Unless otherwise specified in the policy, Actual Cash Value in California indicates Fair Market price. The Fair Market Value of an item is the dollar amount that a knowledgeable buyer (under no uncommon pressure) wants to pay and a well-informed seller (under no unusual pressure) is willing to accept.

Agent

A licensed individual or company licensed to sell and service insurance coverage for an insurance coverage company.

Aggregate Limit

The optimal dollar amount of protection 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 general aggregate for the complete policy term.

Agreed Value

A technique of loss assessment 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 guaranteeing important artwork, antiques, or traditional cars. An expert appraisal is normally required.

Arbitration Clause

A clause in an insurance plan that enables the insured and the insurer to each select an arbitrator if they can not concur upon an appropriate claim settlement. Once the arbitrators have actually been selected, they in turn appoint an independent umpire. If the arbitrators disagree, then the umpire chooses which declares settlement to support. The last choice is binding.

Betterment

A situation that happens in a loss when an old piece of residential or commercial property is replaced by a brand name new item. The insured is put in a much better monetary position than they were before the loss took place, and consequentially may need to pay the difference in rate for the betterment.

Binder

A short-term arrangement that offers short-term insurance coverage up until the policy can be released or delivered.

Broker

A licensed person or organization who offers and services insurance authorities in your place.

Broker-agent

A licensed person who can act as a representative representing one or more insurers, and likewise as a broker dealing with several insurance providers representing your interests.

Cancellation

The termination of an in-force insurance agreement by either the insured or the insurance company before its normal expiration date.

Claim

Notice to an insurance coverage company that a loss has happened that might be covered under the terms of the policy.

Claim Adjuster

The individual who assesses the damage triggered by a covered loss and identifies the total up to be paid under the policy terms.

Claims Made

A liability insurance coverage where protection applies to claims filed throughout the policy period no matter when the loss happened subject to a retroactive creation date.

Coinsurance

An insurance clause that specifies the amount of each loss that the business pays according to the quantity of insurance brought, divided by the amount of insurance coverage required. This basic formula associates with a contracted portion of protection that need to be required to avoid a coinsurance charge.

Combined Single Limit

When physical injury liability and residential or commercial property damage liability is expressed as a single sum (limitation) of protection.

Commercial Lines

Insurance protections for organizations, commercial organizations, and expert companies, as contrasted with individual insurance.

Commission

A part of the policy premium that is paid to an agent by the insurance provider as payment for the representative's work.

Concurrent Causation

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

Conditions

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

Consequential Bodily Injury

In Workers Compensation, special situations can arise 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 meanings.)

Coverage

Protection that is offered under an insurance coverage.

Declarations (DEC) Page

Usually the first page of an insurance coverage that consists of the full legal name of the insurance provider, the policy number, effective and expiration dates, premium payable, the quantity and types of protection, and the deductibles.

Deductible

The amount of the loss that the insured is responsible to pay before take advantage of the insurance coverage are payable.

Depreciation

The actual or accounting recognition of the decrease in value of residential or commercial property over a period of time according to a fixed schedule.

Dual Capacity

In Workers Compensation, a company might be accountable 2 ways to a staff member who incurs bodily injury on the task as an outcome of utilizing a service or product produced by that company. The worker is qualified for Workers Compensation advantages and might likewise sue the employer due to the fact that of the defectiveness of the injuring service or product.

Earned Premium

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

Endorsement

A written agreement that alters the regards to an insurance coverage by adding or deducting protection.

Effective Date

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

Exclusion

A contractual arrangement in an insurance coverage that rejects or restricts protection for specific hazards, persons, residential or commercial property, or areas.

Experience Modification

The adjustment of premium arising from using experience ranking. Experience rating plans reflect an insured's previous loss experience (normally from the past three years) and utilizes this experience to modify and identify the prem

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

First Party

The policyholder (insured) in an insurance coverage contract.

Flat Cancellation

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