Unless otherwise specified in the policy, Actual Cash Value in California indicates Fair Market Value. The Fair Market Value of an item is the dollar quantity that an educated purchaser (under no unusual pressure) is prepared to pay and an educated seller (under no uncommon pressure) is ready to accept.

Agent

A certified individual or organization authorized to offer and service insurance coverage for an insurance coverage company.

Aggregate Limit

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

Agreed Value

A technique of loss valuation where the insured and the insurance company list an agreed upon total up to be paid in case of loss. This evaluation approach is most common in residential or commercial property insurance coverage when insuring important artwork, antiques, or traditional autos. A professional appraisal is typically required.

Arbitration Clause

A stipulation in an insurance coverage that permits the insured and the insurance company to each designate an arbitrator if they can not concur upon a suitable claim settlement. Once the arbitrators have been picked, they in turn appoint an independent umpire. If the arbitrators disagree, then the umpire chooses which claims settlement to support. The decision is binding.

Betterment

A circumstance that occurs in a loss when an old piece of residential or commercial property is replaced by a brand name brand-new product. The insured is put in a much better monetary position than they were before the loss occurred, and consequentially might need to pay the distinction in cost for the betterment.

Binder

A short-term contract that supplies short-lived insurance coverage up until the policy can be issued or provided.

Broker

A licensed individual or company who sells and services insurance coverage polices in your place.

Broker-agent

A licensed individual who can serve as an agent representing one or more insurance providers, and likewise as a broker handling one or more insurers representing your interests.

Cancellation

The termination of an in-force insurance coverage contract by either the guaranteed or the insurance company before its regular expiration date.

Claim

Notice to an insurer that a loss has occurred that might be covered under the terms and conditions of the policy.

Claim Adjuster

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

Claims Made

A liability insurance coverage policy where protection uses to claims filed during the policy duration anytime the loss took place based on a retroactive creation date.

Coinsurance

An insurance coverage stipulation that specifies the quantity of each loss that the business pays according to the amount of insurance brought, divided by the amount of insurance coverage required. This standard formula connects to a contracted portion of coverage that need to be needed to avoid a coinsurance charge.

Combined Single Limit

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

Commercial Lines

Insurance coverages for organizations, industrial organizations, and expert organizations, as contrasted with personal insurance.

Commission

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

Concurrent Causation

Occurs when two or more perils cause a loss. When just one of these perils is covered by the insurance policy, the court usually rules that the entire loss is covered. Many insurance provider have reworded their policies to clarify that only a loss attributed to a covered danger is certainly covered.

Conditions

The part of an insurance contract that sets forth the rights and tasks of the insured and the insurance provider.

Consequential Bodily Injury

In Workers Compensation, special circumstances can occur when a job-related injury causes some sort of non-work associated injury. (Please see Loss of Consortium, Dual Capacity, and 3rd party Over glossary definitions.)

Coverage

Protection that is provided under an insurance coverage.

Declarations (DEC) Page

Usually the very first page of an insurance coverage policy that contains the complete legal name of the insurance coverage company, the policy number, effective and expiration dates, premium payable, the quantity and kinds of coverage, and the deductibles.

Deductible

The quantity of the loss that the insured is accountable to pay before benefits from the insurance coverage are payable.

Depreciation

The real or accounting acknowledgment of the decrease in value of residential or commercial property over a time period according to an established schedule.

Dual Capacity

In Workers Compensation, a company may be accountable two methods to a staff member who incurs physical injury on the job as a result of using a product and services produced by that company. The worker is eligible for Workers Compensation advantages and might likewise sue the company because of the defectiveness of the hurting services or product.

Earned Premium

The portion of the policy premium paid by an insured that has actually been allocated to the insurance provider's loss experience, expenses, and earnings year to date.

Endorsement

A written agreement that alters the terms of an insurance coverage by adding or deducting coverage.

Effective Date

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

Exclusion

A contractual arrangement in an insurance policy that rejects or limits protection for particular hazards, persons, residential or commercial property, or locations.

Experience Modification

The adjustment of premium arising from the use of experience ranking. Experience score strategies show an insured's previous loss experience (normally from the past three years) and utilizes this experience to modify and determine the prem

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

First Party

The insurance policy holder (insured) in an insurance agreement.

Flat Cancellation

Cancellation that takes location on the policy efficient date. No premium charge is made; nevertheless, other charges (i.e., service) may apply.

Fraud

A purposefully misleading act committed to get an unjust or illegal advantage. Fraud normally includes monetary gain.

Frequency

The number of times a loss happens.

Hazard

A situation that increases the possibility or prospective severity of a loss.

Indemnity

In a residential or commercial property and casualty agreement, the objective is to bring back an insured to the exact same financial position after the loss that the insured had prior to the loss. In the many fundamental sense, indemnity is payment for a loss.

Independent Adjuster

An individual or organization that provides claim adjusting services to different insurers on an agreement basis.

Insurable Interest

Any interest (most frequently ownership) that a person, company, or corporation has in a topic of insurance such as a company, structure, or auto, which can be damaged and might cause the individual, business, or corporation financial loss or other tangible deprivation. Generally, an insurable interest should be demonstrated when a policy is issued and must exist at the time of loss.

Insurance

A technique of shifting threat from a person, company, or company to an insurance business in exchange for the payment of premium. The insurer dedicates to be responsible for covered losses.

Insured

The policyholder(s) entitled to protection under an insurance coverage policy.

Insurer

The insurance company who issues insurance and accepts spend for losses and supply covered benefits.

Insuring Agreement

The part of an insurance coverage contract that describes what is covered. The insuring agreement normally specifies the hazards insured against, the person(s) and/or residential or commercial property covered, the residential or commercial property locations, and the duration of the agreement.