Definitions
ACTUAL CASH VALUE
An amount that limits the company's payment for a loss to what the damaged
item is worth today after considering its age, condition and normal wear and
tear. This value is determined by first finding out what it would cost to
replace the damaged item today with a new one, then deducting for wear and
use.
ADDITIONAL LIVING EXPENSES
Living expenses made necessary when your apartment cannot be occupied due
to damage caused by an insured peril. These expenses would be those above
and beyond your normal expenditures for food, utilities and rent.
CLAIM
A request for payment of a loss.
CONTRACT
A legal agreement between two parties. Insurance policies are contracts.
DECLARATION PAGE (Dec page)
The part of the policy describing who and what are covered, the address, effective
dates, policy term, applicable coverages, and the amount of coverage and the
premium.
DEDUCTIBLE
An amount you agree to pay before the insurance company pays for the loss.
ENDORSEMENT
Not a part of the original policy, an endorsement lists terms and conditions
which become legal parts of the insurance contract. Additional fees may be
charged for certain endorsements.
PRINCIPLE OF INDEMNITY
The promise to put the person back in the same financial condition as before
the loss.
LIABILITY INSURANCE
The type of insurance that pays for injury or damage to others because of
your legal responsibility.
NEGLIGENCE (Being negligent)
Legal responsibility that results from a person acting or not acting the way
an average person would in a similar situation.
PERIL
The cause of a possible loss, such as fire, windstorm, theft, explosion or
riot.
PERSONAL PROPERTY
The type of property that's usually movable and easily transported. Refers
to your "belongings". In simplest terms, everything other than real
property.
POLICY
The legal contract issued to you stating the agreement between you and the
insurance company.
PREMIUM
An amount of money paid to an insurance company in return for insurance protection.
REPLACEMENT COST ON CONTENTS
The cost to replace an item of property at its current value without a deduction
for wear or use.
