Commonly Used Insurance Terms

Actual Cash Value: “ACV”. This is a term used by insurance companies to pay claims. It is generally known as being replacement cost of items less depreciation. It is the subject of much controversy in claims handling

Adjuster: A representative sent by an insurance company to interact with a person who has made a claim who is sent to evaluate the claim.

Appraisal: A process available under some insurance policies where there is an disagreement on the amount of the loss. Specific policies have controlling language and different jurisdictions allow for different processes.

Additional Living expenses: “ALE”. It is money you may be owed under your insurance policy if you need to vacate you property either due to a covered loss or necessary repairs due to a covered loss

Bad Faith: with respect to insurance this is known as unfair or deceptive practices by an insurance company and is the subject of a number of Florida Laws.

Claim: A request to an insurance company for payment pursuant to the policy.

Conditions: these are requirements that must be met by an insured who is seeking coverage.

Declarations: “Dec. Page”. Declarations are insurance forms that go with an insurance policy that give details of what coverage applies.

Direct Loss: damage that is a result of an occurrence or chain of events that results in coverage under the insurance policy.

Examination Under Oath (EUO): A process authorized by the policy of insurance where an insured, can be placed under oath and questioned by the insurance company, or it’s representative.

Independent Adjuster: This is a third party who is paid to adjust losses on behalf of an insurance company.

Insured: The person or entity covered by an insurance policy.

Insurer: A company that writes and sells insurance

Loss payment clause: A provision that can be found in most insurance policies. The provision addresses how and when claims are to be paid.

Policy: A written contract containing the terms and conditions of the insurance company’s obligations.

Premium: The amount paid for insurance coverage

Primary Insurance: Coverage that is first when more than one policy exists

Proof of Loss: A document detailing the claimed amount by an insured that is given to the insurer regarding a claim. A proof of loss is very important in a number of different ways and should be handled carefully. There submission of a proof of loss is very often a requirement to receive payment.

Provisions: Differing sections of an insurance policy

Public Adjuster: A licensed individual that adjusts insurance claims on behalf of insureds as opposed to insurance companies.

Replacement Cost Value: The cost of replacing property without a reduction for depreciation.

Term: The time during which an insurance policy is in effect.

Third Party: Someone other than the policyholder who has experienced loss or is entitled to be paid under the policy

Umpire: An umpire is typically an expert in the field of the repairs needed, who participates in the Appraisal process