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Our Insurance Glossary is designed to help you better understand the terms and concepts commonly used in personal and professional insurance policies. Whether you’re exploring home, condo, auto, or business insurance, having a clear understanding of these terms can empower you to make informed decisions about your coverage. While we focus on property, liability, and specialty insurance, we do not offer life or health insurance. Browse through our glossary to clarify unfamiliar terms and feel more confident in choosing the right insurance for your needs. If you have any questions or need further clarification, our team at LoPriore Insurance is here to help!
An accident is an unexpected and unintentional event that causes damage or injury, often involving vehicles, property, or personal harm.
Accident Forgiveness is an auto insurance feature that prevents an insurance premium from increasing after the policyholder’s first at-fault accident.
An Act of God refers to natural events or disasters, such as hurricanes, floods, or earthquakes, that are beyond human control and can cause damage to property.
Actual Cash Value (ACV) is the value of an insured item, accounting for depreciation, often used in claims for car or property insurance.
An additional insured is a person or entity added to an insurance policy to extend coverage, often in business or property insurance.
Additional living expenses (ALE) coverage helps pay for temporary living costs if your home is uninhabitable due to a covered peril, such as fire or storm damage.
An adjuster is a professional responsible for investigating and assessing insurance claims to determine the extent of the insurer’s liability.
Advertising injury refers to harm caused by defamation, privacy violations, or intellectual property infringement that occurs in advertising or promotional activities.
Aftermarket parts are components made by a company other than the original manufacturer of the vehicle, used to replace or upgrade vehicle parts.
An agent is an individual or entity authorized to act on behalf of another, typically in the context of insurance, where they help clients purchase policies or manage claims.
Aggregate limit refers to the maximum amount of coverage an insurance policy will provide for all claims during a specific period, usually one year.
An Agreed Value Policy is an insurance policy where the insurer and policyholder agree on the value of the insured item upfront, guaranteeing the payout in case of a total loss.
An Anti-Theft Device is a tool or system designed to prevent unauthorized access or theft of a vehicle or property.
An application refers to a formal request or form submitted for the purpose of obtaining insurance coverage for personal or business purposes.
An appraisal is a professional evaluation of the value of a property, often used in insurance to determine coverage and premium rates.
Arbitration is a method of resolving disputes outside of courts, often used in insurance claims to settle disagreements between parties.
At-fault refers to the determination of responsibility for causing an accident or damage, typically used in auto insurance claims to assign liability.
An audit is a formal examination of an organization’s or individual’s accounts, transactions, and records to ensure accuracy and compliance.
Bailee Coverage is insurance protection for businesses that temporarily hold personal property belonging to others, covering damage or loss to the property.
A binder is a temporary insurance contract issued to provide immediate coverage until the formal policy is finalized.
What is Blanket Coverage? Blanket coverage is an insurance policy that protects more than one property type or multiple locations under a single policy limit. Instead of taking out individual policies for each property or
Bodily Injury Liability is a type of insurance coverage that helps pay for medical expenses, lost wages, and legal fees if you are found responsible for causing injury to another person in an accident.
A BOR, or Broker of Record Letter, is a document that authorizes a specific insurance broker to represent an individual or business in managing their insurance policies.
A broker is an intermediary who helps clients buy and manage insurance policies by comparing options from multiple providers to find the best coverage.
A bundle discount is a reduction in insurance premiums offered when an individual or business combines multiple insurance policies, like home and auto, under the same provider.
Bundling is a method where multiple insurance policies, such as home and auto insurance, are combined to save money through discounts.
A burglar/fire alarm system detects unauthorized entry and fire threats, protecting homes and businesses from theft and fire-related damages.
Business Income Insurance provides coverage for lost income when a business is unable to operate due to a covered property loss or event.
Business Interruption Insurance covers the loss of income a business may experience after a disaster or unexpected event that disrupts its normal operations.
Business personal property refers to the movable assets owned by a business, such as equipment, furniture, and inventory, that are essential to daily operations.
Business use refers to the utilization of a vehicle, property, or other asset for commercial purposes, including company operations, employee activities, or client services.
Cancellation is the termination of an insurance policy by either the insured or the insurer before its normal expiration date.
A captive agent is an insurance agent who works exclusively for one insurance company, selling only that company’s policies.
Casualty refers to a person or property that suffers damage, injury, or loss due to an accident or unexpected event.
A Certificate Holder is an individual or entity that receives proof of insurance coverage from the insured party, typically listed on an insurance policy.
A claim is a formal request made by an insured individual to their insurance company for compensation or coverage after an incident.
A claimant is the individual or party making a formal request for compensation under an insurance policy after suffering a loss or damage.
A claims adjuster is a professional responsible for assessing insurance claims, determining coverage, and calculating payouts based on policy terms.
