A–C
Actual Cash Value (ACV)
The estimated value of your property at the time of loss, factoring in depreciation. It reflects what the item is worth today, not its original cost.Adjuster
An insurance professional who investigates claims and determines how much the insurer should pay for a loss.Beneficiary
The person or organization designated to receive the insurance payout in the event of a claim, often used in life insurance.Binder
A temporary agreement that provides immediate insurance coverage until the official policy is issued.Claim
A formal request by a policyholder to an insurance company for coverage or compensation for a covered loss.Collision Coverage
Pays for damage to your vehicle resulting from a collision with another vehicle or object, regardless of fault.Comprehensive Coverage
Covers non-collision-related damages to your vehicle, such as theft, vandalism, fire, or natural disasters.Coverage
The amount and type of protection provided under an insurance policy for specific risks or losses.
D–F
Deductible
The amount you pay out of pocket before your insurance starts to cover costs.Endorsement
A change or addition to an existing insurance policy that modifies its terms or coverage.Exclusion
A condition or circumstance listed in the policy that is not covered by the insurance.Face Value
The dollar amount stated on a life insurance policy that will be paid to the beneficiary upon the insured's death.First-Party Claim
A claim filed by the policyholder against their own insurance policy.Flood Insurance
A separate policy that covers losses specifically caused by flooding, which is typically not included in standard homeowners insurance.Fraud
Intentionally providing false information to gain benefits or compensation from an insurance policy.Full Coverage
A term often used to describe a combination of liability, collision, and comprehensive insurance on a vehicle.
J–L
Joint Life Insurance
A life insurance policy that covers two people, typically spouses, and pays out upon the first death or sometimes the second.Lapse
The termination of an insurance policy due to non-payment of premiums within the grace period.Liability Coverage
Provides protection against claims resulting from injuries and damage to other people or property caused by the policyholder.Limit of Liability
The maximum amount an insurer will pay for a covered loss, as specified in the policy.Living Benefits
Features in some life insurance policies that allow the policyholder to access part of the death benefit while still alive, often for terminal illness or long-term care.Loss
A measurable financial setback due to a covered incident such as accident, theft, or disaster.Loss Ratio
A calculation used by insurers that compares the amount paid out in claims to the amount collected in premiums.
M–O
Medical Payments Coverage
Pays for medical expenses for you and your passengers after an accident, regardless of who was at fault.Named Peril
Specific risks or causes of loss that are explicitly listed and covered in an insurance policy (e.g., fire, theft, vandalism).No-Fault Insurance
A type of auto insurance that covers your own injuries and damages regardless of who caused the accident, reducing the need for litigation.Occurrence
An event that results in an insured loss. In liability insurance, coverage often depends on when the occurrence happened.Out-of-Pocket Maximum
The maximum amount a policyholder pays during a policy period before the insurer begins to pay 100% of covered costs (common in health insurance).Open Peril
A policy that covers all causes of loss except those specifically excluded, offering broader protection than named peril policies.Overinsured
When the amount of insurance coverage exceeds the actual value of the insured item or property.
P–R
Peril
A specific cause of loss or damage, such as fire, theft, windstorm, or flood. Policies may cover named or open perils.Personal Property
Items you own inside your home, like furniture, clothing, electronics, and appliances — typically covered under homeowners or renters insurance.Policy
The written contract between you and your insurer that outlines coverage details, terms, conditions, and exclusions.Policyholder
The individual or entity who owns the insurance policy and pays the premiums.Premium
The amount you pay to the insurance company for coverage — typically monthly, quarterly, or annually.Proof of Loss
A formal, written statement provided to an insurer detailing the amount of loss or damage, submitted to support a claim.Replacement Cost
The cost to replace an item or property with a new one of similar kind and quality, without deducting for depreciation.Rider
An optional add-on to an insurance policy that modifies or extends coverage for specific situations or items.Risk
The chance or probability of a loss occurring, used by insurers to determine premiums and eligibility.
S–U
Scheduled Personal Property
Additional coverage for high-value items like jewelry, fine art, or collectibles, listed (or “scheduled”) separately on your policy.Subrogation
The legal process by which your insurer seeks reimbursement from a third party after paying your claim, if that third party was responsible.Surcharge
An extra charge added to your insurance premium due to increased risk, such as traffic violations or claims history.Term Life Insurance
A life insurance policy that provides coverage for a specific period (e.g., 10, 20, or 30 years) and pays a benefit if death occurs within that term.Third-Party
Someone who is not the policyholder or insurer but may be involved in a claim, typically the injured party in liability coverage.Umbrella Policy
Extra liability insurance that provides additional coverage beyond the limits of your auto, homeowners, or other base policies.Underinsured Motorist Coverage
Covers injuries and property damage if you’re hit by a driver whose insurance is insufficient to cover your losses.Underwriting
The process insurers use to assess the risk of insuring a person or asset and to determine policy terms and pricing.Uninsured Motorist Coverage
Protects you if you're involved in an accident caused by a driver with no insurance or a hit-and-run.
V–Z
Valuation
The process of determining the worth of property or an item to decide how much insurance coverage is needed or what to pay after a loss.Variable Life Insurance
A type of life insurance that includes investment options, allowing the cash value and death benefit to fluctuate based on investment performance.Waiting Period
The time you must wait after your policy starts before coverage begins for specific benefits — common in health or disability insurance.Waiver of Premium
A policy feature that allows you to stop paying premiums if you become seriously ill or disabled, while keeping the policy active.Whole Life Insurance
A permanent life insurance policy that provides coverage for your entire life and builds cash value over time.Workers’ Compensation Insurance
Covers medical expenses and lost wages for employees who are injured or become ill due to job-related duties.Written Premium
The total premium amount an insurer records for policies issued during a specific time period, before subtracting cancellations or refunds.