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ACTUAL CASH VALUE - A form of insurance that pays damages equal to the replacement value of damaged property minus depreciation. (See Replacement cost)

ADDITIONAL LIVING EXPENSE/LOSS OF USE
In the event of a major loss that makes your home uninhabitable, and you should have to move out and live elsewhere while your home is being repaired or rebuilt, the additional costs over and above your existing living expenses are covered for a set period of time.

ADDITIONS AND ALTERATIONS
Allows coverage for improvements that you make to your condominium such as, wall-to-wall carpeting, built-in appliances, etc. Also, according to the bylaws of your condominium association you may be responsible for interior portions of your condo such as walls and doors.

AGENT - Insurance is sold by two types of agents: independent agents, who are self-employed, represent several insurance companies, and are paid on commission, and exclusive or captive agents, who represent only one insurance company and are either salaried or work on commission. Insurance companies that use exclusive or captive agents are called direct writers.

APPRAISAL - A survey to determine a property's insurable value, or the amount of a loss.

AUDIT - A survey of the financial records of a person or organization conducted annually (in most cases) to determine exposures, limits, premiums, etc.

BASIC REPARATIONS BENEFITS - pays for loss of wages and medical expenses (with limitations) due to an injury sustained in an automobile accident. It also covers funeral expenses in the case of death caused by an auto accident.

BEST'S RATING -The rating system developed and published annually by A.M. Best Company that indicates the financial condition of insurance companies.

BINDER - Temporary authorization of coverage issued prior to the actual insurance policy.

BODILY INJURY LIABILITY - which protects you in the event you are determined to be legally responsible for an accident in which someone is injured or killed.

BURGLARY AND THEFT INSURANCE - Insurance for the loss of property due to burglary, robbery, or larceny. It is provided in a standard homeowners policy and in a business multiple peril policy.

BUSINESS INTERUPTION COVERAGE - Insurance covering loss of income suffered by a business as a result of not being able to use property damaged by a covered cause of loss during the time required to repair or replace it. Both of the Insurance Services Office's (ISO's) business income coverage forms (CP 00 30, the business income and extra expense coverage form and CP 00 32, the business income coverage form without extra expense) provide business interruption coverage, although they use the term "business income" in place of the term "business interruption."

CATASTROPHE - Term used for statistical recording purposes to refer to a single incident or a series of closely related incidents causing severe insured property losses totaling more than a given amount, currently $25 million.
Certificate of Insurance A document providing evidence that certain general types of insurance coverages and limits have been purchased by the party required to furnish the certificate.

CLAIMS MADE COVERAGE - Claims-made policies provide coverage for claims which are reported while the policy is in force for services rendered on or after the retroactive dates. The retroactive date is a mutually agreed upon date between the company and the insured. The claims made policy provides coverage for professional services rendered from the retroactive date through cancellation or expiration of the current policy. Claims-made coverage is less expensive than occurrence during the first few years of coverage. Each year as the policy is renewed, the price increases to compensate for the increased risk of claims from previous years. Premium increases, often called steps, reflect the insured's increased exposure to liability. Steps usually cease after five years have transpired from the retroactive date. Due to cancellation or non-renewal, an additional premium to purchase an Extended Reporting Endorsement commonly called "tail coverage" may be required to provide protection for claims reported after the policy's termination date.

COINSURANCE - In property insurance, requires the policyholder to carry insurance equal to a specified percentage of the value of property to receive full payment on a loss. For health insurance, it is a percentage of each claim above the deductible paid by the policyholder. For a 20 percent health insurance coinsurance clause, the policyholder pays for the deductible plus 20 percent of his covered losses. After paying 80 percent of losses up to a specified ceiling, the insurer starts paying 100 percent of losses.

COLLISION COVERAGE - pays for damage to your own auto that results from colliding with another vehicle or object, or from a vehicle rollover. Your car is covered no matter who causes the accident less the amount of your deductible.

COMPREHENSIVE COVERAGE - pays for damage to your auto caused by something other than a collision. This includes fire, theft, vandalism and disasters such as, flood, hail, and contact with a bird or other animal.

CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT (COBRA) - A federal act which requires each group health plan to allow employees and certain dependents to continue their group coverage for a stated period of time following a qualifying event that causes the loss of group health coverage. Qualifying events include reduced work hours, death or divorce of a covered employee, and termination of employment.

CONVERTIBLE CLAIMS - Made-Recently a new form of claims-made policy has been introduced to the New England market. This policy allows the insured to begin coverage with a standard claims-made policy including complete retro-dating. The difference is that after a predetermined number of loss free years, this policy converts to an occurrence policy. This conversion takes place without the insured having to purchase an extended reporting endorsement. If there is a loss during the conversions years, the policy continues as a standard claims made program. Premium calculations and the number of conversion years required differ from company to company.

