of the same company or members of the same association and their dependents.
Indemnify: Provide financial compensation for losses.
Insolvency: Insurers inability to pay debts. When regulators can place a company in conservatorship, rehabilitation or liquidation.
Insurance Pool: A group of insurance companies that pool assets, enabling them to provide larger amounts of insurance. Pools can be mandated by the state to cover risks properties subject to hurricanes or earthquakes.
Internet Liability Insurance: Coverage designed to protect businesses from liabilities from conducting internet busines. It covers including copyright and privacy infringement.
Impaired Insurer: An insurer that has financial difficulty meeting financial obligations or regulatory requirements.
Key Person Insurance: Insurance on the life or health of a key individual whose services are essential to the business. Premiums are paid by the company as an ordinary business expense. The death benefit will often go to the company to provide money necessary to recoup the loss of a key employee.
Lloyd's of London: A marketplace where small entrepreneur-insurers, meet to sell insurance policies and reinsurance.
Malpractice Insurance: Professional liability coverage for physicians, lawyers against negligence or errors and omissions law suits.
Market Value: The amount property could be sold. Marker value may be used to determine the amount of reimbursement for a loss.
Mediation: Nonbinding procedure in which a third party attempts to resolve a conflict between two other parties. Arbitration: A similar process that is binding. Package Policy: Itincludes more than one type of insurance coverage, also called a Multi-Line Policy.
Political Risk Insurance: Coverage for businesses operating abroad against loss due war, revolution, or confiscation of property.
Product Liability Insurance: Protects manufacturers and distributors exposure to lawsuits due to bodily injury or property damage from the use of its product(s).
Professional Liability Insurance: Covers professionals for negligence and errors or omissions that injure their clients.
Reinsurance: Insurance that an insurance company buys for its own protection. The risk of loss is spread so a large loss doesn't fall on one company.
Salvage: Damaged property an insurer takes over to reduce its losses. Insurers receive salvage rights over property on which they have paid claims.
Subrogation: When an insurance company has paid the insurer, it may have the right to initiate a law suit against another party to the loss to regain some of its funds.
Surety Bonds: Surety bonds provide reimbursement if a firm fails to complete a contract. It is a guarantee against loss for work promised but not completed.
Underwriter: The individual trained in evaluating risks and determining rates by evaluating insurance applicants.
Umbrella Policy: Provides additional liability coverage after the limits of your underlying policy are reached.
Workers' Compensation: Most employers are required by law to provide workers' compensation insurance. Workers Comp pays an employee's medical expenses and provides some income replacement when a worker is injured on the job.
Wrap-Up Insurance: Broad policy coordinated to cover liability exposures for a large group of businesses that have something in common. Might be used to insure all businesses working on a large construction project.
