Auto Insurance: A type of insurance coverage that protects against financial loss in the event of a car accident, theft, or damage to a vehicle. It provides liability, collision, and comprehensive coverage.
Adjuster: A person who investigates and assesses insurance claims to determine the amount of compensation that should be paid based on the policy’s terms and conditions.
Agent: An individual or business authorized to sell and service insurance policies on behalf of an insurance company. They help clients choose suitable coverage and assist with policy-related matters.
Actual Cash Value (ACV): The value of an insured item, such as a car or property, at the time of loss or damage. It is calculated by subtracting depreciation from the replacement cost.
Appraisal: An evaluation of the value of an insured item or property conducted by a qualified appraiser. It is often used to determine the appropriate amount of insurance coverage or settle a claim.
Bodily Injury Liability: Coverage that pays for medical expenses, legal fees, and other costs resulting from injuries or death to other people caused by the insured party in an accident.
Broker: An insurance professional who acts as an intermediary between the insured individual or business and insurance companies. Brokers help clients find suitable policies and negotiate terms.
Binder: A temporary insurance agreement that provides coverage until a formal policy is issued. It is typically used to provide immediate coverage while the details of a policy are being finalized.
Benefit: The amount payable by an insurance company to the policyholder or beneficiary in the event of a covered loss or claim.
Blanket Coverage: A type of insurance policy that provides coverage for multiple items, properties, or locations under a single limit of insurance.
Claim: A formal request made by the policyholder to an insurance company to compensate for a loss covered by the insurance policy. It typically involves providing documentation and evidence of the loss.
Coverage: The scope and extent of protection provided by an insurance policy. It outlines the specific risks, events, or circumstances for which the insurance company will provide compensation.
Collision Coverage: Insurance coverage that pays for the repair or replacement of an insured vehicle in the event of a collision, regardless of fault.
Co-payment: A predetermined, fixed amount that an insured individual must pay out of pocket for certain medical services or prescriptions, typically in addition to the insurance company’s portion.
Certificate of Insurance: A document provided by an insurance company to verify the existence of an insurance policy. It outlines the coverage, policy limits, and duration of the policy.
Deductible: The amount that the insured individual must pay out of pocket before the insurance company starts to cover the remaining costs. It helps reduce premium costs and is common in property, auto, and health insurance.
Declarations Page: The portion of an insurance policy that provides specific information about the insured, the insured property or item, and the coverage details. It includes policy limits, deductibles, and premium amounts.
Depreciation: The decrease in value of an asset over time due to factors such as wear and tear, age, or obsolescence. In insurance, it is often used to calculate the actual cash value of an item.
Disability Insurance: Coverage that provides income replacement in the event the insured person becomes disabled and unable to work. It ensures financial stability during a period of lost income.
Dwelling Coverage: Insurance coverage that protects the structure of a home or property against risks such as fire, theft, vandalism, or certain natural disasters. It does not typically cover the contents of the dwelling.
Exclusion: Specific risks or conditions that are not covered by an insurance policy. Exclusions are listed in the policy documents and define what the insurance company will not provide coverage for.
Endorsement: A modification or addition to an existing insurance policy that changes the terms, coverage, or conditions. It can be used to expand or restrict coverage based on the insured’s needs.
Effective Date: The date on which an insurance policy goes into effect and coverage begins. It is important to note when coverage starts to ensure there is no gap in protection.
Excess Coverage: Additional insurance coverage that supplements the primary insurance policy. It provides an extra layer of protection by increasing the policy limits.
Excess and Surplus Lines Insurance: Coverage provided by insurance companies that are not licensed in the state where the risk is located. It is used for unique or high-risk situations that standard insurance companies may not cover.
Flood Insurance: Insurance coverage that protects against property damage caused by flooding. It is separate from standard homeowners’ insurance and is typically required for properties located in high-risk flood zones.
