Unless otherwise specified in the policy, Actual Cash Value in California implies Fair Market Value. The Fair Market Price of a product is the dollar amount that a knowledgeable purchaser (under no uncommon pressure) is prepared to pay and an experienced seller (under no uncommon pressure) wants to accept.

Agent
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A licensed person or company authorized to offer and service insurance policies for an insurer.

Aggregate Limit

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

Agreed Value

An approach of loss valuation where the insured and the insurer list a concurred upon quantity to be paid in case of loss. This appraisal approach is most common in residential or commercial property insurance when insuring valuable artwork, antiques, or classic automobiles. An expert appraisal is generally required.

Arbitration Clause

A clause in an insurance plan that allows the insured and the insurer to each select an arbitrator if they can not agree upon a proper claim settlement. Once the arbitrators have actually been chosen, they in turn select an independent umpire. If the arbitrators disagree, then the umpire decides which claims settlement to support. The final decision is binding.

Betterment

A scenario that takes place in a loss when an old piece of residential or commercial property is changed by a brand new item. The insured is put in a better monetary position than they were before the loss happened, and consequentially may have to pay the distinction in cost for the betterment.

Binder

A short-term agreement that supplies temporary insurance coverage till the policy can be issued or delivered.

Broker

A certified person or company who sells and services insurance coverage polices on your behalf.

Broker-agent

A certified person who can function as an agent representing several insurers, and likewise as a broker dealing with several insurers representing your interests.

Cancellation

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

Claim

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

Claim Adjuster

The person who evaluates the damage triggered by a covered loss and identifies the quantity to be paid under the policy terms.

Claims Made

A liability insurance coverage where coverage uses to claims submitted throughout the policy period no matter when the loss happened subject to a retroactive inception date.

Coinsurance

An insurance provision that specifies the amount of each loss that the company pays according to the quantity of insurance coverage brought, divided by the amount of insurance required. This basic formula connects to a contracted portion of protection that need to be needed to prevent a coinsurance penalty.

Combined Single Limit

When bodily injury liability and residential or commercial property damage liability is expressed as a single amount (limit) of coverage.

Commercial Lines

Insurance coverages for services, business organizations, and professional companies, as contrasted with individual insurance coverage.

Commission

A part of the policy premium that is paid to a representative by the insurer as compensation for the representative's work.

Concurrent Causation

Occurs when two or more perils trigger a loss. When just one of these dangers is covered by the insurance coverage, the court normally rules that the entire loss is covered. Many insurance companies have reworded their policies to clarify that only a loss credited to a covered peril is indeed covered.

Conditions

The portion of an insurance agreement that sets forth the rights and tasks of the insured and the insurance company.

Consequential Bodily Injury

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

Coverage

Protection that is provided under an insurance coverage.

Declarations (DEC) Page

Usually the first page of an insurance coverage that includes the complete legal name of the insurer, the policy number, efficient 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 gain from the insurance coverage are payable.

Depreciation

The actual or accounting recognition of the reduction in value of residential or commercial property over a duration of time according to an established schedule.

Dual Capacity

In Workers Compensation, an employer may be 2 ways to a worker who incurs bodily injury on the task as a result of using a product and services produced by that company. The worker is eligible for Workers Compensation benefits and might likewise sue the employer since of the defectiveness of the hurting item or service.

Earned Premium

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

Endorsement

A written agreement that changes the regards to an insurance plan by including or deducting coverage.

Effective Date

The starting date of an insurance plan: the date the policy goes in to require.

Exclusion

A contractual provision in an insurance plan that rejects or restricts coverage for specific perils, individuals, residential or commercial property, or places.

Experience Modification

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

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

First Party

The policyholder (insured) in an insurance coverage contract.

Flat Cancellation

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