property insurance glossary

The world of property insurance isn't exactly known for being jargon-free. From "act of God" to "umbrella insurance," check out these definitions and explanations that can help decode your property policy.

A

Act of God

In terms of insurance coverage, an act of God is an unpreventable natural occurrence that causes damage to your insured property. Examples include natural disasters and heavy storms.

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Actual cash value

An actual cash value policy (also known as an ACV policy) refers to a homeowners insurance settlement that provides coverage on the basis of the value at the time damaged or stolen. This may apply to a structure, component of the structure, or personal belongings. Since these materials aren't brand new, depreciation will be factored in when your insurer pays out your claim.

See also: depreciation, replacement cost

Actuary

An actuary is an insurance professional who analyzes various types of data and statistics to determine insurance risks and premiums.

See also: insurance score, insurance claim report

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Additional interest insured

Additional interest insured refers to another person or organization listed on and may be protected under a policyholder's homeowners insurance policy. If you're financing your home, you may need to list your mortgage company as an additional interest insured, as they may have an insurable interest in the property, or as extended protection by the policy.

See also: endorsement, insured, insurable interest, mortgager, mortgagee

Additional living expense coverage

If a covered incident damages your home, rendering it uninhabitable for a temporary period of time, additional living expense (ALE) coverage within your homeowners insurance policy may help pay for housing and any increased food costs to maintain equivalent living standards while your home is being repaired or rebuilt. For example, ALE could help cover a hotel or temporary housing while your home is being repaired from fire or storm damage.

See also: loss of use

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Adjuster

An adjuster (also known as a claims adjuster, field adjuster, or insurance adjuster) is an insurance professional who determines the monetary compensation an insurance company will pay a claimant. When someone files an insurance claim, an adjuster examines the damaged property and determines how much the insurance company should pay to repair the property and/or reimburse the claimant for his or her losses.

See also: claim, indemnity

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Agent

An agent (also known as an insurance agent) sells insurance coverage and helps manage customers' policies. Insurance agents are the authorized representatives of an insurance company or of multiple companies.

See also: broker, specialist

Apartment insurance

See renters insurance.

Attractive nuisance

An attractive nuisance is an element you add to your property that increases its value or fun factor, while also increasing your personal liability because kids or guests are more likely to be injured by it. Examples include swimming pools, trampolines, treehouses, playground equipment, and fountains or ponds.

See also: family liability protection, guest medical protection

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Automated Clearing House payments

Automated Clearing House payments (also known as ACH payments, automatic payments, or electronic payments) are electronic withdrawals from a policyholder's bank account or credit card used to pay insurance premiums or other types of bills.

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B

Betterment

Betterment is the act of property improvement. This term is often used in referencing changes made to a home — such as repairing a damaged roof — that increase its value and insurability.

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Binder

As a temporary authorization of insurance, a binder shows that coverage is in place (bound) for a specific amount of time, usually between 30 to 60 days. It will be replaced by a declarations page when the policy is issued.

When a policyholder requests a car or home loan, the loan company typically requires proof of insurance — which can be provided in the form of a signed binder.

See also: proof of insurance

Broad form

Broad form (also known as broadest insurance or broadform insurance) is an insurance policy that covers you and/or your property against every possible peril allowed by the insurer.

See also: peril, named peril, open peril, exclusions

Broker

A broker (also known as an insurance broker, independent insurance agent, or independent agent) is an independent insurance professional who helps clients obtain coverage that suits their needs by comparing offerings from multiple insurance companies. Rather than endorsing any particular company, a broker represents the consumer. A broker is knowledgeable in the practices and types of insurance offered by the companies he or she works with.

See also: agent, specialist

Building codes coverage

Typically an optional coverage on your homeowners insurance policy, building codes coverage pays the difference in cost if your home is damaged by a covered incident and requires more expensive repair or rebuilding costs in order to be aligned with city ordinances or newer building codes. Older homes are often required to be repaired or rebuilt with upgraded roofing materials, electrical equipment and wiring, and plumbing systems, for example.

