Glossary Of Terms
Accidental Damage
Unexpected and unintentional damage caused by a sudden event. This is often an optional extra on policies like contents insurance.
Act of God
A natural event (e.g., flood, earthquake, storm) that is not caused by human action and is typically unpreventable. Many insurance policies have specific clauses related to Acts of God.
Actual Cash Value (ACV)
A method used of valuing insured property. It’s typically calculated as the replacement cost minus depreciation (wear and tear).
Additional Insured
A person or entity added to an insurance policy, extending coverage to them. This is common in landlord and tenant situations.
Adjuster (Claims Adjuster)
A person who investigates insurance claims, determines the extent of the insurance company’s liability, and negotiates claims settlements.
Agent (Insurance Agent)
A person authorised to sell insurance policies on behalf of an insurance company.
Aggregate Limit
The maximum amount an insurer will pay for all claims during a policy period.
Insurance Intermediary/Broker/Brokerage
An insurance professional or company that arranges and negotiates insurance policies for customers and businesses.
Buildings Insurance
Covers the physical structure of a building against damage or loss.
Business Contents Insurance
Covers items like furniture, equipment, documents, and cash from loss, damage, or theft.
Business Interruption Insurance
Provides cover for loss of income following an unexpected event that disrupts business operations (e.g., fire, flood, system downtime).
Cancellation
The cancellation of an insurance policy before its natural expiry date, either by the insurer or the policyholder.
Certificate of Insurance
A document providing evidence that insurance coverage is in place. It typically summarises key policy details.
Claim
A formal request to an insurance company for coverage or compensation for a loss or policy event.
Claims-Made Policy
A type of insurance policy that covers claims made during the active policy period, regardless of when the incident occurred.
Claims-Occurring Policy
A type of insurance policy that covers incidents that occurred during the policy period, regardless of when the claim is made.
Commercial Legal Protection
Covers compensation awards, professional fees, and legal costs associated with a range of legal disputes and tax inquiries.
Commission
The portion of the insurance premium paid to the insurance intermediary/broker for their services.
Conditions
Provisions in an insurance policy that outline the obligations of both the insured and the insurer. Failure to meet these conditions can void coverage.
Contents Insurance
Covers loss or damage to items within a property. This can be part of a home insurance policy (for personal belongings) or a business contents policy.
Contract Works Cover
This is designed to cover any damage to work that is underway, such as during construction.
Copyright Infringement
Using copyrighted material without permission, which can lead to legal claims.
Cover/Coverage
The protection provided by an insurance policy.
Crime/Specie Insurance
An insurance that can provide cover for the theft or damage of private keys, either held by an employee or third party.
Cyber Insurance (or Cyber Liability Insurance/Cybersecurity Insurance)
Protects businesses against financial, legal, and reputational impacts of data breaches, system downtime, cybercrime, or ransomware attacks.
Cybercrime Extension
Some policies offer this as an extension, covering financial losses caused by cyber fraud.
Directors’ and Officers’ Liability Insurance (D&O)
Covers claims made personally against a company’s directors or officers in connection with wrongful acts, mismanagement, allegations of neglect or breach of duty, misleading statements.
Employers’ Liability Insurance
Covers legal and compensation costs for claims made by employees for work-related injuries or illnesses. It’s a legal requirement for most UK businesses with employees.
Endorsement
A written amendment or addition to an insurance policy that modifies the coverage.
Exclusions
Specific situations, events, conditions, or types of losses that are not covered by an insurance policy.
Excess/Deductible
The amount the policyholder contributes towards each claim (also called “deductible”).
First-Party Coverage
Protects the policyholder directly (e.g., for damage to their own property or equipment).
General Liability
A broad term for insurance that covers a business’s liability to third parties, often including public and product liability.
Goods in Transit
Covers loss or damage to products, stock, and materials while they are being moved from one place to another.
Home Emergency Cover
Insurance to help deal with a sudden and unexpected emergency or breakdown at a property.
Indemnity
The principle that insurance should restore the policyholder to the financial position they were in before the loss occurred, but not make a profit.
Intellectual Property Insurance
Covers legal costs and damages related to infringement of intellectual property rights (copyrights, trademarks, patents, trade secrets).
Jurisdictional Limit
Defines the geographic area or legal jurisdiction within which the insurance policy will cover claims. For example, a policy might cover claims brought only in UK courts, but exclude claims brought in the USA and Canada.
Landlord Insurance
Insurance designed for landlords, covering risks associated with rental properties, including building damage, loss of rental income, and liability.
Lapse
Termination of an insurance policy due to non-payment of premiums.
Liability
Legal responsibility for damage or injury caused to another person or their property.
Limit of Liability (or Policy Limit)
The maximum amount an insurer will pay for a covered claim or series of claims within the policy period.
Lloyd’s Broker
A specialist insurance broker registered with Lloyd’s of London.
Loss Adjuster
An independent professional appointed by the insurer to investigate and assess complex or high-value claims.
Malpractice (Medical Malpractice)
Negligence by a professional, such as a doctor or healthcare provider, resulting in harm to a patient.
Material Fact
A fact that would influence an insurer’s decision to provide cover or set the terms and conditions of a policy. Failure to disclose a material fact can invalidate a policy.
Media Liability Insurance
Protects against claims related to content published online or offline, including intellectual property infringement, breach of confidentiality, and defamation.
Policy
The contract between the insured and the insurer, detailing the terms and conditions of the insurance coverage.
Policy Documents (Customer Documents)
The set of documents that form the contract between the insured and the insurer. It includes the policy wording, schedule, and any endorsements.
Policy Period
The duration for which an insurance policy is in force.
Policy Wording (Policy Terms and Conditions)
The section of an insurance policy that sets out the details of the cover, including what’s covered and any exclusions.
Premium
The amount of money paid for an insurance policy.
Professional Indemnity Insurance (PI) / Errors & Omissions (E&O)
Covers claims arising from mistakes, negligence, or omissions in the professional services or advice provided by a business.
Public Liability Insurance
Covers claims for injury or property damage to members of the public caused by your business activities.
Rent Guarantee Insurance
Designed to cover landlords for loss of rental income if tenants default on payments, or if there are disputes about repossession.
Reinstatement
Repairing or replacing damaged property to its original condition.
Renewal
The process of continuing an insurance policy for another policy term.
Risk
The possibility of a loss or event that the insurance policy covers.
Run-off Cover
Insurance that covers claims made after a business has ceased trading, related to work done while the policy was active.
Schedule
Part of an insurance policy that outlines the specific details of the insured, the cover provided, and any special terms or conditions. (forms part of the customers documentation)
Subrogation
The insurer’s right to pursue a third party that caused an insurance loss to the insured, in order to recover funds paid out in a claim.
Sum Insured
The maximum amount the insurer will pay for a covered loss. This can be for specific items (e.g., a piece of equipment) or an overall limit.
Technology Liability Insurance
Protects against allegations of a third party suffering financial loss from a technology service.
Third Party
A person or entity not directly party to an insurance contract but who may be affected by it (e.g., a customer who makes a claim against a business).
Third-Party Coverage
Protects the policyholder against claims made by someone else (a third party).
Underwriter
The insurance company or entity that evaluates the risk presented on the insurance policy and determines the terms and conditions, pricing and any special requirements of an insurance policy.
Wear and Tear
The natural deterioration of an item or property over time due to normal use. This is often excluded from insurance policies.
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