Home Insurance Terms A-C

Glossary of defined terms

What do the terms mean when researching home insurance? They become even more important when you start looking at coverages. On our associated pages, the terms are explained and demystified so you can make the decisions that work best for you and your family.

Act of God
An event or accident arising out of natural causes, with no human intervention, which could not have been prevented by any means. Examples: Lightning, Earthquakes, Tornadoes and Floods.

Actual Cash Value (ACV)
The actual value of property at the time of loss. It is less than replacement cost because depreciation decreases the value.

Additional Living Expense
When damage to or loss of home forces an insured to keep a temporary residence elsewhere in order to maintain a normal standard of living. Examples: Hotel accommodations, restaurant meals and laundry expenses.

An insurance company representative and adviser who sells insurance policies.
(See also: Independent Agent, Exclusive Agent and Direct Writer)

All Risks Policy
A policy which provides coverage against loss of or damage to property from any cause, except those that are specifically excluded in the policy.

The individual(s) who fill out and sign a written application for insurance.

A survey or an evaluation of property made to determine either the appropriate amount of insurance coverage or the amount of a loss to be paid.

Appurtenant Structure
Additional buildings like garages or barns, on the same premises as the main, insured building.

Arbitration Clause
Provides a means for settlement when you and your insurer cannot agree on an acceptable claim amount. Appraisers representing each party select a neutral arbitrator. A decision by any two of the three constitutes a binding settlement.

Authorized Service(r)
A technician assigned by a home protection plan to replace or repair covered equipment in the event of a breakdown.

Bodily Injury
Physical injury, cut, abrasion, bruise, burn or disfigurement; bodily harm, sickness or disease, caused to a person by an accident.

Failure of equipment covered by a home protection plan to perform properly under normal usage.

Broad Theft Coverage
A form on or endorsement to a dwelling policy that provides theft coverage for a named insured who is an owner occupant.

Building Code Upgrade
A coverage which brings the house up to local building code folowing a covered claim.

A trade, profession or occupation, whether it is full or part-time.

Business Personal Property
The equipment, fixtures, machinery, materials, merchandise and all other personal property owned by the insured and used in the insured´s business. Coverage is usually limited.

Termination of a contract of insurance before its expiration date by either the insurance company or the insured.

An unexpected severe event that causes a loss of extraordinary magnitude.

Civil Commotion
An uprising of a large number of people, usually resulting in damage to property. Generally covered under an Extended Coverage Endorsement.

A demand for payment to recover a loss protected by an insurance policy.

Co-Insurance Rule
See Eighty Percent Rule.

Provisions inserted in an insurance contract that set forth the rights, duties and responsibilities of the parties to an insurance contract.

Condo Association Coverage
A type of property insurance designed to cover the joint insurance needs of members of a condo association who collectively own property.

The amount of protection the insurance provides. This may mean either the dollar amount purchased or the type of loss covered.

Information from Deschutes Insurance

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