Annual Aggregate
The maximum dollar amount that can be paid under a policy during a one year
period.
All-Risk
Insurance against loss or damage to property from any cause, except those
that are specifically excluded.
Binder
An acknowledgement that insurance applied for is in force whether or not
premium has been paid or the policy issued.
Blanket Property Coverage
Covers business property under a single dollar amount of coverage as opposed
to insuring each item separately, i.e., Electronic Equipment and Media
blanket coverage.
Bodily Injury Liability Insurance
Protection against the liability which may arise from the injury or death of
another person. Written in conjunction with Property Damage Liability
Insurance.
Business Interruption Insurance
A type of policy that pays for loss of earnings when operations are
curtailed or suspended because of a covered property loss.
Business Personal Property (Contents)
Furniture, fixtures, equipment, machinery, merchandise, materials and all
other property (excluding real estate) owned by you and used in your
business.
Carrier
The insurance company that issues the policy and provides coverage.
Certificate of Insurance
A statement summarizing the types of coverage, amounts of coverage and
policy effective dates and which indicates that the certificate holder
(usually your client) will be notified if a policy cancels.
Claim
The demand for benefits as provided by the policy.
Claims-Made Coverage
A policy providing coverage only if a claim is made during the policy
period. If the policy has a retroactive date, a loss that occurred before
that date is not covered. Contrast with Occurrence Coverage.
Consequential Damages
Loss of revenue or productivity suffered by your customer due to your
alleged failure to deliver services as promised.
Effective Date
The date on which a policy goes into effect.
Electronic Data Processing Coverage
Specialized type of insurance designed to cover your computer equipment,
data systems, information storage media and expenses or income loss related
to the destruction of hardware or software.
Employee Dishonesty
Protection against allegations of employee theft of tangible or intangible
property from a client. Coverage should be provided on your premises and at
the customer's location.
Employer's Non-Owned Auto Liability
Liability the employer is exposed to when an employee uses his own personal
vehicle on company business.
Errors and Omissions Coverage
Protection against claims that you or your employee made mistakes through
error or oversight that caused a loss of productivity or loss of revenue on
the part of your client.
Exclusions
Causes of loss, conditions or property listed in the policy which are not
covered.
Expiration
The date on which a policy will cease to cover, unless previously canceled.
Extended Reporting Period
A period allowing for making claims after the expiration of a
"claims-made" policy.
Extra Expense Insurance
Insurance providing the extra funds needed to continue a business
uninterruptedly following a property loss.
Force Majeure
Circumstance that is beyond the control of one of the parties to a contract
and which may, according to the terms and conditions, relieve that party of
liability for failing to execute the contract. i.e. Act of God.
Hired Auto Liability
Liability the employer is exposed to when a vehicle is rented in the company
name.
Limit of Liability Per Occurrence
The maximum dollar amount the insurance company agrees to pay for any single
loss.
Negligence
Failure to use that degree of care which an ordinary person of reasonable
prudence would use under the given circumstances. Negligence may be
constituted by acts of either omission or commission or both.
Occurrence Coverage
A policy providing coverage only for injury or loss that occurs during the
policy period, regardless of when the claim is made. For example, a claim
made in the current policy year could be charged against a prior policy, or
may not be covered, if it arises from a event prior to the policy effective
date. Contrast with Claims-Made Coverage.
Package Policy
Multiple lines or types of insurance under one policy.
Professional Liability Insurance
Liability insurance to protect professionals for loss or expense resulting
from claims of mistakes, errors or omissions committed or alleged to have
been committed by the insured in his professional activities.
Property Damage Liability Insurance
Protection against liability for damage to the property of another not in
the insured's care, custody or control. Property damage liability coverage
is written in conjunction with Bodily Injury Liability Insurance, but the
premiums and limits of insurance are separate.
Retroactive Date
Date on a claims-made policy which triggers the beginning period of coverage
prior to the effective date. A retroactive date is not required. If one is
shown on the policy, any claim made during the policy period on a loss that
occurred before the retroactive date will not be covered.
Umbrella Liability Policy
A liability policy designed to provide liability protection in
addition to that provided by standard policies.
Valuable Papers and Records Insurance
Provides coverage for the replacement of valuable papers, records and forms,
including electronic media.
We have answered some of the more common questions on our "Question
and Answer" page.