Fraud: Intentional misrepresentation or deception with the purpose of obtaining an unfair or unlawful gain. Insurance fraud involves providing false information or making exaggerated claims to deceive an insurance company.
Fire Insurance: Insurance coverage that protects against property damage caused by fire. It typically includes coverage for the structure, personal belongings, and additional living expenses.
Fiduciary: A person or entity that has a legal and ethical obligation to act in the best interests of another party. In insurance, a fiduciary duty is often associated with insurance agents or brokers representing the interests of their clients.
Full Coverage: A term commonly used to describe comprehensive auto insurance coverage that includes liability, collision, and comprehensive coverage. It provides protection for a wide range of risks and events.
Grace Period: A specified period of time after the premium due date during which an insurance policy remains in force even if the premium has not been paid. It allows the insured individual to make a late payment without penalty.
Guaranteed Issue: A type of insurance policy that is offered without requiring the applicant to undergo a medical examination or provide detailed health information. It guarantees coverage regardless of the individual’s health condition.
Gap Insurance: Coverage that pays the difference between the actual cash value of a vehicle and the amount owed on a car loan or lease in the event of a total loss or theft.
General Liability Insurance: Insurance coverage that protects businesses against claims of bodily injury, property damage, or personal injury resulting from their operations, products, or services.
Group Insurance: Insurance coverage provided to a group of individuals, such as employees of a company or members of an organization. It often offers lower premiums and broader coverage than individual policies.
Homeowners Insurance: Insurance coverage that protects a homeowner against risks to the property and personal belongings. It typically includes dwelling coverage, personal property coverage, and liability protection.
Health Insurance: Coverage that pays for medical and surgical expenses incurred by the insured individual. It provides financial protection against high healthcare costs and can include various levels of coverage.
Hurricane Deductible: A separate deductible applied to property insurance claims specifically related to damage caused by hurricanes or named storms. It is typically higher than the standard deductible.
HMO (Health Maintenance Organization): A type of managed healthcare plan that requires individuals to use a network of doctors and hospitals to receive coverage. It focuses on preventive care and typically requires a primary care physician referral.
Hazard: A condition or situation that increases the likelihood of loss or damage. In insurance, hazards are assessed to determine the risk associated with insuring a particular person, property, or event.
Insurable Interest: The legal or financial interest that an individual or entity must have in the subject matter of an insurance policy in order to be eligible for coverage. It ensures that the insured party would suffer a financial loss if the insured item is damaged or destroyed.
Indemnity: The principle of insurance that aims to restore the insured party to the same financial position they were in before the loss occurred. It involves compensating the insured for the actual monetary value of the loss, up to the policy limits.
Inland Marine Insurance: Coverage that protects movable or specialized property, such as equipment, artwork, or valuable goods, while they are in transit or temporarily away from the insured location. It provides protection beyond what standard property insurance covers.
Insurer: The insurance company or organization that provides insurance coverage to individuals or businesses in exchange for the payment of premiums. The insurer assumes the risks specified in the insurance policy and pays out claims when applicable.
Insurance Policy: A legal contract between the insurer and the policyholder that outlines the terms, conditions, and coverage details of the insurance agreement. It specifies the risks covered, the policy limits, premiums, and other important provisions.
Jewelry Insurance: Specialized coverage that provides protection for valuable jewelry against risks such as theft, loss, or damage. It may offer higher policy limits and additional coverage options tailored specifically for jewelry items.
Joint Life Insurance: A life insurance policy that covers two individuals, typically spouses, under a single policy. It provides a death benefit upon the death of either insured individual, and the policy usually terminates when the first insured dies.
Jurisdiction: The geographic area or legal territory where an insurance policy is valid and enforceable. It determines the laws and regulations that govern the insurance contract and the resolution of any disputes.
Juvenile Insurance: Life insurance coverage that is specifically designed for children or young individuals. It provides financial protection for the child and may accumulate cash value over time.
