Actual Cash Value
An amount equivalent to the fair market value of the stolen or damaged property immediately preceding the loss. For real property, this amount can be based on a determination of the fair market value of the property before and after the loss. For vehicles, this amount can be determined by local area private party sales and dealer quotations for comparable vehicles.

Agent
A licensed person or organization authorized to sell insurance by or on behalf of an insurance company.

Binder
A temporary or preliminary agreement which provides coverage until a policy can be written or delivered.

Cancellation
The termination of insurance coverage during the policy period. Flat cancellation is the cancellation of a policy as of its effective date, without any premium charge.

Claim
Notice to an insurer that under the terms of a policy, a loss maybe covered.

Claimant
The first or third party. That is any person who asserts right of recovery.

Credit Life Insurance
Insurance issued to a creditor (lender) to cover the life of a debtor (borrower) for an outstanding loan.

Decline
The company refuses to accept the request for insurance coverage.

Deductible
The amount of the loss which the insured is responsible to pay before benefits from the insurance company are payable. You may choose a higher deductible to lower your premium.

Disability Insurance
Health insurance that provides income payments to the insured wage earner when income is interrupted or terminated because of illness, sickness, or accident.

Endorsement
Amendment to the policy used to add or delete coverage. Also referred to as a "rider."

Exclusion
Certain causes and conditions, listed in the policy, which are not covered.

Expiration Date
The date on which the policy ends.

Face Amount
The dollar amount to be paid to the beneficiary when the insured dies. It does not include other amounts that may be paid from insurance purchased with dividends or any policy riders.

Financial Guarantee Insurance
A surety bond, insurance policy or, when issued by an insurer, an indemnity contract and any guaranty similar to the foregoing types, under which loss is payable upon proof of occurence of financial loss to an insured claimant, obligee, or indemnitee.

Grace Period
A period (usually 31 days) after the premium due date, during which an overdue premium may be paid without penalty. The policy remains in force throughout this period.

Guaranteed Insurability
An option that permits the policy holder to buy additional stated amounts of life insurance at stated times in the future without evidence of insurability.

Health Insurance
A policy that will pay specifies sums for medical expenses or treatments. Health policies can offer many options and vary in their approaches to coverage.

Incontestable Clause
A policy provision in which the company agrees not to contest the validity of the contract after it has been in force for a certain period of time, usually two years.

Insured
The policyholder - the person(s) protected in case of a loss or claim.

Insurer
The insurance company.

Legal Insurance
Prepaid legal insurance coverage plan sold on a group basis.

Life Insurance
A policy that will pay a specified sum to beneficiaries upon the death of the insured.

Limit
Maximum amount a policy will pay either overall or under a particular coverage.

Loan Value
The amount which can be borrowed at a specified rate of interest from the issuing company by the policyholder, using the value of the policy as collateral. In the event the policyholder dies with the debt partially or fully unpaid, then the amount borrowed plus any interest is deducted from the amount payable.