Comprehensive Coverage -The amount your insurance company will pay for hazards that are unrelated to a crash but that can damage your car (e.g. theft or vandalism, natural disaster, car fires). Often come with specific exclusions.
Deductible -The amount you pay out of your own pocket for covered expenses before the insurance company’s portion will be paid. Higher deductible = more out of pocket expenses
Actual cash value policy – the value once after depreciation when an item has gone down in value due to wear and tear overtime.
Replacement value – the cost to replace everything at today’s cost without depreciation.
Market value - includes the value of the land the home sits on and the cost of your home’s foundation—two expensive components of your home’s market value that don’t need to be insured, since most perils (think tornado or fire) are unlikely to ruin your lot or your foundation.
Depreciation – minimizing the value of an item due to the downgrade in value of wear and tear overtime.
Dwelling – your home or apartment
Coverage limit – an estimate of what it will cost to replace your home
CLUE - The CLUE database (Comprehensive Loss Underwriting Exchange) enables homeowner and automobile insurers to exchange information—without notice to you unless your state requires notice—about property claims
Risk - something that causes or may cause injury, loss, or destruction.
Peril – same as risk
Claim – contacting the insurer and reporting damage for review by an insurance adjuster to determine loss
Insurance adjuster - The adjuster’s job is to look over all of the damaged or destroyed property and provide an estimate of the cost to repair or replace the damaged or destroyed property.
Deductible – payment to insurance company to cover an initial amount of the claim.
Dwelling coverage - the house and everything connected to it
Personal property coverage - covers all of the “stuff” inside your house, condo, or apartment. Think of this as everything you would take with you if you moved out.
Other structures - covers any structures on your property that are not attached to your home, such as a greenhouse or detached garage or workshop.
Medical coverage - covers incidents that happen on your property, such as a babysitter injuring herself while she’s working at your home.
Scheduled personal property - things such as unique antiques or jewelry—valuable items that are above the policy limits and that are usually not subject to the policy deductible.
Personal Umbrella Policy - is called an “umbrella” policy because it provides liability coverage over and above your standard auto insurance or homeowners insurance. It offers protection for you and your family against large and potentially devastating liability claims or judgments against you. PUP policies often cover you and your family anywhere, not just on your property.
Did You Know
Flood and earthquake coverage are both separate types of insurance policies that need to be purchased separately. Only about 12% of homes in flood zones and 10% of homes in earthquake zones actually purchase this coverage.