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Building codes coverage for homeowners insurance

Bundling

Bundling (also known as combining policies) is the act of obtaining multiple types of insurance from the same company. Examples include combining homeowners and car insurance, or life, health, and home insurance. Because of multiple-policy discounts, bundling can result in substantial savings for the policyholder.

See also: home insurance

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Business use

See commercial use.

C

Casualty insurance

See property and casualty insurance.

Claim

A homeowners insurance claim is a policyholder's request to be reimbursed for a loss that's covered by homeowners insurance.

See also: adjuster, indemnity

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Commercial use

Commercial use classification (also known as business use) means that you use part of your home for business purposes, such as sales, a day care, esthetician work, client services, etc.

See also: primary use

Condominium insurance

Condominium insurance (also known as condo insurance) covers your personal property and the inside of your condo. Condo insurance also provides liability protection for bodily injury or property damage to others. Your condominium association will cover the building itself and the surrounding property.

See also: home insurance, renters insurance

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Continuously insured

The length of time you've been continuously insured is the number of years you've been covered by one or more insurance companies without a lapse in your homeowners insurance coverage.

Credit score

A credit score is a numerical value that represents how likely it is an individual will repay a loan or other debt on time.

The higher your credit score, the better chance you have of being approved for loans, credit cards, vehicle financing, etc. Factors such as bill payment history, credit history, debt-to-credit ratio, and many other financial details can positively or negatively affect your credit score.

See also: insurance score

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D

Declarations page

The declarations page (also known as a dec page) of your home insurance policy summarizes the information essential to your homeowners insurance coverage: your name and address, your lender's contact information, and the home insurance premium, as well as the policy's coverages, limits, and deductibles, and term length.

See also: policy jacket, binder

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Deductible

A deductible is the amount you agree to pay out of pocket before a certain coverage kicks in after you file a homeowners insurance claim. Generally, higher deductibles translate to lower premiums because you're assuming more of the financial risk in the event of a claim.

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Defensible space

Defensible space has to do with reducing fire risk near your home. Essentially, you keep the area around your property free from combustible materials, including vegetation, to maintain defensible space.

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Depreciation

Depreciation is the decline in an object's value due to age, wear and tear, or obsolescence.

See also: actual cash value, replacement cost

Direct homeowners insurance

Direct homeowners insurance (sometimes known as online insurance) lets consumers buy home insurance coverage directly through a company's website or over the phone rather than through an independent agent or broker.

See also: agent, broker, Esurance

DIY home inspection

In general, a DIY home inspection is pretty self-explanatory. But at Esurance, you can save a cool $50 on your homeowners policy by completing a home inspection using our easy-to-use app within 20 days of your policy's start date.

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Dwelling insurance

See home insurance.

E

Earth movement

Earth movement, in this context, is the movement of land (i.e. earthquakes, landslides, mudslides, sinkholes) due to natural and/or geological events.

See also: mine subsidence, sinkhole, earthquake insurance

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Earthquake insurance

Earthquake insurance is a type of coverage that can be added to a policyholder's homeowners, condo, or renters insurance for an additional premium. As the name implies, it covers damages caused by earthquakes and other earth movement, such as landslides.

Earthquake insurance typically doesn't include coverage for mine subsidence or sinkholes.

Most standard homeowners policies do not insure against earthquake damage unless this additional coverage is added to the policy.

See also: home insurance, renters insurance, condominium insurance, mine subsidence, earth movement, sinkhole

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Effective date

The effective date is the date your homeowners insurance coverage begins. You are not covered by a home insurance policy until the effective date, which you can select when you buy your policy.

See also: binder, policy jacket, proof of insurance

Endorsement

An endorsement, formerly known as a "rider," refers to any change made to your original insurance contract. Endorsements can adjust your contract from its base form to include or remove coverage (typically for high-value items like jewelry and furs, for example), or change provisions mid-term from your current contract.

