Glossary
Plain-language definitions for every term you will encounter. Browse by letter or filter by category.
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A
Actual Cash Value
Replacement cost minus depreciation, used to calculate claim payouts.
Claims ProcessAll-Risk Policy
A policy that covers all causes of loss except those specifically excluded.
Home InsuranceAdditional Insured
A person or entity added to a policy who receives coverage but is not the named insured.
Claims ProcessAppraisal
A dispute resolution process where each side hires an appraiser to determine the loss amount.
SettlementArbitration
A binding dispute resolution process where an arbitrator decides the outcome instead of a court.
SettlementAggregate Limit
The maximum total amount an insurer will pay for all claims during a policy period.
Claims ProcessAdditional Living Expenses
Reimbursement for temporary housing, meals, and other costs while a home is being repaired.
Home InsuranceAdmitted Carrier
An insurance company licensed and regulated by the state department of insurance.
Claims ProcessAdvertising Injury
Coverage for claims of copyright infringement, libel, or slander in advertising activities.
LiabilityActual Damages
Real, measurable losses suffered by the claimant, including both economic and non-economic harm.
Legal TermsAccord and Satisfaction
An agreement to accept a different amount than originally claimed in full settlement of a dispute.
SettlementAdvance Payment
A partial payment issued by the insurer before the final claim amount has been determined.
SettlementAnti-Concurrent Causation
A policy clause that denies coverage when an excluded peril contributes to the loss.
Legal TermsAdhesion Contract
A policy drafted entirely by the insurer where the insured can only accept or reject it.
Legal TermsAmbiguity
Unclear policy language that courts typically interpret in favor of the insured.
Legal TermsAssignment
The transfer of insurance policy rights or benefits from the insured to a third party.
Claims ProcessAct of God
An unforeseeable natural event such as a tornado, earthquake, or flood beyond human control.
Claims ProcessAnnuity
A financial product that pays a fixed stream of income, often used in structured settlements.
SettlementAppeal
A request for a higher court to review and change the decision of a lower court.
Legal TermsAssumption of Risk
A defense where the defendant proves the claimant knowingly accepted the danger involved.
Legal TermsAttractive Nuisance
A hazardous feature on property that may attract children, imposing extra liability on the owner.
LiabilityB
Bodily Injury
Physical harm to a person caused by an accident or intentional act covered under a policy.
LiabilityBad Faith
An insurer's unreasonable denial, delay, or underpayment of a valid insurance claim.
Legal TermsBinder
A temporary agreement providing insurance coverage until the formal policy is issued.
Claims ProcessBusiness Interruption
Coverage that replaces lost income when a business cannot operate due to a covered loss.
Claims ProcessBetterment
An improvement to property beyond its pre-loss condition, which the insurer may not fully cover.
Claims ProcessBuilders Risk
A policy covering a building under construction against damage from covered perils.
Home InsuranceBusiness Owners Policy
A bundled policy combining commercial property and general liability coverage for small businesses.
Claims ProcessBailee Coverage
Insurance protecting property of others that is temporarily in the care of the insured business.
Claims ProcessBoiler and Machinery
Coverage for damage caused by the breakdown of equipment such as boilers, motors, and HVAC systems.
Claims ProcessC
Collision Coverage
Auto insurance that pays for damage to your vehicle from a collision with another object.
Auto InsuranceComprehensive Coverage
Auto insurance covering non-collision losses such as theft, hail, fire, and vandalism.
Auto InsuranceComparative Negligence
A rule that reduces damages by the percentage of fault assigned to the claimant.
Legal TermsContributory Negligence
A rule that bars recovery entirely if the claimant is even partially at fault.
Legal TermsClaims Adjuster
A professional who investigates insurance claims and determines the amount the insurer should pay.
Claims ProcessContingency Fee
A fee structure where an attorney is paid a percentage of the settlement or verdict.
Legal TermsCoinsurance
A clause requiring the insured to carry coverage equal to a set percentage of property value.
Claims ProcessCoinsurance Penalty
A reduced payout applied when the insured fails to maintain the required coinsurance percentage.