Job-Related Illness: An illness or health condition that is directly caused or exacerbated by the individual’s work or work environment. Job-related illnesses may be covered under workers’ compensation or occupational disease insurance.
Key Person Insurance: A type of life insurance policy that covers a key employee or business owner whose death or disability would cause significant financial loss or disruption to the business. It provides funds to help the company recover and transition in such circumstances.
Kidnap and Ransom Insurance: Coverage that protects individuals or companies against financial losses resulting from kidnapping, extortion, or hijacking incidents. It may cover ransom payments, legal expenses, and other related costs.
Known Loss: A loss or damage that has occurred or is known to have taken place before the insurance policy’s effective date. Known losses are generally not covered by insurance, as policies are intended to protect against unforeseen events.
Keying Error: A mistake made by an insurance company or its agents during the data entry process, resulting in errors or discrepancies in the policy or coverage details. Keying errors can lead to incorrect premium calculations or policy inaccuracies.
Knowledge Transfer: The process of sharing or transferring specialized knowledge or expertise from one individual or group to another within an organization. In the insurance context, knowledge transfer ensures continuity and accuracy in underwriting, claims handling, or risk assessment processes.
Liability Insurance: Coverage that protects individuals or businesses against claims for bodily injury or property damage caused to others due to their negligence or actions. It provides financial protection and covers legal expenses in the event of a lawsuit.
Loss Control: Measures and strategies implemented by individuals, businesses, or insurance companies to prevent or minimize the frequency and severity of losses. Loss control aims to reduce the risk of accidents, damages, or liabilities.
Loss Payee: The individual or entity designated on an insurance policy as the recipient of claim payments in the event of a covered loss. Loss payees may include mortgage lenders, lessors, or other parties with a financial interest in the insured property.
Life Insurance: Coverage that provides a death benefit to the beneficiaries upon the insured person’s death. It offers financial protection and may also include cash value accumulation or investment components.
Long-Term Care Insurance: Insurance coverage that helps cover the costs of long-term care services, such as nursing home care, assisted living facilities, or in-home care. It provides financial support for individuals who need assistance with daily activities or medical care in their later years.
Malpractice Insurance: Coverage that protects professionals, such as doctors, lawyers, or architects, against claims and lawsuits alleging negligence, errors, or omissions in their professional services. It provides financial protection and covers legal expenses.
Mortgage Insurance: Insurance coverage that protects lenders against losses if the borrower defaults on a mortgage loan. It is typically required for borrowers who make a down payment of less than 20% of the home’s purchase price.
Mediation: A voluntary, non-adversarial process used to resolve disputes between the insured and the insurance company. Mediation involves a neutral third party who facilitates communication and negotiation to reach a mutually acceptable resolution.
Medicare: A federal health insurance program in the United States that provides coverage for individuals aged 65 and older, as well as certain younger individuals with disabilities or specific medical conditions.
Misrepresentation: Providing false or misleading information to an insurance company or agent with the intent to deceive or obtain favorable terms. Misrepresentation can lead to policy cancellation, claim denial, or legal consequences.
Named Perils: Specific risks or perils that are listed and covered by an insurance policy. Only the risks explicitly stated in the policy are covered, and all other risks are excluded.
Negligence: The failure to exercise reasonable care or the breach of a duty owed to another person, resulting in injury, damage, or financial loss. Negligence is a common basis for liability claims and lawsuits.
Non-Renewal: The decision by an insurance company to not renew an insurance policy when it expires. Non-renewal can occur for various reasons, such as increased risk, changes in underwriting guidelines, or the insured’s failure to comply with policy conditions.
No-Fault Insurance: Auto insurance coverage that provides compensation to policyholders regardless of who is at fault in an accident. It aims to streamline the claims process and reduce litigation by avoiding the need to determine fault.
Notice of Loss: A formal notification submitted by the insured to the insurance company to report a loss or claim. It typically includes details of the incident, the date and location of the loss, and any relevant supporting documentation.