See also: exclusions, limits, deductible

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ENERGY STAR®

The U.S. Environmental Protection Agency (EPA) implemented the ENERGY STAR label program in 1992 to identify and promote energy-efficient products, homes, and buildings. ENERGY STAR products include appliances, home office equipment, lighting, heating and cooling equipment, and consumer electronics — and typically lends to decreasing homeowners' energy use, resulting in lower utility bills and greenhouse gas emissions.

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Escrow

An escrow account is a type of savings account designed to hold money you're using to pay for homeowners-related expenses, such as property taxes and homeowners insurance. Instead of paying for these expenses in large lump sums, an escrow account — typically managed by your lender — parcels out the payments in smaller, periodic installments.

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Esurance

That's us. Esurance is a San Francisco-based insurance company that offers direct-to-consumer personal car and homeowners insurance. Our innovative approach to insurance allows customers to take advantage of affordable rates, great discounts, and a wealth of handy online tools.

We also help customers find affordable insurance in the states we don't operate in, and can help you find reliable car, home, renters, life, health, motorcycle, ATV, Segway golf cart, scooter, boat/PWC, travel trailer, RV, snowmobile, classic car, commercial auto, condo, flood, umbrella, pet, cell phone, and business insurance products.

See also: car insurance, homeowners insurance, direct homeowners insurance, renters insurance, condominium insurance

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Exclusions

Exclusions are situations that are not covered by a given insurance policy. Any specific exclusion will be stated in your homeowners insurance policy.

See also: policy jacket, named peril, open peril, peril

Extended premises coverage

An optional coverage on your homeowners insurance policy, extended premises coverage extends liability coverage to visitors on your property. It's often mandatory for 2-, 3-, and 4-unit homes, but it may also be useful for people with non-adjacent, vacant property.

F

Fair rental income protection

Fair rental income protection is an optional coverage on your homeowners insurance policy that reimburses lost revenue at market value if a space you rent out is uninhabitable after a covered loss.

See also: loss of use

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Family liability protection

A coverage that typically comes standard on most homeowners insurance policies, family liability protection (also known as homeowners liability coverage, liability insurance, etc.) covers homeowners' legal liability if their negligence leads to another person's injury or property damage. It can also cover legal defense if the homeowner is sued over said injury or property damage.

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Family member

For homeowners insurance purposes, a family member is someone who lives in the same home as the policyholder and is related by blood, marriage, or other recognized ties (like adoption, foster care, or wardship). Students living away from home may still be considered family members for insurance purposes.

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Fire department charges coverage

Fire department charges coverage can help cover the fee the fire department may charge when responding to a call at your home.

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Force-placed insurance

Since your mortgage company typically requires continuous homeowners insurance coverage as a condition of your loan, they may purchase insurance on your behalf if you let your homeowners insurance lapse — this is called force-placed insurance. Your lender will typically pay for the policy through your escrow account, which can raise your mortgage payments, since force-placed insurance policies are typically more expensive (and can cover less incidents) than typical home insurance.

See also: mortgager, lender

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G

Guest medical protection

If someone is injured on your property, guest medical protection on your homeowners insurance policy can help pay for their medical expenses. This coverage typically comes standard on your average home policy, and can help cover things like ambulance rides, X-rays, hospital stays, and surgical procedures. As the name implies, guest medical protection only extends to guests — not anyone who lives in the home.

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H

Hazard insurance

See home insurance.

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Home day care coverage

An optional coverage on your homeowners insurance policy, home day care coverage can help cover your personal liability and others' medical bills if you run an in-home day care, and an accident happens that results in your being legally responsible for paying the injuries.

See also: family liability protection, guest medical protection, commercial use

Home insurance

Home insurance (also known as hazard insurance, homeowners insurance, dwelling insurance, or house insurance) is a form of property and casualty insurance that covers the insured's primary residence. A home insurance policy generally offers coverage for liability, personal belongings, and damage to the primary structure as well as other structures — such as detached garages and storage buildings on the home's property.

A home insurance policyholder must own or be making mortgage payments on his or her home.

Those who rent their dwellings may protect their belongings by buying renters insurance.