Class code is a numerical identifier used to classify businesses or industries based on the type of work they perform, essential in determining insurance rates.
A Clue Report is a detailed document that provides information about an individual’s insurance claim history, primarily used in the auto and homeowners insurance sectors.
Co-insurance is a cost-sharing arrangement in insurance where the policyholder and the insurer split covered expenses based on a predetermined percentage after the deductible is met.
COI, or Certificate of Insurance, is a document used to prove that a person or business has insurance coverage, often required for liability or property protection.
A collision is an event where two or more objects, such as vehicles, come into contact with force, often resulting in damage or injury.
Combined Single Limit refers to a type of insurance policy limit that provides one total amount of coverage for both bodily injury and property damage claims.
Comprehensive insurance provides coverage for damage to a vehicle from non-collision incidents such as theft, vandalism, or natural disasters.
A compulsory limit refers to the minimum amount of insurance coverage required by law, often applied to auto insurance policies.
Contractual liability refers to the obligation one party assumes in a contract to indemnify or compensate another party for specific risks or damages.
Cost basis is the original value of an asset for tax purposes, typically used to determine capital gains or losses when the asset is sold.
Cyber Insurance is a type of coverage designed to protect businesses from internet-based risks, including data breaches and cyber-attacks.
Damages refer to financial compensation that one party must pay to another in the event of a loss or injury, often covered by insurance policies.
The Date of Loss is the specific day on which an event occurred that resulted in an insurance claim being filed.
A Declarations Page is a document that outlines the key details and coverage limits of an insurance policy, including premiums, insured property, and policyholder information.
Depreciation refers to the gradual loss of value of an asset over time, commonly due to wear and tear or obsolescence.
Diminished value refers to the reduced market value of a vehicle after it has been damaged and repaired, even if it is restored to perfect condition.
Direct bill refers to an arrangement where an insurance company bills the insured directly for premiums rather than through an agent or broker.
A Direction to Pay is a formal instruction from a policyholder to their insurance provider authorizing direct payment to a third party, such as a repair service or contractor.
A dwelling refers to the structure or residence where a person lives, such as a house or apartment, and is typically covered by homeowners or property insurance.
Earned premium refers to the portion of an insurance premium that applies to the coverage provided during a specific period of time.
The Effective Date refers to the specific day when an insurance policy officially begins and coverage is activated.
Endorsement is an additional document or amendment added to an insurance policy to modify its terms, coverage, or conditions.
Equipment Breakdown Coverage protects against the financial loss from unexpected equipment failures or breakdowns.
Escrow is a financial arrangement where a third party holds and regulates payment or assets until certain conditions are met, typically in real estate transactions.
An estimate is an approximation or calculation of the likely cost, value, or quantity of something, often used in insurance or repair evaluations.
Exclusion refers to specific conditions or circumstances that are not covered by an insurance policy.
Expense Ratio is the percentage of assets used for administrative and operational expenses in an investment, insurance, or mutual fund.
An expiration date is the final date that a policy or coverage remains valid, after which it is no longer in effect.
A Fair Plan is a type of insurance coverage designed for individuals who cannot secure insurance through standard markets due to high risk factors.
A field adjuster is an insurance professional who investigates and assesses damage claims in person, typically for property or vehicle insurance.
A Field Appraiser assesses the value of property or vehicles, often for insurance purposes, by conducting on-site evaluations.
A fire wall is a fire-resistant barrier used to prevent the spread of fire in buildings or structures, often included in property insurance considerations.
First Party Claims refer to insurance claims made by the policyholder directly to their own insurance company for covered losses.
Gap insurance is an optional auto insurance that covers the difference between a car’s actual cash value and the balance still owed on the loan or lease.
Garaging refers to the location where a vehicle is primarily parked or stored, which can impact car insurance rates.
Good Student Discounts offer reduced rates on car insurance for students who maintain good academic standing, encouraging responsible driving and study habits.
A grace period in insurance refers to the extra time given to pay a premium after the due date without losing coverage. It helps avoid lapses in policies.
Group Savings Plans are employer-sponsored financial programs that allow employees to save for future goals, such as retirement or education, often with tax benefits.
Hazard insurance protects homeowners against damage caused by specific hazards such as fires, storms, or other natural disasters.
Hold Back refers to a clause in insurance where a portion of the settlement payment is withheld until certain conditions are met, such as proof of repair or replacement.
A Hold Harmless Agreement is a legal contract in which one party agrees not to hold another party liable for any damages or injuries.
A household member is anyone living in the same residence, often considered for insurance purposes, such as homeowners or renters insurance policies.
Improvements and Betterments refer to upgrades or additions made by a tenant to a rental property that enhance its value or functionality.
Indemnification is the process by which one party provides compensation to another for any loss or damage incurred.
An Independent Adjuster is a professional hired to assess claims on behalf of insurance companies, but they work as independent contractors rather than company employees.
