Glossary & Definitions
Admitted Company – An insurance company domiciled in and licensed to do business in a particular state.
Advertising Injury – This injury has to pars, Disparaging another person’s goods or services and infringing on someone else’s copyright, title or slogan.
Agreed Value – an agreement made between the insurer and insured at policy inception confirming that both parties agree that the limit of insurance set forth in the schedule of property is that item’s value, and that agreed upon value is the amount that will be paid by the insurer in the event of a total loss.
Bodily Injury (BI) – Includes injury to the body as well as disease and resulting in death.
Builder’s Risk – This is a specific policy designed for a building under construction.
Business Income / Business Interruption Insurance – Pays for loss of income due to a covered property loss
Cause of Loss – the actual type of event that causes the loss. Examples are: theft, collision, earthquake, flood, fire or mischief.
Certificate of Insurance – A short-form documentation of an insurance policy.
Claims-Made Policy – a liability insurance method covering losses from claims asserted against the insured during the policy period, regardless of whether the liability-imposing causes occurred during or prior to the policy period.
Collision – your vehicle’s impact with another vehicle or stationary object.
Declaration Page – The who, what, where of the insurance policy, anything that would be uniqe to that particular client.
Employment Practice Liability – A type of liability insurance covering wrongful acts arising from the employment process. The most frequent types of claims covered under such policies include: wrongful termination, discrimination, sexual harassment, and retaliation.
Hazard – A condition that increases the liklihood or likely size of a loss.
Host Liquor Liability – Liability for bodily injury (BI) or property damage (PD) arising out of the serving or distribution of alcoholic beverages by a party not engaged in this activity as a business enterprise. Host liquor liability exposures are insurable under standard general liability policies.
Insurable Interest – Demonstrating that one would suffer a financial loss if the property were damaged.
Indemnity – The insurer puts the insured back in the same shape they were in before the loss took place.
Liability Limits – the most an insurer will pay for any one loss.
Liquor Law Liability – Common law liability imposed on those selling alcoholic beverages, as well as the statutory liability established in some states, which is excluded in general liability policies.
Mutual Company – An insurance company that pays its dividends to policyholders.
Named Insured – The person named on the declaration page.
Other than Collision (Comp) – open peril coverage for damage to your car and includes things such as Theft, Contact with Animals, and Glass Breakage.
Personal Injury – injury to the mind or character of another.
Primary vs. Excess – 2 policies covering the same property but now they state that one policy must pay its entire limit first before the other policy pays. The first policy would be primary and the second policy would be excess.
Rating Services – Organizations that measure the financial strength of insurance companies (AM’s best).
Replacement Value – used in property insurance contracts, this is the amount it would take to replace the property with like property of the same quality and construction
Risk – The uncertainty of loss.
Stock Company – An insurance company that has shareholders.
Subrogation – the substitution of one party (insurer) for another party (insured) to pursue any rights the insured may have against a third party liable for a loss paid by the insurer.
Underinsured Motorists – designed to handle claims when the insured is injured by someone who does not have enough insurance.
Uninsured Motorists – designed to handle claims when the insured is injured by someone who has no insurance.
Unoccupied – Means no people but there is still some stuff.
Vacant – Means no people and no stuff.
Vicarious Liability – When one party is held responsible for the actions or conduct of another party based solely on the relationship of the two parties.
Workers’ Compensation – Protection which provides benefits to employees for any injury or contracted disease arising out of and in the course of employment. All states have laws which require such protection for workers and prescribe the length and amount of such benefits provided.