See also: manufactured home insurance, renters insurance, condominium insurance, direct homeowners insurance, Esurance

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Home insurance calculator

A home insurance calculator helps you estimate how much coverage you may want to consider for your homeowners insurance policy before getting a quote.

See also: quote, limits

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Home inventory

A home inventory is essentially a documentation of your home and the belongings inside. It's important to create a thorough home inventory — including any receipts or other pertinent documents — in case you experience a theft or other loss. If you make renovations to your home, upgrade your appliances, or purchase additional items of value, it's key to update your home inventory so that you maintain a thorough documentation of your home and its contents at all times. This can significantly expedite the claims process and ensure you get the most out your home policy.

See also: claim

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Home warranty

A home warranty is generally a type of protection for household systems and appliances — like electrical wiring, garage door openers, plumbing, pools, dishwashers, smoke detectors, and AC units and heaters. A warranty is typically purchased by the seller of the house to help reassure potential buyers that these systems are covered should something happen once the keys are turned over. It's important to note that home warranties expire, and don't replace homeowners insurance, which covers a lot more in addition to your home's systems and appliances.

It's also important to mention that while home warranties cover failed systems and appliances, homeowners insurance can cover damage that is sudden and accidental.

See also: home insurance

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I

Identity theft expense coverage

Identity theft expense coverage (also known as identity theft insurance) is a standard, optional coverage on many homeowners insurance policies, and can come to your aid if you're ever a victim of identity theft. This coverage often offers services dedicated to repairing the damage done to your name and credit.

See also: credit score

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Increased building structure coverage

An optional coverage on your home policy, increased building structure coverage offers additional protection for your on-premises structures in the extreme cases when your original coverage limits aren't sufficient.

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Indemnity

An indemnity is the sum that your insurer will pay to you or others after an accident that results in damage to property or people. The idea is that it'll restore you to your pre-loss situation.

See also: claim

Independent insurance agent

See broker.

Insurable interest

An insurable interest exists when an insured individual or institution derives financial benefit from the continued, unimpaired, undamaged existence of insured property. For example, a mortgager has an insured interest in a mortgagee's home.

See also: mortgager, mortgagee, lender, insured

Insurance adjuster

See adjuster.

Insurance claim report

Insurance claim reports provide details about home insurance claims you've filed with insurance companies. These reports are provided by independent consumer reporting agencies that collect homeowners insurance claim information from a variety of insurance companies. One of the most common agencies issuing such reports is C.L.U.E., the Comprehensive Loss Underwriting Exchange.

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Insurance fraud

Insurance fraud (also known as an insurance scam) is any act that knowingly defrauds an insurance company to obtain payment. Fraud can take on many forms, ranging from overinflated repair bills, to staged fires and other incidents, to exaggerated claims of stolen property or damages.

Insurance fraud is a leading cause of today's rising insurance costs, and all states enforce strict laws against this form of crime. Convicted offenders can face major penalties, hefty fines, and imprisonment.

See also: claim, car insurance, home insurance, insurance claim report

Insurance score

Insurance scores are based on analytical models that objectively measure the relative likelihood of future insurance losses based on aspects of your credit history. These scores and analyses of their significance are provided by independent consumer reporting agencies.

See also: credit score

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Insured

An insured is an individual and/or institution covered by a homeowners insurance policy.

See also: insurable interest, mortgager, mortgagee, lender

Investment property

An investment property is any piece of real estate used to generate revenue for the owner. Examples of common investment properties include apartment complexes, rental houses, and vacation rentals.

See also: home insurance, renters insurance, landlord insurance

J

Judgment

A judgment is a final decision rendered by a court of law.

L

Landlord insurance

If you own a property that you rent out full-time, there's a good chance you'll need landlord insurance, which can help financially protect your personal liability, especially in the event of a tenant's (or their guests') injuries — which homeowners insurance likely won't cover. Landlord insurance also covers the structure itself, as well as the building's contents. If you're deemed responsible for others' medical expenses, or are ever taken to court over injuries or property damage, landlord insurance is typically the best option for helping to protect your finances.

