Actual Cash Value Valuation - This valuation method pays for the cost to repair or replace damaged property with like kind and quality, less reasonable deductions for wear and tear, deterioration and economic obsolescence.
Agreed Value Valuation - This coverage is used to remove the coinsurance requirement for covered property. With it your company agrees that the amount of coverage purchased is adequate, and any coinsurance requirements are waived if the limit of insurance equals the agreed value.
Basic Causes of Loss - Protection for the following causes of loss: fire, lightning, explosion, windstorm, hail smoke (except from agricultural smudging or industrial operations), aircraft, vehicles, riot, civil commotion, vandalism, sprinkler leakage, sinkhole collapse and volcanic action.
Blanket Coverage - A single limit of insurance that applies to two or more property items at one location, or to two or more kinds of property at several locations. It allows you to shift property values with no impairment of recovery, as long as the total amount of insurance carried complies with the coinsurance requirement stated in the policy.
Boiler & Machinery Insurance - Fired vessels, steam generators, mechanical and or electrical objects and turbines, are all examples of “objects” that might be listed for coverage under a boiler and machinery policy. Coverage is for damage to covered property caused by an accident to an object identified in the policy’s schedule. Coverage includes extra expense, automatic 90-day coverage at new locations, defense against liability claims, and supplementary payments like those provided under public liability policies. Also known as equipment breakdown.
Broad Causes of Loss - Protection for the following causes of loss: fire, lightning, explosion, windstorm, hail smoke (except from agricultural smudging or industrial operations), aircraft, vehicles, riot, civil commotion, vandalism, sprinkler leakage, sinkhole collapse. volcanic action, breakage of glass, falling objects, weight of snow, ice or sleet (except for damage to gutters, downspouts or personal property outside of buildings) and limited water damage.
Buildings - Permanent structures listed on the policy including completed additions, permanently installed fixtures, machinery and equipment, outdoor fixtures, owned personal property used to service, repair or maintain the building and additions under construction or repair.
Buildings Insurance - "First-party" insurance of real and personal property against physical loss or damage, not to be confused with property damage liability insurance.
Business Income - A time element coverage which pays for loss of earnings or income when business operations are interrupted, curtailed or suspended due to property loss as a result of an insured cause of loss. Also covered are losses of rent and rental value. Extra expenses incurred to continue operations at another location are included as long as they reduce the total amount of loss
Business Income Including Extra Expense - Coverage used to insure against loss of income (including any continuing normal operating expenses) that you experience because of a suspension of your business when insured property has been damaged by a covered peril. Extra Expenses are included and Rental Values can be added as an option.
Building Ordinance or Law - A property endorsement which provides the insured the option to purchase coverage for three types of common building ordinance or law requirements that apply after an insured has suffered a physical damage loss such as fire. These ordinance or law damages are normally excluded in standard property coverage forms. The coverages available in this endorsement are cost to demolish the undamaged portion of the building, cost to replace with superior construction as required by law, and cost to clear the land of debris after demolition.
Business Personal Property - Includes most property, other than real property, used in connection with the insured’s business operations.
Coinsurance - Clause requiring that the limit of coverage be a minimum percentage (usually 80%) of the insurable value of your property. If the amount of insurance carried is less than what is required by this clause, any claim payment may be reduced by the same percentage as the deficiency.
Deductible - The amount that will be deducted from any payment made to you because of a covered loss.
Demolition Cost - The cost that it takes to demolish the undamaged portion of the building because of an ordinance or law.
Difference In Conditions (DIC) - Property insurance obtained through the excess and surplus lines market to supplement and expand on the property coverage available through admitted markets.
Earthquake Coverage - Protection for loss due to earth movement including earthquake shocks and volcanic eruption.
Earth Movement - Subject to exclusion in property policies, this peril includes earthquake, landslide, mudflow, etc.
Extra expense insurance - Depending on an insured’s requirements, this coverage can be had as a supplement to business income insurance, applying to expediting expenses that aid in quickly restoring the insured’s operations after a covered loss, or it can be the primary coverage sustaining the extra cost of continuing doing business for those insureds who would find it extremely damaging to fail to meet customer commitments, e.g., newspapers, dairies, etc.
Flood Coverage - Protection against loss due to water damage arising from flooding, surface water, tides, tidal waves, and the overflow of any body of water.
Flood Insurance: Excess – Provides flood coverage excess (over) the primary flood coverage.
Flood Insurance: Primary - Coverage against damage done by the rising or overflowing of bodies of water. Flood insurance, like earthquake coverage, is usually only of interest to those relatively few whose property is exposed. Consequently, losses among this small group will be high and premiums can be prohibitive. However, in 1968 the Federal government stepped in to help property owners in designated “flood plains” with the National Flood Insurance Act of 1968. Coverage is not only available, but may even be required to obtain financing for exposed properties.
Glass Insurance - Coverage against the breakage of glass and frames. Check with your insured if there are any obstructions, which would prevent repair, such as lettering on the glass surface or ornamentation.
Increased Cost of Construction - Pays increased costs required by law to repair or reconstruct damaged and undamaged parts of the building. It also covers undamaged parts of a building that are not subject to a demolition order.
Leaseholders Interest Insurance - The insurable interest is that of a tenant who has some years remaining under a favorable lease that is subject to termination upon significant damage to the leased property.
Mold/Fungi – Typically not covered under standard policies. Specialty insurance needed to provide coverage, either direct damage to owned property or third party claims for bodily injury or property damage.
Off Premises Power Interruption - Property and time element endorsements designed to cover the insured for losses that result from the interruption of services by an insured cause of loss. The current endorsements allow the insured to select coverage for off-premises services, whether supplied by a private or public utility. Protection may be purchased for the following options, including water suppliers, communication suppliers, or power supplies.
Overhead Transmission Lines - This coverage is the excluded coverage part of the off premises power interruption coverage that allows you to insure for losses caused by damage to overhead transmission lines.
Personal Property - Personal property owned by your firm and used in your operations. Furniture and fixtures, equipment and machinery, raw stock, and finished goods all fall within this category.
Personal Property of Others - Covers personal property of others who are not insureds that is in the insured’s care, custody or control.
Rental Income - Insurance which reimburses a building owner against loss of rental income if the building is not usable by a tenant because of some cause of loss insured against. No longer a separate coverage form by itself; now incorporated into the inclusive business income coverage form.
Replacement Cost Valuation - This loss valuation method pays for the cost to repair or replace damaged items with like kind and quality without deduction for depreciation. This is important since you could face a substantial loss if you must replace property at today’s prices but receive only the depreciated value of the property that was destroyed.
Special Causes of Loss - Protection against direct loss arising from any cause not specifically excluded. The advantage of this form is that the insurance company must prove that a loss is specifically excluded in order to deny coverage under the policy.
Spoilage - Also called temperature change coverage protects perishable stock you have on your premises in case of damage caused by a temperature change due to an equipment breakdown or power failure.
Subsidence - This is protection if the land or property shifts underground and affects your property.
Tenants Betterments & Improvements - Fixtures, alterations, installations, or additions that a tenant acquired or made at his or her own expense. They are part of the building or structure occupied by the tenant and cannot be legally removed.