Actual Cash Value
The cost of repairing or replacing damaged property with property of the same kind and quality, less depreciation (i.e., in the same physical condition as the original property prior to damage).
Additional Coverages
Extra coverage that can be purchased to provide protection above and beyond that provided in the homeowners policy (e.g., a higher amount of coverage against the theft of jewelry). When such additional coverage is purchased, it becomes an Endorsement or Rider to the original policy.
Additional Living Expense
ALE provides reimbursement for motel rooms, meals and other expenses while a house is being repaired or rebuilt.
Adjuster
Determine the insurer’s liability for loss when a claim is filed.
Agency
An insurance sales office.
Claim
A request made by an insured for payment of benefits.
Coverage
Protection provided under an insurance contract.
Depreciation
A decrease in the value of property due to use, time and wear and tear.
Dwelling Policy
Excludes liability coverage.
Endorsement
An add-on to an insurance policy that increases coverage.
Exclusion
Events, conditions or circumstances that are not being covered under an insurance policy.
Insurance Fraud
Lying to receive payment of an insurance claim.
Insured
The party covered by an insurance policy.
Liability Insurance
Insurance that pays protects policyholders from bodily injury or property lawsuits.
Loss of Use
See Additional Living Expense
Market Value
The price a house would sell for under current market conditions.
Peril
An event or circumstance that causes loss.
Personal Liability
See Liability Insurance.
Policy
A contract between the insurance company and the policyholder that outlines which perils are and are not covered.
Premium
The amount of money a policyholder pays an insurance company for insurance coverage.
Property Coverages
Insurance that covers damage to a policyholder’s property.
Renters Insurance
Insurance for renters that covers personal property and liability.
Replacement Value
The cost of replacing property without deducting depreciation.
Risk
The chance of loss.
Underwriter
A person who reviews applications for insurance coverage and decides if the applicant will be insured and at what price.