See also: home insurance, condominium insurance, investment property

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Lender

A lender is any individual or organization that provides monetary loans. When someone obtains a loan, he or she must pay the lender back in full, with interest, within an agreed-upon period.

See also: mortgager, insurable interest

Life event

The term "life event" refers to an occurrence in life that significantly changes a person's status or living situation. Common examples of life events include marriage, divorce, serious medical diagnosis, disabling injury, pregnancy/childbirth, buying a house, and death of a spouse or close relative.

See also: endorsement

Limits

A limit is the maximum amount an insurance company will pay, per coverage, for each covered loss.

See also: home insurance, policy jacket, binder

Loss of use

A typical homeowners policy provides coverage for the loss of use of your home after a covered incident, which means payments for temporary housing, additional food expenses, and even transportation costs after your home is rendered temporarily unlivable. Loss of use coverage is also known as additional living expense coverage.

See also: additional living expense coverage

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Loss payee

A loss payee is a person or institution with a legal, insurable interest in a property. In the case of purchasing a home, the loss payee would typically be the mortgage company.

See also: insurable interest, mortgager

M

Manufactured home

A manufactured home is a factory-built home that meets the Manufactured Home Construction and Safety Standards set by the U.S. Department of Housing and Urban Development in 1976.

Unlike the mobile homes of the past, manufactured homes today come with many upgrades and can closely resemble a typical site-built home.

See also: manufactured home insurance, home insurance

Manufactured home insurance

Manufactured home insurance provides coverage for manufactured homes against sudden and accidental losses, including those caused by fires, theft, floods, hurricanes, tornadoes, earthquakes, vandalism, landslides, and more.

See also: mobile home, mobile home insurance, manufactured home

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Mine subsidence

Mine subsidence is the earth movement that results from the failure or collapse of underground mines, and often resembles sinkholes or troughs. Most homeowners insurance policies don't cover damage from mine subsidence, but some states have mandated that insurers make coverage available for residents who live in high-risk areas. Separate, standalone policies are also available.

See also: earth movement, sinkhole, earthquake insurance

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Mobile home

A mobile home is a factory-built home manufactured before the establishment of the Housing and Urban Development (HUD) code in 1976. Mobile homes are built on a chassis for easier transporting and usually require utilities hook-ups and anchoring.

See also: mobile home insurance, manufactured home, manufactured home insurance

Mobile home insurance

Mobile home insurance protects your mobile home and any attached structure(s) in the event of any direct, sudden, or accidental loss. Mobile home insurance also covers your personal belongings and provides personal liability protection.

See also: manufactured home insurance, manufactured home, mobile home

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Mortgagee

Also known as a lender or mortgage company, a mortgagee is an individual or institution — in this case, usually a bank — that provides mortgage loans.

See also: lender, mortgager

Mortgager

The borrower of a mortgage loan — in this case, the homeowner.

See also: mortgagee, insurable interest

N

Named peril

A named peril is a damage/loss risk specifically listed on your homeowners insurance policy. Named peril insurance specifies the threats the property is protected against, as opposed to open peril insurance, which guards against a general list of risks that are not excluded from the policy.

See also: peril, open peril, exclusions, home insurance

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Named insured

See primary policyholder.

O

Online insurance

See direct homeowners insurance.

Open peril

Open peril (also known as all-risk) is property insurance that protects your things from any and all types of damage, except those specifically named on your policy.

See also: named peril, peril, exclusions, home insurance

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Other structures coverage

Typically included as a standard coverage on home policies, other structures coverage insures the structures on your property not attached to the dwelling itself — like carports, fences, and storage sheds.

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Out-of-pocket expenses

Out-of-pocket expenses are what you pay in addition to what your home insurer pays when you file a claim. These are typically the result of the deductibles and coverage limits you choose.

See also: deductible, claim

P

Peril

A peril is anything that can cause damage or loss to your property. This can be a wide range of things, from wind to theft to smoke.