Claims ProcessClaims-Made Policy
A policy that covers claims reported during the policy period regardless of when the loss occurred.
Claims ProcessCancellation
The termination of an insurance policy before its scheduled expiration date.
Claims ProcessCombined Single Limit
A single liability limit that applies to all bodily injury and property damage per accident.
Auto InsuranceCertificate of Insurance
A document proving that an insurance policy exists and summarizing its key coverage details.
Claims ProcessCompleted Operations
Coverage for liability arising from work a contractor has finished and turned over to the owner.
LiabilityClaim Number
A unique identifier assigned by the insurer to track and manage a specific claim.
Claims ProcessClaim Denial
A formal decision by an insurer refusing to pay a submitted claim.
Claims ProcessClaim Reopening
The process of reopening a previously closed claim when new damages or information arise.
Claims ProcessConsequential Damages
Indirect losses resulting from a covered event, such as lost business income or spoiled goods.
Legal TermsCompromise and Release
A settlement agreement where both parties agree to a payment amount and the claim is closed.
SettlementCause of Loss
The specific event or peril that triggered the damage, such as fire, wind, or theft.
Claims ProcessConcurrent Causation
A situation where two or more perils combine to cause a single loss.
Legal TermsConcealment
The intentional withholding of material facts from an insurer during the application process.
Legal TermsClaim File
The complete record of all documents, communications, and decisions related to a single claim.
Claims ProcessCatastrophe Adjuster
An adjuster deployed to handle large volumes of claims following a natural disaster.
Claims ProcessCatastrophe
A large-scale disaster causing widespread insured losses, typically exceeding a set dollar threshold.
Claims ProcessContribution
The right of an insurer that paid a claim to recover a share from other insurers covering the loss.
Claims ProcessConsent to Settle
A policy clause requiring the insured's approval before the insurer settles a claim.
SettlementComplaint
The initial legal document filed by a plaintiff to begin a lawsuit against a defendant.
Legal TermsClass Action
A lawsuit filed by one or more plaintiffs on behalf of a larger group with similar claims.
Legal TermsCommercial Property
Insurance covering business-owned buildings, equipment, and inventory against covered losses.
Claims ProcessCommercial Auto
Insurance covering vehicles used for business purposes, including company cars and fleet vehicles.
Auto InsuranceCyber Liability
Insurance covering losses from data breaches, cyberattacks, and network security failures.
LiabilityCausation
The link between a party's action and the resulting harm, required to establish liability.
Legal TermsClaim Reserve
Money set aside by an insurer to cover the estimated future payout on an open claim.
Claims ProcessConditions
The section of a policy listing the duties and obligations of both the insurer and the insured.
Claims ProcessD
Depreciation
The decrease in property value over time due to age, wear, and obsolescence.
Claims ProcessDeductible
The amount a policyholder must pay out of pocket before insurance coverage kicks in.
Claims ProcessDeclarations Page
The section of a policy listing the insured, coverages, limits, and premium amounts.
Claims ProcessDemand Letter
A formal written request sent to an insurer or at-fault party seeking a specific payment amount.
SettlementDwelling Coverage
The portion of a homeowners policy that covers the physical structure of the home.
Home InsuranceDuty to Defend
An insurer's obligation to provide legal defense for claims that may fall within policy coverage.
Legal TermsDuty to Indemnify
An insurer's obligation to pay covered losses on behalf of the insured.
Legal TermsDepartment of Insurance
The state agency that regulates insurers, licenses agents, and handles consumer complaints.
Legal TermsDiminished Value
The loss in a vehicle's market value after it has been damaged and repaired.
Auto InsuranceDeductible Buyback
An endorsement that reduces or eliminates the deductible for an additional premium.
Claims ProcessDuty to Cooperate
The policyholder's obligation to assist the insurer in investigating and settling a claim.
Legal TermsDeclaratory Judgment
A court ruling that determines whether an insurance policy covers a particular claim.
Legal TermsDepreciation Holdback
The portion of depreciation withheld from an initial ACV payment, recoverable after repairs.
Claims ProcessDesk Adjuster
An adjuster who reviews and processes claims from an office without visiting the loss site.
