Home Insurance Terms and Phrases To Know
Ready to buy your first home or purchase a new homeowner’s insurance policy? Make sure you know all these common home insurance terms before you do.
ACV (Actual Cash Value) – Total value of your property, also known as replacement cost.
Adjuster – Works for an insurer to evaluate any losses and settle policy claims.
Appraisal – An analyzation to determine property value or damage value. Usually used to resolve claim disputes.
Binder – Temporary proof of insurance.
Declarations Page – Shows the name and address of the insurer, the policy time period, the premium, and the coverage amount.
Earned Premium – A premium amount that has already been paid in advance.
Endorsement (or “rider”) – Agreement that expands upon (or limits) the policy’s benefits.
Escrow – Money held by a third party until policy conditions are met.
Exclusion – Denies coverage for any specific person, object, or place.
First-Party Claim – When you file a claim against your own policy.
Grace Period – The time during which the policy is still viable even when a payment was missed.
Inflation Protection – Automatically adjusts policy for changes in costs.
Market Value – Home value based more on the surrounding market than the quality of the home.
Peril – A specific loss (flood, fire, theft, etc.) that is covered under your policy.
Personal Property – Refers to anything other than land that you own. Can include your home or the objects within it.
Reinstatement – The act of “re-starting” your policy after a lapse in coverage, usually due to a missed payment.
Residual Market – Insurers outside of the standard market.
Single Interest Insurance – Coverage for a party with insurable interest (like a lender) who is not the homeowner.
Underwriter – The person who determines your premium and assembles your policy.
Unearned Premium – Any monies that you owed but no longer owe due to a policy cancellation.