Missouri Property and Casualty Graded A+
Insurance Terms and Definitions - Absolute Liability: Liability arising from extreme dangers, such as explosives. Strict liability applies,
meaning no fault needs to be shown (e.g., owning a wild animal). - Accident: An unexpected event occurring at a sp...
Missouri Property and Casualty Graded A+
Insurance Terms and Definitions
- Absolute Liability: Liability arising from extreme dangers, such as explosives. Strict liability applies,
meaning no fault needs to be shown (e.g., owning a wild animal).
- Accident: An unexpected event occurring at a specific time and place.
- Actual Cash Value (ACV): Cost to replace property at the time of loss, minus depreciation; used for
reimbursement calculations.
- Additional Insured: A person or entity, apart from the Named Insured, covered by the policy in case of
loss.
- Additional Living Expenses: Coverage reimbursing increased living expenses due to loss of dwelling,
considered an indirect loss.
- Adjuster: An insurance company representative who assesses losses and determines liability.
- Admitted Company: An insurance company authorized to operate in a particular state by meeting
regulatory standards.
- Agent/Producer: An individual appointed to solicit, negotiate, or effect insurance contracts.
- Aggregate Limit: The maximum amount payable under a policy for all covered losses within a policy
period.
- Alien Company: An insurance company incorporated outside the U.S.
- Allied Lines: Property coverages often sold together with fire insurance (e.g., earthquake insurance).
, - All-Risk Insurance: Coverage that protects against loss from any peril except those specifically
excluded.
- Application: A form completed by a potential insured containing underwriting and rating information.
- Appraisal: A process for resolving disputes over the amount of a loss, involving the selection of
appraisers and a potentially binding umpire.
- Appurtenant Structure: Structures like tool sheds that are associated with the main insured property.
- Assigned Risk: Insurance provided to high-risk drivers through a state-mandated program.
- Audit: A review of an insured's financial records for premium calculation purposes.
- Bailee: A person temporarily holding the property of another; e.g., a dry cleaner.
- Bailee's Customer Policy: Insurance covering damage to customers' property in the bailee's custody.
- Binders: Temporary agreements providing interim coverage before a formal policy is issued.
- Blanket Position Bond: A fidelity bond with a single liability limit for each employee involved.
- Bodily Injury: Defined as physical harm, illness, or death caused during an incident.
- Boiler and Machinery Policy: Coverage for liability and property damage related to the use of boilers
and machinery.
- Bond: A promise by an insurance company to cover losses caused by others' actions.
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