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Renters Insurance Glossary

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ACTUAL CASH VALUE
The cost of your property, 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 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. In some instances, the loss may exceed limits and the policy holder would have to pay deductible, plus the excess.
DEPRECIATION
The decrease in the value of property due to wear and tear, and age.
ENDORSEMENT
An amendment attached to an insurance policy to add to or change the terms of the policy contract.
EXCLUSION
An event or loss that your insurance policy does not cover.
FLOATER
An insurance policy, separate from the basic homeowners or renters policy, which covers specific items of personal property. The coverage "floats" with the property — that is, it applies to the property wherever it is located, within the limits stated in the contract.
HOMEOWNERS POLICY
A package of insurance coverages, providing homeowners a broad range of personal property, dwelling and liability protection.
HOUSEHOLD GOODS POLICY
Insurance coverage for personal property; excludes liability coverage.
INSURED
A person or organization covered by an insurance policy, including the "named insured" and any other parties for whom protection is provided under the policy terms.
INSURER
The insurance company providing the coverage.
LIABILITY
Any legally enforceable obligation.
LIABILITY INSURANCE
Insurance that pays when you are legally responsible for an accident in which you have injured someone or damaged their property.
LIMITS
The maximum amount of insurance that will be paid for a covered loss.
MEDICAL PAYMENTS INSURANCE
A coverage to compensate people who sustain an injury while on your property or whom you injure accidentally. This coverage excludes those who live in your house.
NAMED PERILS
Perils specified in a policy as those against which the policy insures you.
PERIL
The cause of a loss insured against in a policy.
POLICY
A legal contract that sets forth the rights and obligations of both the policyholder and the insurance company.
PREMIUM
The amount of money you pay to the insurance company in return for insurance protection.
RENTERS POLICY
A homeowners policy adapted to the needs of people who rent. It usually provides protection for both your personal property and/or personal liability. Also called a tenants policy.
REPLACEMENT COST
The amount it would cost to replace damaged property at today’s prices, without a deduction for depreciation.
RISK
The chance of injury, damage or loss. Also used to refer to the insured or to property covered by a policy.
UMBRELLA LIABILITY
A policy that insures losses in excess of amounts covered by other liability insurance policies; also protects the insured in some situations not covered by the basic liability policies.
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