Glossary

Additional Living Expense – Insurance covering the cost of you having to live elsewhere while work is undergone on your property.

Arbitration Clause – Clause in your insurance which states that if neither you nor your insurer can agree on an “appropriate claim settlement” you both hire an appraiser. These appraisers elect and independent umpire who is neutral to both parties. A majority decision will decide the amount of the claim.

Binder – A temporary or provisional form of cover until an actual policy can be written or delivered.

Claim – A demand for payment either for an actual or estimated amount of loss.

Conditions – The section of an insurance policy where it explains your obligations and the obligations of your insurance policy. Here is where information on the actions you are required to take to keep your policy valid can be found.

Depreciation – The reduction in value of any part of your property, or item you possess over time.

Exclusions – The events which your insurance policy does not cover.

Hazard – A situation or event that increases the likelihood of loss or the extent of that loss.

Inflation guard coverage – An automatic raise in the coverage limits of your policy to take into account increases in the costs of labour and building materials.

Liability Insurance – Insurance which pays out for injuries or damage to another person’s property.

Non-Renewal – A policy that does not continue after the expiry date.

Peril – The cause of a loss or damage to property, this can include fire, flood, storms etc. or they may be classed separately under your policy.

Premium – The amount that you pay for your insurance policy.

Replacement Cost Coverage – How much it will cost to replace a stolen or damaged item with a comparable new item.

Settlement – The cash amount that your insurance company agrees to pay

Underwriting – The method by which an insurance company determines how insurable your property is for several pre-determined criteria.