Claims ProcessDeposition
Sworn, out-of-court testimony given by a witness and recorded for use in a lawsuit.
Legal TermsDiscovery
The pre-trial phase where both sides exchange evidence, documents, and witness information.
Legal TermsDwelling Fire Policy
A basic property policy covering a dwelling against fire and named perils only.
Home InsuranceDirectors and Officers
Insurance protecting company leadership against personal liability for management decisions.
LiabilityDeductible Credit
A premium reduction given in exchange for the insured choosing a higher deductible.
Claims ProcessE
Endorsement
A written amendment that adds, removes, or changes coverage in an insurance policy.
Claims ProcessExclusion
A provision in a policy that eliminates coverage for specific risks or circumstances.
Claims ProcessExamination Under Oath
A recorded, sworn interview conducted by the insurer to investigate a claim's validity.
Legal TermsEffective Date
The date on which an insurance policy or endorsement begins providing coverage.
Claims ProcessExpiration Date
The date on which an insurance policy ceases to provide coverage.
Claims ProcessEstoppel
A legal principle preventing an insurer from denying coverage after making misleading statements.
Legal TermsEarthquake Insurance
A separate policy or endorsement covering damage caused by earthquakes and related ground movement.
Home InsuranceExcess Insurance
A policy that pays only after underlying coverage limits have been fully exhausted.
LiabilityErrors and Omissions
Insurance protecting professionals against claims of inadequate work or negligent actions.
LiabilityEmployers Liability
Coverage for lawsuits by employees who are injured at work and sue beyond workers comp benefits.
LiabilityExtra Expense Coverage
Insurance that pays additional costs incurred to keep a business running after a covered loss.
Claims ProcessEquipment Breakdown
Modern version of boiler and machinery coverage protecting against mechanical and electrical failures.
Claims ProcessEmployment Practices Liability
Coverage for claims of discrimination, harassment, or wrongful termination by employees.
LiabilityExperience Modification
A factor that adjusts workers comp premiums based on a business's actual loss history.
Claims ProcessF
First Party Claim
A claim filed by the policyholder against their own insurance company for a covered loss.
Claims ProcessFloater
Coverage for specific high-value personal property that moves with the owner.
Home InsuranceFinancial Responsibility
A state law requiring drivers to prove they can pay for damages caused in an accident.
Auto InsuranceFlood Insurance
A separate policy covering losses from flooding, typically excluded from standard homeowners policies.
Home InsuranceField Adjuster
An adjuster who inspects damage at the property location rather than reviewing claims remotely.
Claims ProcessForce Majeure
An extraordinary event beyond the control of parties that excuses contractual performance.
Legal TermsFiduciary Liability
Insurance covering claims of mismanagement of employee benefit plans and retirement funds.
LiabilityFEMA
The Federal Emergency Management Agency, which administers the National Flood Insurance Program.
Home InsuranceG
Guaranty Fund
A state fund that pays claims when an admitted insurer becomes insolvent.
Claims ProcessGap Insurance
Coverage that pays the difference between a totaled vehicle's ACV and the remaining loan balance.
Auto InsuranceGeneral Liability
Commercial insurance covering bodily injury and property damage claims from business operations.
LiabilityGeneral Damages
Non-economic losses like pain, suffering, and loss of enjoyment that lack a fixed dollar amount.
SettlementGood Faith Estimate
An insurer's preliminary assessment of the expected cost to repair or replace damaged property.
Claims ProcessGrace Period
A set number of days after a premium due date during which coverage remains in effect.
Claims ProcessH
Hold Harmless Agreement
A contract clause where one party agrees not to hold the other liable for certain losses.
LiabilityHurricane Deductible
A separate, higher deductible that applies specifically to hurricane-related damage claims.
Home InsuranceHammer Clause
A provision limiting the insurer's liability if the insured refuses a reasonable settlement offer.
SettlementHO-3 Policy
The most common homeowners policy providing all-risk coverage on the dwelling and named perils on contents.
Home InsuranceHO-5 Policy
A premium homeowners policy providing all-risk coverage on both the dwelling and personal property.