See also: named peril, open peril, exclusions, policy jacket, home insurance

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Personal liability

Personal liability (also known as personal obligation or personal responsibility) refers to a situation in which an individual is legally responsible for damages caused to another party or their property.

When someone is deemed personally liable, he or she is financially obligated to compensate the other party for damages in accordance with national and state liability laws.

Policyholders may carry personal liability coverage on their home insurance, car insurance, and virtually any other type of property and casualty insurance policy they own. Individuals may also purchase personal umbrella insurance in order to insure against liability situations not covered by their other insurance policies, and in excess of the base policy limits.

See also: family liability protection, medical payments coverage, umbrella insurance

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Personal property insurance

Personal property insurance is one of the foundational coverages of any homeowners insurance policy, and can financially protect you in the event that your belongings are stolen or damaged by a covered loss. This coverage typically protects your personal property at or away from home (for example, if your laptop is stolen from your vehicle).

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Policy

Your policy is the contract that states what your homeowners insurance coverage includes (coverages, limits, and deductibles), as well as your official annual premium.

It's a document or group of documents that typically includes a declarations page, a list of exclusions, and other terms and conditions of your coverage.

See also: car insurance, declarations page, homeowners insurance, policy jacket, binder

Policy expiration date

The policy expiration date is the date your insurance coverage ends if your policy isn't renewed.

The expiration date can be found on the declarations page of your homeowners insurance policy or on a recent homeowners insurance renewal notice.

See also: declarations page, binder, policy jacket, renewal letter

Policy jacket

A policy jacket is a brochure that contains all homeowners insurance policy language not contained in the declarations page and endorsements, including the exclusions, insuring agreements, definitions and conditions, and the premium.

See also: declarations page, endorsement, binder, exclusions

Policy term

A policy term is the length of time a homeowners insurance policy is valid. Home insurance policies from Esurance typically have a policy term of 12 months, depending on your state of residence.

See also: binder, policy jacket, declarations page, renewal letter

Premium

See rate.

Primary policyholder

The primary policyholder is the person who is billed for the homeowners insurance policy and who serves as the main point of contact with the insurance company.

See also: insured

Primary residence

The place you live more than 50 percent of the time.

Private mortgage insurance

Private mortgage insurance, or PMI, is designed to financially protect the lender if the homeowner stops making payments on the home loan. It's typically required if you have a conventional loan and make a down payment of less than 20 percent of the home's purchase price. It can also be required when you're refinancing with a conventional loan and your equity is less than 20 percent of the house's value.

The lender will usually set up PMI through a private insurer and add the premium to the mortgage payments.

See also: homeowners insurance, force-placed insurance

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Proof of insurance

Proof of insurance (also known as POI) is any legal, signed document provided by your insurance company that shows the effective date of your active insurance policy.

See also: declarations page, binder, policy jacket, renewal letter

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Proof of loss

A sworn proof of loss is a statement made by the homeowner to the insurance company in support of a claim. Generally it entails basic information about the loss and its monetary amount. A proof of loss form may include the date and cause of the loss, some documents that support the amount of the loss being claimed, and people who have a vested interest in the claim.

See also: home inventory, claim, insurable interest

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Property and casualty insurance

Property and casualty insurance (also known as P&C insurance) financially protects homes, condos, businesses, cars, and other assets against damages and loss. Property insurance generally protects the property itself while casualty insurance (often known as liability insurance) covers policyholders against legal liabilities caused by injury or property damage to others.

Generally speaking, property and casualty insurance differ from life and health insurance policies because they protect against liabilities not covered by other insurance policies.

See also: home insurance, renters insurance, condominium insurance, landlord insurance

Property insurance

See property and casualty insurance.

Q

Quote

A quote is an insurance premium estimate provided by an insurance agent, licensed insurance sales representative, or online engine. To receive the most accurate quote, provide honest, accurate information regarding your home, the area in which you live, etc.

