Insurance Terminology

                                                                 Insurance Terminology

Policy Date

The date the provisions of the insurance policy take effect. It is shown on the policy data page. Policy years and policy months are measured from the policy date.

Policy Term

The period of time during which an insurance policy is in effect. Also referred to as Policy Period and Term of Policy.

Effective Date

The date the policy starts and insurance protection begins. May also be called the "inception date." This date can be found on your Declaration (DEC) Page or Insurance Identification Card.

Expiration Date

The date when your current insurance policy expires. This date can be found on the Declarations (DEC) Page, as well as on insurance identification cards.

Term of Policy

The period of time during which an insurance policy is in effect. Also referred to as Policy Period and Policy Term.

Actual Cash Value (ACV)

The value of the property lost or damaged at the time of the loss.

This method of valuation takes into consideration depreciation based on such factors as:

§  · age of the item

§  · market value and, the condition of the property at the time of loss or damage

Depreciation

A decrease in the value of an item or property due to wear, age, or other cause.

Market Value

Open market selling price. Price varies with economic conditions at any given time.

Replacement Cost

The cost of replacing damaged or destroyed property without deduction for depreciation in the value of the property.

Binder

A written or oral acknowledgment that insurance is in force and evidence that an applicant has accepted the insurer's offer to purchase insurance coverage.

Cancellation

Ending or terminating an insurance contract before the specified end-date noted in the policy

Condominium

A real estate ownership in which there is individual ownership of a single unit in a multiple unit building and an interest in common property jointly owned by all unit owners. In most cases, an association operates the complete and common property.

Condo Comprehensive Endorsement

This option increases the covered causes of loss within your policy. The actual effect of this option varies depending on your location and should be discussed with a licensed insurance professional.

Hazard

A condition that creates or increases the chance that a loss will occur. For example, a wood-burning stove may increase the chance of fire losses.

Home and Car Discount

Discounts of up to 10% on your auto and property insurance premiums may be available when you have both a Nationwide auto and home, condominium, renters, or mobile home policy. Discount applicability, availability and percentages may vary from state to state.

Insured

The person(s) or party(ies) who are insured or protected by an insurance policy.

Insurer

The company who provides the insurance coverage and services on a specific policy.

Condominium Insurance

Coverage designed exclusively for you, your condominium and your personal belongings.

Certificate of Insurance

This certifies to the certificate holder that the policy indicated is in force as of the dates shown on the certificate.

Endorsement

A written amendment attached to an insurance policy to change, restrict or broaden coverage.

Installment Amount Due

Your payment amount. This is based on the Total Amount Due and the number of payments you have elected.

Liability Coverage (Auto)

Liability insurance pays the losses of other people which an insured may cause unintentionally or through negligence.

Liability coverage consists of two parts: bodily injury coverage and property damage coverage.

• Bodily injury liability coverage usually pays medical costs of others and legal defense costs for the insured. The limits of coverage are usually displayed as two numbers, such as 100/300. The first number is the limit per person injured or killed, and the second number is the limit per accident.
• Property damage liability coverage pays claims against the insured if there is damage to someone else's car or property caused by the insured.

Liability Coverage (Homeowner)

Liability insurance pays for damages to property owned by third parties or injuries to third parties which an insured may cause unintentionally or through negligence.

Liability coverage consists of two parts: personal liability coverage and medical payments to others.

• Personal liability coverage provides protection for the actions of an individual, which cause bodily injury or property damage to another, subject to exclusions.
• Medical payments to others covers necessary medical and funeral expenses incurred within 3 years after an accident causing bodily injury. This coverage does not apply to you or members of your household

Loss of Use Coverage (Auto)

A coverage that reimburses the insured for costs incurred due to damages from a covered loss.

The actual amount of coverage provided, and the cost of this option may vary by state.

Should your vehicle be un-driveable following a covered incident, this optional coverage may provide limited reimbursement for transportation expenses. There are two available levels of coverage: The standard level typically provides $15 a day with a maximum of $300 per accident, while the Broad Form normally provides $25 a day with a maximum of $800 per accident.

Loss of Use Coverage (Home)

Provides reimbursement up to the limit specified on the policy for additional living expenses incurred as a result of being unable to live in your home.

Loss of Use Coverage (Rental)

This option may provide reimbursement for transportation expenses should your car be undriveable due to a covered collision or comprehensive loss.

Named Insured

The person specifically designated by name as the insured in an insurance policy. This person is also referred to as the policyholder.

Occupancy

How the covered property is used, such as a residence.

There are two types of occupancy:

• Primary Occupancy refers to the principle location where the policyholder resides.
• Secondary/Seasonal Occupancy refers to an additional location where the policyholder resides on an occasional basis.

Policy Type

Describes the specific coverage provided by the policy based on the type of item being insured.

For example:

• Automobile
• Homeowners
• Umbrella

Premium

The amount of money an insurance company charges in return for providing coverage.