Home InsuranceHO-6 Policy
A condo owners policy covering interior walls, personal property, and personal liability.
Home InsuranceHired and Non-Owned Auto
Coverage for vehicles rented or owned by employees when used for business purposes.
Auto InsuranceI
Indemnification
The principle of restoring the insured to the same financial position they held before the loss.
Claims ProcessIndependent Adjuster
A freelance adjuster hired by insurers to investigate and settle claims on their behalf.
Claims ProcessInsolvency
The inability of an insurance company to pay its obligations and claims.
Claims ProcessInsurance Fraud
Intentional deception committed to obtain an undeserved insurance payout.
Legal TermsIndependent Medical Examination
A medical evaluation requested by the insurer to verify the extent of claimed injuries.
Claims ProcessIncontestability Clause
A provision preventing the insurer from contesting a policy after it has been in force for a set time.
Claims ProcessInsurable Interest
A financial stake in the insured property or person that gives the right to buy insurance.
Claims ProcessInterrogatories
Written questions sent to the opposing party that must be answered under oath during discovery.
Legal TermsIntervening Cause
An event occurring after the initial cause that contributes to the final loss or injury.
Legal TermsIndemnity Agreement
A contract in which one party agrees to compensate the other for certain losses or damages.
LiabilityInland Marine
Coverage for goods in transit or movable property not adequately covered by standard policies.
Claims ProcessIBNR
Incurred but not reported losses that an insurer estimates for claims not yet filed.
Claims ProcessInsuring Agreement
The core section of a policy stating what the insurer promises to cover.
Claims ProcessJ
L
Liability Coverage
Insurance that pays for bodily injury or property damage the policyholder causes to others.
LiabilityLien
A legal claim against settlement proceeds by a party owed money, such as a medical provider.
Legal TermsLoss of Use
Coverage that pays additional living expenses when a home is uninhabitable after a covered loss.
Home InsuranceLoss Ratio
The percentage of premiums an insurer pays out in claims, used to measure profitability.
Claims ProcessLiability Split Limits
Auto liability expressed as three numbers: per-person BI, per-accident BI, and property damage.
Auto InsuranceLoss Payee
A party listed on a policy who receives claim payments, typically a lender or lienholder.
Claims ProcessLost Wages
Income a claimant was unable to earn because of injuries sustained in a covered incident.
SettlementLost Earning Capacity
The reduction in a claimant's future ability to earn income due to permanent injuries.
SettlementLine Item
An individual entry in a repair estimate representing a specific task, material, or labor cost.
Claims ProcessLump Sum
A single, one-time payment of the full settlement amount rather than periodic installments.
SettlementLitigation
The process of resolving a dispute through the court system, including filing a lawsuit.
Legal TermsLoss Run
A report listing all claims filed on a policy, used by underwriters to assess future risk.
Claims ProcessLiberalization Clause
A provision automatically applying broader coverage if the insurer changes its standard policy forms.
Claims ProcessM
Mediation
A non-binding process where a neutral mediator helps both parties reach a voluntary agreement.
SettlementMedical Payments Coverage
Coverage that pays small medical bills for guests injured on your property regardless of fault.
LiabilityMoral Hazard
The increased risk that an insured will act carelessly because they have insurance coverage.
Claims ProcessMaterial Misrepresentation
A false statement on an application that would have changed the insurer's underwriting decision.
Legal TermsMinimum Coverage
The lowest amount of liability insurance required by state law to legally drive.
Auto InsuranceMortgage Clause
A policy provision protecting a mortgage lender's interest in the insured property.
Home InsuranceMold Coverage
Limited coverage for mold remediation, often capped at a low sublimit on homeowners policies.
Home InsuranceMalpractice Insurance
Professional liability coverage specifically for medical, legal, or other licensed practitioners.
LiabilityMaximum Medical Improvement
The point at which an injured person's condition has stabilized and will not improve further.
Claims ProcessMultiplier Method
A formula that multiplies special damages by a factor to estimate pain and suffering compensation.
