Knowledge is power. If you’re familiar with the common industry insurance terms you’ll be better equipped to negotiate for the best renters insurance coverage.
Actual Cash Value (ACV) – Present property cash value. This is equal to the replacement cost minus depreciation.
Appraisal – An evaluation to determine the insurable value of property or to determine the amount of a loss.
Claim – A demand to recover for a loss covered by an insurance policy.
Conditions – The provisions of an insurance policy stating your rights and duties and those of the insurance company.
Coverage – A synonym for insurance, indicating specifically, how much protection the insurance provides. This may mean either the dollar amount purchased or the type of loss covered.
Deductible – The amount of money the policyholder agrees to pay toward the total amount of an insured loss before the insurance company pays.
Depreciation – The decrease in the value of property due to wear, tear and age.
Endorsement – An amendment attached to an insurance policy that adds to or changes the terms of the policy contract.
Exclusion – An event or type of loss that your insurance policy does not cover.
Liability Coverage – Insurance coverage for bodily injury and property damage.
Limit of Liability – The maximum amount of damages that you have to pay in the event of a loss.
Limits – The maximum amount of insurance that will be paid for a covered loss.
Replacement Cost on Contents – An endorsement that insures for actual replacement cost rather than actual cash value, which only covers the replace cost minus depreciation.
Rider (Endorsement) – A written form or statement that alters or restricts your insurance contract.
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