Occurrence: In liability insurance, an event or incident that results in property damage, bodily injury, or personal injury during the policy period. Occurrence-based policies cover claims that arise from events that occurred during the policy term, regardless of when the claim is filed.
Open Enrollment: A designated period during which individuals can enroll in or make changes to their health insurance plans. Open enrollment periods are typically annual and allow individuals to select or switch health insurance coverage without requiring a qualifying event.
Ordinance or Law Coverage: Insurance coverage that helps pay for the cost of complying with building codes or laws when repairing or rebuilding a damaged property. It covers the additional expenses incurred due to changes in building codes or regulations since the property was originally constructed.
Overhead Expense Insurance: Coverage that reimburses a business for ongoing overhead expenses, such as rent, utilities, and employee salaries, in the event that the business owner becomes disabled and unable to work. It helps the business maintain financial stability during the owner’s absence.
Policyholder: The individual or entity that owns an insurance policy. The policyholder pays the premiums and is entitled to the benefits and coverage provided by the insurance contract.
Premium: The amount of money an individual or business pays to an insurance company in exchange for insurance coverage. Premiums are typically paid on a regular basis, such as monthly or annually, and may vary based on factors such as risk, coverage limits, and deductibles.
Property Insurance: Coverage that protects against financial loss or damage to property, including buildings, structures, personal belongings, and certain assets. Property insurance policies can be tailored to specific risks and may include options for different types of properties, such as homeowners, renters, or commercial property.
Peril: A specific cause of loss or damage covered by an insurance policy. Common perils include fire, theft, vandalism, natural disasters, and accidents. The policy terms define which perils are covered and the extent of coverage for each.
Quote: An estimate of the premium cost for an insurance policy provided by an insurance company. Quotes are based on the information provided by the applicant and serve as an initial pricing indication before the policy is issued.
Rider: Also known as an endorsement, a rider is a modification or addition to an existing insurance policy. It allows policyholders to customize their coverage by adding or removing specific provisions or extending coverage limits for certain risks.
Risk: The possibility of loss, damage, or injury due to exposure to a particular hazard or event. In insurance, risk refers to the chance of an insured event occurring and is evaluated by insurers to determine premium rates and policy terms.
Subrogation: The process by which an insurance company assumes the rights of the insured party to seek reimbursement from a third party responsible for causing a loss or damage. Subrogation helps the insurer recover the amount paid to the insured for a claim.
Surety Bond: A type of bond that provides financial compensation if a party fails to fulfill its contractual obligations. Surety bonds are often used in construction projects or to guarantee the performance of certain professional services.
Term Life Insurance: Life insurance coverage that provides a death benefit for a specified term or period, typically 10, 20, or 30 years. Term life insurance policies do not accumulate cash value and generally offer lower premiums compared to permanent life insurance.
Umbrella Insurance: Additional liability insurance that provides coverage above and beyond the limits of primary insurance policies, such as homeowners or auto insurance. Umbrella insurance offers broader protection and higher policy limits, helping to protect against major claims or lawsuits.
Variable Life Insurance: A type of permanent life insurance that includes an investment component. Policyholders have the option to allocate a portion of their premiums into investment accounts, such as stocks or bonds, which can accumulate cash value over time.
Waiver: A voluntary relinquishment or abandonment of a right or privilege. In insurance, a waiver can refer to the intentional surrender of certain policy provisions or coverage options by the insured.
(eXclusion) – No additional definition provided in this context.
Yearly Renewable Term (YRT) Insurance: A type of term life insurance policy that is renewable on a yearly basis. The premium for YRT insurance increases each year as the insured gets older but provides coverage for one year at a time.
Zero Deductible: An insurance policy provision where the insured party does not have to pay a deductible before the insurance company starts covering the costs. This is commonly seen in certain types of health insurance policies or warranties.