Unless otherwise specified in the policy, Actual Cash Value in California indicates Fair Market Value. The Fair Market Value of an item is the dollar amount that an educated purchaser (under no uncommon pressure) is willing to pay and a well-informed seller (under no unusual pressure) wants to accept.
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Agent
A licensed person or company licensed to offer and service insurance coverage for an insurance company.
Aggregate Limit
The optimal dollar quantity of coverage in force for a residential or commercial property damage policy or liability policy. This maximum quantity can be figured on a per occurrence basis or as a basic aggregate for the complete policy term.
Agreed Value
A method of loss evaluation where the guaranteed and the insurer list an agreed upon total up to be paid in case of loss. This valuation approach is most common in residential or commercial property insurance when guaranteeing valuable art work, antiques, or classic autos. A professional appraisal is generally required.
Arbitration Clause
A clause in an insurance coverage that permits the insured and the insurance provider to each designate an arbitrator if they can not agree upon a suitable claim settlement. Once the arbitrators have actually been picked, they in turn select an independent umpire. If the arbitrators disagree, then the umpire decides which declares settlement to support. The final decision is binding.
Betterment
A situation that takes place 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 better monetary position than they were before the loss occurred, and consequentially may have to pay the distinction in cost for the betterment.
Binder
A short-term contract that supplies momentary insurance coverage till the policy can be released or provided.
Broker
A licensed person or company who offers and services insurance coverage cops on your behalf.
Broker-agent
A certified person who can serve as a representative representing several insurance providers, and likewise as a broker dealing with one or more insurance companies representing your interests.
Cancellation
The termination of an in-force insurance coverage agreement by either the guaranteed or the insurance provider before its regular expiration date.
Claim
Notice to an insurance coverage business that a loss has actually happened that might be covered under the conditions of the policy.
Claim Adjuster
The individual who examines 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 policy where protection uses to claims filed during the policy duration no matter when the loss took place based on a retroactive inception date.
Coinsurance
An insurance provision that specifies the quantity of each loss that the company pays according to the quantity of insurance coverage carried, divided by the amount of insurance required. This standard formula associates with a contracted percentage of protection that must be required to prevent 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 coverage.
Commercial Lines
Insurance protections for services, industrial organizations, and expert companies, as contrasted with personal insurance.
Commission
A part of the policy premium that is paid to an agent by the insurance provider as compensation for the agent's work.
Concurrent Causation
Occurs when two or more perils cause a loss. When only one of these hazards is covered by the insurance coverage policy, the court typically rules that the whole loss is covered. Many insurer have reworded their policies to clarify that just a loss attributed to a covered danger is certainly covered.
Conditions
The portion of an insurance contract that sets forth the rights and responsibilities of the insured and the insurance company.
Consequential Bodily Injury
In Workers Compensation, unique circumstances can occur when a work-related injury triggers some sort of non-work related injury. (Please see Loss of Consortium, Dual Capacity, and 3rd party Over glossary definitions.)
Coverage
Protection that is supplied under an insurance coverage.
Declarations (DEC) Page
Usually the very first page of an insurance coverage that consists of the complete legal name of the insurer, the policy number, effective and expiration dates, premium payable, the quantity and kinds of protection, and the deductibles.
Deductible
The amount of the loss that the insured is accountable to pay before benefits from the insurance policy are payable.
Depreciation
The actual or accounting recognition of the reduction in value of residential or commercial property over an amount of time according to an established schedule.
Dual Capacity
In Workers Compensation, a company may be accountable 2 ways to a worker who sustains bodily injury on the task as a result of using a product and services produced by that employer. The worker is qualified for Workers Compensation benefits and may also take legal action against the employer due to the fact that of the defectiveness of the hurting item or service.
Earned Premium
The portion of the policy premium paid by an insured that has actually been assigned to the insurer's loss experience, costs, and revenue year to date.
Endorsement
A written contract that alters the regards to an insurance plan by adding or deducting protection.
Effective Date
The starting date of an insurance coverage policy: the date the policy goes in to force.
Exclusion
A contractual provision in an insurance plan that rejects or restricts coverage for specific perils, persons, residential or commercial property, or areas.
Experience Modification
The adjustment of premium arising from the usage of experience score. Experience rating plans show an insured's past loss experience (normally from the previous 3 years) and uses this experience to modify and identify the prem
The termination date of protection as suggested on an insurance coverage policy.
First Party
The insurance policy holder (insured) in an insurance agreement.
Flat Cancellation
Cancellation that takes location on the policy efficient date. No premium charge is made; however, other charges (i.e., service) might use.
Fraud
An intentionally deceptive act devoted to get an unjust or unlawful advantage. Fraud typically involves financial gain.
Frequency
The number of times a loss happens.
Hazard
A circumstance that increases the probability or potential seriousness of a loss.
Indemnity
In a residential or commercial property and casualty agreement, the objective is to restore an insured to the exact same monetary position after the loss that the insured had prior to the loss. In one of the most fundamental sense, indemnity is compensation for a loss.
Independent Adjuster
A person or company that supplies claim adjusting services to various insurance companies on a contract basis.
Insurable Interest
Any interest (most typically ownership) that an individual, company, or corporation has in a topic of insurance such as a service, building, or automobile, which can be harmed and may cause the individual, business, or corporation financial loss or other concrete deprivation. Generally, an insurable interest must be shown when a policy is released and should exist at the time of loss.
Insurance
A technique of moving risk from a person, service, or company to an insurance business in exchange for the payment of premium. The insurer dedicates to be responsible for covered losses.
Insured
The policyholder(s) entitled to protection under an insurance coverage.
Insurer
The insurer who releases insurance coverage and agrees to pay for losses and provide covered benefits.
Insuring Agreement
The part of an insurance coverage agreement that explains what is covered. The guaranteeing agreement usually specifies the perils guaranteed versus, the person(s) and/or residential or commercial property covered, the residential or commercial property areas, and the duration of the agreement.