An inexperienced operator is someone with limited or no prior experience in operating specific equipment, machinery, or vehicles, posing potential safety and liability risks.
Inflation Guard is a feature in insurance policies that adjusts coverage to account for inflation, ensuring the policy’s value keeps pace with rising costs.
Insurable interest is a legal requirement that must be met to purchase insurance, ensuring that the policyholder stands to suffer a financial loss from the insured event.
Insurance discounts are reductions in the cost of insurance premiums offered to policyholders for various qualifying factors, such as safety features or loyalty.
Insurance fraud is the act of deliberately deceiving an insurance company to receive benefits, payments, or coverage that one is not entitled to.
An Insurance ID Card is a document that provides essential information about your insurance coverage, including policy details and proof of insurance.
An insurance score is a numerical rating used by insurers to assess the risk level of a policyholder based on their financial behavior and credit history.
The insured is the individual or entity covered under an insurance policy, receiving protection against specified risks or losses.
An insurer is a company that provides insurance coverage to individuals or businesses in exchange for premium payments.
Insurer Legal Liability refers to the legal responsibility of an insurance company to cover claims according to the terms of an insurance policy.
Intentional acts are deliberate actions taken by an individual that result in harm, damage, or loss, often impacting insurance claims and coverage.
A lapse occurs when an insurance policy is no longer in effect due to non-payment or failure to meet certain conditions outlined in the contract.
Liability refers to the legal responsibility for one’s actions or omissions, which may result in harm or damage to another person or property.
A lien is a legal claim or right against a property, often used as collateral for a debt or loan, which must be satisfied before ownership can transfer.
A lienholder is a person or entity that has a financial interest in a property until a debt or obligation is fulfilled.
Loss control refers to proactive measures taken to reduce the frequency and severity of insurance claims by minimizing potential risks.
Loss history is a record of past insurance claims made by an individual or business, used to assess future risk and determine insurance premiums.
Loss of use refers to the inability to live in or use your property due to damage or a covered peril under an insurance policy.
A loss payee is a party named on an insurance policy who is entitled to receive payments in the event of a loss involving the insured property.
Loss reserve is an estimate of the total amount an insurance company expects to pay for claims that have been reported but not yet settled.
Loss Runs are detailed reports generated by insurance companies that outline a policyholder’s claim history over a specified period.
Market value is the estimated amount an asset would sell for in the open market, commonly used in property and car insurance to determine coverage amounts.
Medical payments coverage helps cover medical expenses for injuries sustained by you or others in an accident, regardless of fault.
Misrepresentation is the act of providing false or misleading information, which can impact insurance claims and policy agreements.
Mitigation refers to the actions taken to reduce or minimize the severity and impact of a risk or loss, especially in insurance contexts.
A Modification Factor is a numerical value used to adjust insurance premiums based on specific risks associated with a policyholder.
Monoline refers to an insurance policy or insurer that specializes in providing coverage for only one type of risk or insurance product.
A Multi-Car Discount is a price reduction offered by auto insurance providers to policyholders who insure more than one vehicle under the same policy.
An MVR (Motor Vehicle Report) is a record of a driver’s past driving history, often used in the insurance industry to assess risk for auto insurance policies.
Named Insured refers to the individual or entity explicitly listed on an insurance policy as the primary policyholder.
Negligence is the failure to exercise appropriate care, resulting in damage or injury, and it is a common factor in personal and business insurance claims.
Non-renewal is when an insurance company decides not to renew a policy after its current term ends, often due to claims history or changes in risk.
Occurrence is an event or incident that triggers a claim under an insurance policy, usually referring to accidents or losses during a specific time.
OEM stands for Original Equipment Manufacturer Parts, referring to components made by the original manufacturer of the equipment or vehicle.
An operator is a person or entity responsible for the use or control of a machine, vehicle, or system, often involving safety and legal responsibilities.
Operators are individuals trained to manage and handle tasks in high-risk environments, often involving specialized equipment or systems.
Ordinance of Law is a coverage clause in property insurance policies that helps cover costs for rebuilding or repairs required to comply with new building codes or regulations.
Other Structures refers to additional constructions on a property that are separate from the primary dwelling, such as sheds, detached garages, or fences.
A passive restraint system automatically protects vehicle occupants without any action needed by the user, commonly found in airbags and automatic seat belts.
A Per Occurrence Limit is the maximum amount an insurance company will pay for a single claim or incident under a policy.
Peril refers to an event or circumstance that causes damage or loss, which can affect property or assets covered under an insurance policy.
Personal liability refers to the legal responsibility an individual holds for any harm or damage they may cause to others, whether intentional or accidental.
Personal property refers to movable possessions or assets that are owned by an individual, which are not permanently attached to real estate.