SettlementMitigation of Damages
The duty of the insured to take reasonable steps to prevent further loss after an incident.
Legal TermsN
Named Peril
A policy that only covers losses caused by perils specifically listed in the contract.
Home InsuranceNo-Fault Insurance
A system where each driver's own insurer pays their losses regardless of fault.
Auto InsuranceNegligence
Failure to exercise reasonable care, resulting in harm to another person or their property.
Legal TermsNamed Insured
The person or entity specifically listed on the declarations page as the policyholder.
Claims ProcessNon-Renewal
An insurer's decision not to continue coverage when the current policy period ends.
Claims ProcessNFIP
The National Flood Insurance Program, a federal program providing flood coverage to homeowners.
Home InsuranceNotice of Claim
The formal notification sent to an insurer that a loss has occurred and a claim is being made.
Claims ProcessNon-Recoverable Depreciation
Depreciation deducted from a claim payment that cannot be reclaimed even after repairs are made.
Claims ProcessNose Coverage
A retroactive date extension that covers claims arising from acts before the policy inception date.
Claims ProcessNamed Storm Deductible
A separate deductible triggered when damage is caused by an officially named tropical storm.
Home InsuranceNamed Driver Exclusion
An endorsement that removes coverage for a specific driver listed on the policy.
Auto InsuranceO
Occurrence
An accident or event that triggers coverage, including continuous or repeated exposure.
Claims ProcessOther Structures Coverage
Coverage for detached buildings on the property such as garages, sheds, and fences.
Home InsuranceOrdinance or Law Coverage
Coverage for extra costs to rebuild a home to current building codes after a covered loss.
Home InsuranceOccupational Injury
An injury sustained by an employee during the course and scope of their employment.
LiabilityOverhead and Profit
The markup charged by a general contractor for managing repairs, typically 20% of repair costs.
Claims ProcessOther Insurance Clause
A policy provision explaining how coverage applies when multiple policies cover the same loss.
Claims ProcessOccurrence Form
A policy that covers incidents occurring during the policy period, regardless of when reported.
Claims ProcessOut-of-Pocket
Expenses paid directly by the insured that are not reimbursed by the insurance policy.
Claims ProcessP
Premium
The periodic payment made to an insurance company in exchange for coverage.
Claims ProcessPeril
A specific cause of loss such as fire, wind, theft, or vandalism.
Home InsuranceProperty Damage
Physical harm to or destruction of tangible property belonging to another person.
LiabilityPersonal Injury Protection
No-fault coverage that pays medical bills and lost wages regardless of who caused the accident.
Auto InsuranceProximate Cause
The primary cause that directly leads to a loss or injury in a claim.
Legal TermsPublic Adjuster
A licensed adjuster hired by the policyholder to negotiate a claim against the insurer.
Claims ProcessProof of Loss
A formal sworn statement submitted by the insured documenting the details and amount of a loss.
Claims ProcessPolicy Limit
The maximum amount an insurer will pay for a covered loss under a policy.
Claims ProcessPer-Occurrence Limit
The maximum amount an insurer will pay for any single claim or incident.
Claims ProcessPersonal Property Coverage
Insurance that covers belongings inside the home such as furniture, electronics, and clothing.
Home InsurancePro-Rata Cancellation
A cancellation where the premium refund is proportional to the remaining policy period.
Claims ProcessPartial Loss
A loss where damaged property can be repaired for less than its total value.
Claims ProcessProfessional Liability
Coverage for claims of negligence or errors arising from professional services.
LiabilityProduct Liability
Coverage for claims of injury or damage caused by products manufactured or sold by the insured.
LiabilityPremises Liability
Legal responsibility for injuries occurring on property owned or controlled by the insured.
LiabilityPersonal Injury
Coverage for non-physical harms such as libel, slander, false arrest, and invasion of privacy.
LiabilityPain and Suffering
Non-economic damages compensating for physical pain and emotional distress caused by an injury.
SettlementPer Diem
A method of calculating pain and suffering by assigning a daily dollar value for each day affected.
SettlementPunitive Damages
Additional damages awarded to punish an insurer or defendant for willful or reckless misconduct.
