Unless otherwise defined in the policy, Actual Cash Value in California means Fair Market Value. The Fair Market Value of an item is the dollar quantity that an educated buyer (under no unusual pressure) wants to pay and a well-informed seller (under no unusual pressure) is ready to accept.

Agent

A certified person or company authorized to sell and service insurance coverage policies for an insurance provider.

Aggregate Limit

The maximum dollar quantity of coverage in force for a residential or commercial property damage policy or liability policy. This optimum amount can be on a per incident basis or as a basic aggregate for the total policy term.

Agreed Value

A method of loss evaluation where the insured and the insurance provider list a concurred upon quantity to be paid in case of loss. This evaluation technique is most common in residential or commercial property insurance when guaranteeing important art work, antiques, or classic vehicles. An expert appraisal is usually needed.

Arbitration Clause

A provision in an insurance policy that permits the insured and the insurer to each designate an arbitrator if they can not concur upon an appropriate claim settlement. Once the arbitrators have been picked, they in turn appoint an independent umpire. If the arbitrators disagree, then the umpire decides which declares settlement to support. The decision is binding.

Betterment

A situation that occurs in a loss when an old piece of residential or commercial property is changed by a brand name brand-new item. The insured is put in a much better monetary position than they were before the loss happened, and consequentially might have to pay the difference in price for the betterment.

Binder

A short-term contract that provides temporary insurance coverage till the policy can be provided or delivered.

Broker

A licensed person or organization who sells and services insurance polices on your behalf.

Broker-agent

A licensed individual who can act as a representative representing several insurance providers, and likewise as a broker handling several insurance companies representing your interests.

Cancellation

The termination of an in-force insurance contract by either the insured or the insurer before its regular expiration date.

Claim

Notice to an insurance provider that a loss has taken place that may be covered under the terms of the policy.

Claim Adjuster

The individual who assesses the damage brought on by a covered loss and determines the amount to be paid under the policy terms.

Claims Made

A liability insurance coverage policy where coverage applies to claims submitted throughout the policy period anytime the loss happened based on a retroactive creation date.

Coinsurance

An insurance provision that defines the quantity of each loss that the business pays according to the quantity of insurance coverage carried, divided by the quantity of insurance coverage needed. This standard formula associates with a contracted portion of protection that should be required to avoid a coinsurance penalty.

Combined Single Limit

When physical injury liability and residential or commercial property damage liability is revealed as a single amount (limitation) of coverage.

Commercial Lines

Insurance protections for businesses, industrial institutions, and professional companies, as contrasted with personal insurance coverage.

Commission

A portion of the policy premium that is paid to an agent by the insurer as settlement for the representative's work.

Concurrent Causation

Occurs when 2 or more perils cause a loss. When only one of these perils is covered by the insurance coverage policy, the court generally rules that the entire loss is covered. Many insurance companies have reworded their policies to clarify that just a loss associated to a covered peril is certainly covered.

Conditions

The portion of an insurance agreement that states the rights and responsibilities of the insured and the insurer.

Consequential Bodily Injury

In Workers Compensation, special circumstances can occur when a job-related injury triggers some sort of non-work associated injury. (Please see Loss of Consortium, Dual Capacity, and Third Party Over glossary definitions.)

Coverage

Protection that is supplied under an insurance plan.

Declarations (DEC) Page

Usually the very first page of an insurance plan which contains the complete legal name of the insurance coverage business, the policy number, reliable and expiration dates, premium payable, the amount and types of protection, and the deductibles.

Deductible

The amount of the loss that the insured is accountable to pay before advantages from the insurance coverage policy are payable.

Depreciation

The real or accounting acknowledgment of the decline in worth of residential or commercial property over an amount of time according to a fixed schedule.

Dual Capacity

In Workers Compensation, a company may be accountable two methods to a worker who sustains physical injury on the task as an outcome of using a product or service produced by that employer. The employee is eligible for Workers Compensation advantages and might also sue the employer since of the defectiveness of the injuring services or product.

Earned Premium

The part of the policy premium paid by an insured that has actually been assigned to the insurance coverage business's loss experience, expenditures, and revenue year to date.

Endorsement

A written arrangement that alters the terms of an insurance coverage by including or subtracting protection.

Effective Date

The starting date of an insurance plan: the date the policy enters to force.

Exclusion

A contractual arrangement in an insurance plan that denies or limits coverage for particular hazards, persons, residential or commercial property, or places.

Experience Modification

The change of premium resulting from the use of experience rating. Experience rating plans show an insured's previous loss experience (normally from the previous three years) and uses this experience to customize and identify the prem

The termination date of coverage as indicated on an insurance plan.

First Party

The policyholder (insured) in an insurance coverage agreement.

Flat Cancellation

Cancellation that takes location on the policy efficient date. No premium charge is made