Physical damage refers to any tangible harm or destruction inflicted on property, such as a vehicle or building, that may be covered by insurance.
PIP is an insurance coverage that helps pay for medical expenses, lost wages, and other related costs resulting from an auto accident, regardless of fault.
A policy is a formal contract between an insurance company and a policyholder, outlining the terms of coverage and the obligations of both parties.
A policy change refers to any modification made to an existing insurance policy that alters its terms, coverage, or premiums.
Policy conditions are the specific terms and requirements within an insurance contract that must be met for the policy to remain in effect.
A policyholder is an individual or entity who owns an insurance policy and is responsible for paying the premiums.
A premium is the amount paid by an individual or business to an insurance company in exchange for coverage.
A premium audit is a review of the policyholder’s records to ensure the correct insurance premium is charged based on actual business operations.
Primary use refers to the main or intended function of an asset, property, or vehicle within the context of an insurance policy.
Proof of Loss is a formal statement provided by a policyholder to an insurance company to initiate a claim for reimbursement after a covered loss occurs.
Property damage refers to harm or destruction caused to physical property, including homes, vehicles, and other assets, due to accidents, disasters, or vandalism.
A public adjuster is a professional who assists policyholders in negotiating and settling insurance claims to ensure they receive the best compensation possible.
A rate refers to the cost per unit of insurance coverage, often expressed as a premium amount, which can vary based on factors such as risk and coverage needs.
A rating plan is a method used by insurance companies to determine the premium rates for policies based on various risk factors and classifications.
Registration refers to the process of officially recording an individual, property, or item, such as a vehicle, with the relevant authorities or agencies.
Reinstatement is the process of restoring an insurance policy after it has lapsed due to non-payment or other reasons.
Rental Re-imbursement is coverage that provides compensation for renting a vehicle while your insured car is being repaired due to a covered loss.
Replacement cost refers to the amount of money it would take to replace a damaged or destroyed item or property with a similar one at current market prices.
Replacement parts refer to specific components used to fix or enhance machinery, vehicles, or equipment after the original part has failed or worn out.
Retained Limits refer to the amount of risk or liability an individual or business agrees to handle before their insurance coverage begins.
Retention refers to the amount of risk that a person or business chooses to retain, rather than transferring it to an insurance company through a policy.
A rider is an additional provision or amendment attached to an insurance policy to modify or expand its coverage.
Risk refers to the possibility of loss, injury, or other adverse outcomes resulting from uncertain events or situations, particularly in the context of insurance.
Salvage refers to the remaining value of a property or vehicle after it has been damaged and considered a total loss by an insurance company.
A Special Investigations Unit (SIU) is a team within an insurance company dedicated to detecting and preventing fraud in claims processes.
SR-22 is a certificate of financial responsibility that proves a driver has the necessary auto insurance coverage, often required after certain driving violations.
Stop Loss is a financial mechanism designed to limit the potential loss on an investment or insurance claim by setting a predetermined threshold.
Subrogation is the legal right for an insurance company to pursue a third party that caused an insurance loss to the insured.
Substitute transportation is a temporary solution provided by insurance when the insured vehicle is unavailable due to a covered loss.
Sump over water backup coverage is a type of insurance that protects homeowners against water damage caused by the overflow of a sump pump or sewer backup.
A supplemental estimate is an additional estimate provided after the initial one, often due to unexpected costs or damages discovered later.
A surcharge is an additional fee added to an insurance policy, often due to claims history or risk factors associated with the insured individual or property.
Theft refers to the unlawful taking of another person’s property without consent, with the intent to permanently deprive them of it.
Third-party claims refer to claims made by someone other than the insured, typically when the insured is held responsible for causing damage or injury.
A title is a legal document establishing a person or business as the legal owner of a vehicle or vessel.
A tort is a legal wrongdoing where one party’s action or inaction causes harm to another, leading to civil liability and potential compensation.
Total loss is when the cost of repairing a damaged property exceeds its value, leading insurers to declare it irreparable or uneconomical to fix.
Totaled refers to a vehicle declared a total loss after an accident, where the cost of repairs exceeds its market value or a specific threshold.
Towing and Labor Coverage helps cover the cost of towing and roadside assistance in the event of a vehicle breakdown.
Underwriting is the process by which an insurance company evaluates and assesses the risk of insuring a person or property before offering coverage.
Vandalism is the intentional destruction or defacement of property, often resulting in financial and legal consequences for both individuals and businesses.
VIN, or Vehicle Identification Number, is a unique code assigned to every motor vehicle when it’s manufactured, used for identification and tracking.
A waiver of subrogation is a clause that prevents an insurance company from seeking reimbursement from a third party responsible for a loss.
A warranty is a guarantee provided by a seller or manufacturer ensuring that a product or service meets certain standards or will be repaired or replaced if issues arise within a specified period.
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