Legal TermsPrimary Insurance
The first policy to respond and pay up to its limits before other policies contribute.
Claims ProcessPro Rata Clause
A provision that divides a loss proportionally among all policies covering the same risk.
Claims ProcessPrior Acts Coverage
Coverage for incidents that happened before the current policy but are reported during the term.
Claims ProcessPercentage Deductible
A deductible calculated as a percentage of the insured value rather than a flat dollar amount.
Home InsurancePerformance Bond
A bond guaranteeing a contractor will complete a project according to the contract terms.
Claims ProcessPayment Bond
A bond ensuring a contractor pays subcontractors, laborers, and material suppliers.
Claims ProcessProof of Insurance
Documentation showing that valid insurance coverage is in effect, such as an insurance card.
Auto InsurancePermissive Use
Coverage extended to someone driving the insured vehicle with the owner's permission.
Auto InsurancePolicy Period
The span of time during which an insurance policy provides coverage.
Claims ProcessPair and Set Clause
A provision limiting payment for a lost item that is part of a pair or set to its proportional value.
Claims ProcessProtective Safeguards
A warranty requiring the insured to maintain security features like alarms or sprinklers.
Home InsuranceR
Replacement Cost
The amount needed to replace damaged property with new items of similar kind and quality.
Claims ProcessRelease
A legal document signed by the claimant waiving further claims in exchange for payment.
SettlementReservation of Rights
A letter from an insurer stating it may deny coverage while still investigating the claim.
Legal TermsRider
An add-on to a policy that provides additional or modified coverage for specific items.
Claims ProcessRetroactive Date
The earliest date from which a claims-made policy will cover incidents.
Claims ProcessRenewal
The continuation of a policy for another term, often with updated rates and conditions.
Claims ProcessRepair Estimate
A written assessment of the cost to fix damaged property, used to determine claim payouts.
Claims ProcessRescission
The voiding of a policy from inception due to fraud or material misrepresentation.
Legal TermsRental Reimbursement
Coverage that pays for a rental car while your insured vehicle is being repaired.
Auto InsuranceReservation of Rights Letter
A written notice informing the insured that coverage may not apply to a reported claim.
Legal TermsRecoverable Depreciation
Depreciation that the insured can reclaim by completing repairs and submitting receipts.
Claims ProcessReinstatement
The restoration of a lapsed or cancelled policy to active status, usually with back premium payment.
Claims ProcessRespondeat Superior
A doctrine holding employers liable for employees' negligent acts performed within their job scope.
Legal TermsRenters Insurance
A policy covering a tenant's personal property, liability, and additional living expenses.
Home InsuranceRetrospective Rating
A premium plan where the final cost is adjusted based on actual losses during the policy period.
Claims ProcessS
Subrogation
The insurer's right to pursue a third party that caused the loss to recover paid claims.
Claims ProcessSworn Statement in Proof of Loss
A notarized document the insured signs under oath detailing the claimed loss amount.
Claims ProcessSettlement
An agreed-upon payment that resolves an insurance claim without going to trial.
SettlementStructured Settlement
A settlement paid in periodic installments over time instead of a single lump sum.
SettlementStatute of Limitations
The legal deadline by which a claim or lawsuit must be filed or it is permanently barred.
Legal TermsSurplus Lines
Insurance placed with non-admitted carriers for risks standard insurers will not cover.
Claims ProcessScheduled Personal Property
A list of specific valuable items insured for stated amounts on a policy.
Home InsuranceShort-Rate Cancellation
A cancellation where the insurer retains a penalty portion of the unearned premium.
Claims ProcessSalvage
The remaining value of damaged property that an insurer recovers after paying a total loss claim.
Claims ProcessScope of Loss
A detailed list of all damage items and repairs needed, prepared during the claims inspection.
Claims ProcessStacking
Combining coverage limits from multiple policies or vehicles to increase available benefits.
Auto InsuranceSR-22
A certificate filed by an insurer proving a high-risk driver carries the required minimum coverage.
Auto InsuranceSubrogation Waiver
An agreement where the insurer gives up its right to pursue a third party for reimbursement.
