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Occupancy - In insurance, this term refers to the type and character of the use of property in question.
Occurrence - An event that results in an insured loss. In some lines of insurance, such as Liability, it is distinguished from accident in that the loss does not have to be sudden and fortuitous and can result from continuous or repeated exposure, which results in bodily injury or property damage neither expected nor intended by the insured.
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Partial Loss - A loss under an insurance policy which does not either (1) completely destroy or render worthless the insured property, or (2) exhaust the insurance applying thereto.
Peril – Cause of a possible loss. For example, fire, theft, or hail.
Personal Articles Floater - Provides all risk coverage, subject to reasonable exclusions for valuable items such as furs, jewellery, cameras, silverware, etc. Formerly insured under separate contracts. The items are generally listed by description and value. This can be contrasted to the personal effects floater.
Person Effects Floater – An inland marine policy covering world-wide except in the insured’s domicile, personal effects usually carried by a tourist. In two forms, “All Risk” or broad form and “Specified Perils” form.
Personal Injury - Injury other than bodily injury arising out of false arrest or detention, malicious prosecution, wrongful entry or eviction, libel or slander, or violation of a person’s right to privacy committed other than in the course of advertising, publishing, broadcasting or telecasting. Contrast with advertising injury.
Personal Property – Any property of an insured other than real property. Homeowner policies protect the personal property of family members, and commercial forms are used to protect many types of business personal property of an insured.
Personal Property Floater - A broad policy covering all personal property world-wide, including insured’s domicile.
Personal Property Limitations – Don’t assume everything you own is adequately insured by a standard homeowner’s policy. The typical homeowner’s policy provides only limited coverage for many expensive items. Extra coverage can be purchased separately.
Physical Damage - A generic term indicating actual damage to property.
Physical Hazard – The material, structural, or operational features of the risk itself, apart form the morale or moral hazards of the persons owning or managing it.
Pilferage – Petty theft, especially theft of articles in less than package lots.
Policy - Legal document issued to the insured setting out the terms of the contract of insurance.
Policy Expiration Date - The date when your current insurance policy expires. This date can be found on your current Declaration (or “DEC”) page, insurance identification card, or recent cancellation notice. This date is not to be confused with the date of your next payment or the date when your renewal payment is due.
Policy Limit - The maximum amount a policy will pay, either overall or under a particular coverage.
Policy Period (or Term) - The period during which the policy contract provides protection, e.g., six months or one or three years.
Policy Holder - The person (or persons) whose risk of financial loss from an insured peril is protected by the policy.
Preferred Risk – An insurance classification indicating a risk that is superior to the average risk on which the rate has been calculated and thus eligible for a reduced rate.
Premises - The particular location of property or a portion thereof as designated in a policy.
Premium – The amount of money an insurance company charges for insurance coverage.
Primary Residence - The place where you will reside for the majority of your policy term.
Professional Liability Insurance – Liability insurance to indemnify professionals, doctors, lawyers, architects, etc. for loss or expense resulting from claim on account of bodily injuries because of any malpractice, error, or mistake committed or alleged to have been committed by the insured in his profession.
Prohibited Risk – Any class of business, which an insurance company will not insure under any condition.
Proof of Loss – A formal statement made by the insured to the insurance company regarding a loss. The purpose of the proof of loss is to place before the company sufficient information concerning the loss to enable it to determine its liability under the policy.
Property Damage Liability – Pays when an insured person is legally liable for damage to the property of others caused by your vehicle or your operation of most non-owned vehicles. This coverage also pays for your legal defense costs if you are sued.
Property Insurance - Property Insurance indemnifies an insured whose property is stolen, damaged, or destroyed by a covered peril. The term property Insurance includes direct or indirect property losses covered in several lines of insurance.
Protection -
1. Term used interchangeable with the word “coverage” to denote the insurance provided under the terms of a policy.
2. Term used to indicate the existence of fire-fighting facilities in an area know as a “protected” area.
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Quote – An estimate of the cost of insurance, based on information supplied to the insurance company by the applicant.
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Rate - The per unit cost of insurance. (See also Premium).
Rated - Usually used in combination, rated-up or rated policy. A policy issued with an extra premium charge.
Reimbursement - Payment of an amount of money related to the amount of the loss to or on behalf of the insured upon the occurrence of a defined loss.
Reinstatement - Restoring a lapsed policy back in force. The reinstatement may be effective after the cancellation date, creating a lapse of coverage. Some companies require evidence of insurability and payment of past due premiums plus interest
Reinsurance –
1. A contract of indemnity against liability by which the insurance company procures another insurance to insure it against loss or liability by reason of the original insurance.
2. Insurance by one insurance company of all or part of a risk accepted by it with another insurance company which agrees to reimburse the insurance company for the portion of the claim reinsured. The insurance company obtaining the reinsurance is called the “ceding insurance company;” the insurance company issuing the reinsurance is called the “reinsurer.” A reinsurer may, in turn, seek reinsurance on some portion of the risk it has reinsured, a process know, as "retrocession."
Renewal - The continuation in full force and effect of something that is about to expire. With an insurance policy it is made either by the issuance of a new policy or renewal receipt or certificate, to take effect upon the expiration of the old policy.
Replacement Cost – The cost of replacing property without deduction for depreciation.
Rider - Usually know as an endorsement, a rider is an amendment to the policy used to add or delete coverage.
Risk -
1. A chance of loss.
2. A person or thing insured. (Impaired or substandard risk: An applicant whose physical condition or
moral habits do not meet the standard on which the rate is based).
Risk Management - Management of the pure risks to which a company might be subject. It involves analyzing all exposures to the possibility of loss and determining how to handle these exposures through such practices as avoiding the risk, retaining the risk, reducing the risk, or transferring the risk, usually by insurance.
Robbery - The felonious taking, either by force or by fear of force, of the personal property of another, commonly known as “hold-up.”
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Settlement – Usually, a policy benefit or claim payment. It connotes an agreement between both parties to the policy contract as to the amount and method of payment.
Subrogation – The right of an insurance company to step into the shoes of the party whom they compensate and sue any party whom the compensated party could have sued.
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Tenants Policy – A homeowners form, which is specifically designed for people who rent.
Theft – Any act of stealing. Theft includes larceny, burglary and robbery.
Third Party Insurance - Protection of the insured against liability for damage to or destruction of the bodies or property of others.
Total Loss - A loss of sufficient size so that it can be said there is nothing left of value. The complete destruction of the property. The term is also used to mean a loss requiring the maximum amount a policy will pay.
Transfer of Risk - Shifting all or part of a risk to another party. Insurance is the most common method of risk transfer, but other devices, such as hold harmless agreements, also transfer risk. One of the four major risk management techniques. See Risk Management.
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Umbrella Liability Policy – A policy that pays for liability losses in excess of those covered in homeowners.
Underwriter -
1. People trained in evaluating risks and determining the rates and coverage that will be used.
2. Agents especially a life insurance agent, who might qualify as a “field underwriter.
Underwriting – The process of evaluating a risk for the purpose of issuing insurance coverage on it.
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Vandalism – Physical damage to property by malicious mischief.
Valuation – Appraisal estimation of the value of an item.
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