See also: insurance claim report, rate, direct homeowners insurance, agent, broker, specialist, actuary

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R

Rate

A rate (also known as an insurance premium or premium) is the amount you pay for your insurance policy. Your rate can depend on many factors, including the size and type of your home, the state you live in, your claims history, and, in certain states, your credit-based insurance score.

See also: insurance score, insurance claim report, actuary, agent, broker, specialist, quote, binder, policy jacket, declarations page, renewal letter

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Renewal letter

A renewal letter (also known as a policy renewal or renewal slip) is a form that an insurer sends, by mail or electronically, to a policyholder just before the current policy term expires and the next one begins.

A renewal letter also states the premium for the upcoming term.

See also: binder, declarations page, policy jacket, policy term, rate

Renters insurance

Renters insurance (also known as renter's insurance or renters' insurance) typically covers you and your belongings against theft, vandalism, liability, and damages caused by hurricanes and fires. If you rent a house, condo, or apartment, renters insurance protects your personal effects, whether they're stored at home, taken with you on vacation, or packed in your car.

See also: home insurance, condominium insurance, landlord insurance

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Replacement cost

Replacement cost is the amount of money necessary to replace damaged, destroyed, or stolen property with a new item.

For example, if you carry replacement cost coverage on your home or renters insurance policy and a TV you bought several years ago is destroyed by a covered occurrence, your policy will pay you enough to purchase a brand new TV that's comparable.

If you have actual cash value coverage, on the other hand, your policy will pay an amount equal to the depreciated worth of your older model television, regardless of how much it might cost to replace it.

See also: actual cash value, depreciation, claim, indemnity

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S

Second home

A second home (also known as a vacation home or secondary residence) is any home you own that isn't your primary residence. Second homes are often used as vacation homes, guest houses, or rental properties.

See also: investment property

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Secondary coverage

Secondary coverage (also known as secondary insurance) helps pay for expenses and damages not already covered by your primary coverage.

See also: primary coverage, umbrella insurance, primary residence

Sinkhole

A sinkhole is a cavity in the ground caused by underground water erosion. A typical homeowners insurance policy doesn't cover damage from sinkholes, but some insurers offer a policy endorsement, while separate sinkhole insurance policies are also available.

See also: earth movement, earthquake insurance, mine subsidence

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Smartphone app

A smartphone app is a mobile software application that you can download and run through an app-capable mobile phone like an iPhone® or an Android™ device.

There are myriad smartphone apps, all designed to perform specified functions. A few common smartphone apps include those dedicated to GPS navigation, games, music, and organization. Esurance offers a free app for iPhone and Android that allows customers to manage policies and file a claim, for example.

See also: DIY home inspection

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Specialist

A specialist, when used as a term in the insurance field, refers to an insurance professional who possesses a distinct and advanced knowledge of a particular type of insurance or company practice. A shopper with in-depth questions regarding homeowners insurance options may seek the advice of a home insurance specialist.

See also: broker, agent

T

Total loss

A total loss, in the context of insurance, is a judgment by the insurer that the value or repair costs of damaged property exceeds the value of the policy.

See also: increased building structure coverage, loss of use, additional living expense coverage, fair rental income protection, claim, proof of loss

Trust

An arrangement in which someone's property or money is legally held or managed by someone else or by an organization (such as a bank) for usually a set period.

U

Umbrella insurance

Umbrella insurance (also known as personal umbrella insurance or a personal umbrella policy) provides personal liability coverage for situations not covered or inadequately covered by a policyholder's other insurance policies. Umbrella insurance can also cover court fees and legal costs in the event of a lawsuit.

See also: personal liability, bodily injury, medical payments coverage, secondary coverage

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Underwriter

An underwriter assesses submitted insurance applications and determines whether to provide coverage and, if so, under what terms.

See also: agent, broker, actuary

W

Water backup coverage

A standard coverage on the majority of home policies, water backup coverage (aka sewer backup coverage) can help repair damage from water that comes from the ground up, such as a broken sump pump or overflowing drain. It's important to note that this coverage is different from flood insurance, which isn't included in a standard home policy.

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