Claims ProcessSinkhole Coverage
Insurance covering structural damage caused by sinkhole activity beneath the property.
Home InsuranceSublimit
A lower coverage cap within a policy that applies to a specific type of loss or property.
Claims ProcessSelf-Insured Retention
The amount an insured must pay from their own funds before excess or umbrella coverage applies.
LiabilitySlip and Fall
A common premises liability claim where someone is injured by a hazardous walking surface.
LiabilitySupplemental Claim
An additional claim filed for damages discovered after the original claim was processed.
Claims ProcessSpecial Damages
Quantifiable economic losses such as medical bills, lost wages, and property repair costs.
SettlementStaff Adjuster
An adjuster employed directly by an insurance company rather than working independently.
Claims ProcessSummons
A legal notice served on a defendant informing them of a lawsuit and requiring a response.
Legal TermsSummary Judgment
A court ruling resolving a case without trial when there are no disputed material facts.
Legal TermsSuperseding Cause
An unforeseeable event that breaks the chain of causation and relieves the original party of liability.
Legal TermsStrict Liability
Legal responsibility imposed without proof of negligence, often applied to dangerous activities.
Legal TermsSurety Bond
A three-party agreement guaranteeing that a contractor will fulfill their obligations.
Claims ProcessT
Tort
A civil wrong that causes harm and gives the injured party the right to sue for damages.
Legal TermsThird Party Claim
A claim filed against another person's insurance policy for damages they caused.
Claims ProcessTail Coverage
Extended reporting period coverage that allows claims to be reported after a claims-made policy ends.
Claims ProcessTotal Loss
A loss where the cost to repair damaged property exceeds its actual cash value.
Claims ProcessTowing and Labor
Optional auto coverage that pays for towing and roadside labor when your vehicle breaks down.
Auto InsuranceTender of Defense
A formal request for an insurer to provide a legal defense under the policy's duty to defend.
Legal TermsU
Uninsured Motorist Coverage
Coverage that pays your damages when the at-fault driver has no insurance.
Auto InsuranceUnderinsured Motorist Coverage
Coverage that pays the gap when the at-fault driver's policy limits are too low.
Auto InsuranceUmpire
A neutral third party who breaks ties between appraisers during the appraisal process.
SettlementUmbrella Policy
An extra liability policy that provides coverage above the limits of underlying policies.
LiabilityUnderinsurance
A situation where policy limits are too low to fully cover the value of a loss.
Claims ProcessUnderwriting
The process of evaluating risk and determining whether to issue a policy and at what price.
Claims ProcessUnfair Claims Practices
Illegal insurer conduct such as unreasonable delays, lowball offers, or deceptive tactics.
Legal TermsUtmost Good Faith
The legal duty of both the insurer and the insured to act honestly in all policy dealings.
Legal TermsUnoccupied vs Vacant
Unoccupied means temporarily empty with furnishings; vacant means stripped of contents.
Home InsuranceV
Valued Policy
A policy that pays the full face amount for a total loss, regardless of actual value.
Claims ProcessValued Policy Law
A state statute requiring insurers to pay the full policy face amount for a total property loss.
Legal TermsVacancy Clause
A policy provision that limits or denies coverage if a property is vacant for an extended period.
Home InsuranceVerdict
The final decision rendered by a judge or jury at the conclusion of a trial.
Legal TermsVicarious Liability
Liability imposed on one party for the acts of another, such as an employer for an employee.
Legal TermsW
Waiver
The voluntary giving up of a known right, which may prevent an insurer from denying a claim.
Legal TermsWater Damage
Damage caused by sudden and accidental water discharge, often covered under homeowners policies.
Home InsuranceWindstorm Coverage
Insurance covering damage from wind events such as hurricanes, tornadoes, and severe storms.
Home InsuranceWorkers Compensation
Insurance that pays medical bills and lost wages for employees injured on the job.
LiabilityWrite Your Own
A program where private insurers issue and service NFIP flood insurance policies.
Home InsuranceWaiting Period
A set number of days after purchasing a policy before coverage becomes effective.
Claims Process