CONTENTS REPLACEMENT COST - Pays for the cost to repair or replace most personal property without depreciation.
Cost, Insurance, and Freight (CIF) One of several standard terms of sale for exports and imports. CIF indicates that the seller must obtain transit insurance on the goods, since the price paid by the buyer includes the cost of goods, insurance while they are in transit, and all freight charges.

COVERAGE - Synonym for insurance.

CREDIT SCORE - The number produced by an analysis of an individual's credit history. The use of credit information affects all consumers in many ways, from getting a job, finding a place to live, securing a loan, getting a telephone, and buying insurance. Credit history is routinely reviewed by insurers before issuing a commercial policy because businesses in poor financial condition tend to cut back on safety which can lead to more accidents and more claims. Auto and home insurers may use information in a credit history to produce an insurance score. Insurance scores may be used in underwriting and rating insurance policies. (See Insurance score.)

CREDIT CARD AND CHECK FORGERY - Most renters' policies automatically provide you with up to $1,000 of coverage for losses you incur resulting from forgery or any alteration related to your credit cards, ATM cards or checks used by you or your residing family members.

CRIME INSURANCE - Term referring to property coverages for the perils of burglary, theft, and robbery.

DECLARATION - Part of a property or liability insurance policy that states the name and address of policyholder, property insured, its location and description, the policy period, premiums, and supplemental information. Referred to as the "dec page."

DEDUCTIBLE - The amount of loss paid by the policyholder. Either a specified dollar amount, a percentage of the claim amount, or a specified amount of time that must elapse before benefits are paid. The bigger the deductible, the lower the premium charged for the same coverage.

EARNED PREMIUM - The portion of premium that applies to the expired part of the policy period. Insurance premiums are payable in advance but the insurance company does not fully earn them until the policy period expires.

EARTHQUAKE INSURANCE - Covers a building and its contents, but includes a large percentage deductible on each. A special policy or endorsement exists because earthquakes are not covered by standard homeowners or most business policies.

EMPLOYEE RETIREMENT INCOME SECURITY ACT (ERISA) LIABILITY - Liability under the Employee Retirement Income Security Act of 1974 for the exposure arising out of the responsibility as an officer or fiduciary of a company for the handling of pension funding and other employee benefit plans. Should the fiducial responsibility be breached, the individual is personally liable for the loss. The resulting exposure is usually excluded from the general liability policy, even when employee benefits liability coverage is purchased. However, coverage may be purchased in the form of a seperate fiduciary liability policy.

ENDORSEMENT - A written form attached to an insurance policy that alters the policy's coverage, terms, or conditions. Sometimes called a rider.

ERRORS AND OMISSIONS INSURANCE - An insurance form that protects the insured against liability for committing an error or omission in performance of professional duties. Generally, such policies are designed to cover financial losses rather than liability for bodily injury and property damage.

ESCROW ACCOUNT - Funds that a lender collects to pay monthly premiums in mortgage and homeowners insurance, and sometimes to pay property taxes.

EXCLUSION - A provision in an insurance policy that eliminates coverage for certain risks, people, property classes, or locations.

EXPERIENCE - Record of losses.

EXPOSURE - Possibility of loss.

EXTENDED COVERAGE - An endorsement added to an insurance policy, or clause within a policy, that provides additional coverage for risks other than those in a basic policy.

EXTENDED REPLACEMENT COST COVERAGE - Pays a certain amount above the policy limit to replace a damaged home, generally 120 percent, or 125 percent. Similar to a guaranteed replacement cost policy, which has no percentage limits. Most homeowner policy limits track inflation in building costs. Guaranteed and extended replacement cost policies are designed to protect the policyholder after a major disaster when the high demand for building contractors and materials can push up the normal cost of reconstruction. (See Guaranteed replacement cost coverage)

EXTENDED REPORTING ENDORSEMENT - When issued, the extended reporting endorsement (often referred to as tail coverage) provides protection for future claims filed. By contrast, some insurers offer tail coverage for a short period of time after the termination of the policy, after which the insurer has no responsibility to provide tail coverage. Extended Reporting Endorsements may require an additional premium, sometimes two or three times the current year's premium. Tail coverage may be vested at death, due to total disability or at retirement if certain qualifications are met. These qualifications vary between insurers.

EXTRA EXPENSE COVERAGE - Coverage for expenses in excess of normal operating expenses that are incurred to continue operations after a direct damage loss. Extra expense coverage is appropriate for service businesses whose property is not essentially income-producing (banks, insurance agencies, and doctors' offices), and for businesses that would find it imperative to continue operation regardless of cost (newspapers, daires). perhaps by using competitor's facilities.

FAIR ACCESS TO INSURANCE REQUIREMENTS PLANS / FAIR PLANS - Insurance pools that sell property insurance to people who can't buy it in the voluntary market because of high risk over which they may have no control. FAIR Plans, which exist in 28 states and the District of Columbia, insure fire, vandalism, riot, and windstorm losses, and some sell homeowners insurance which includes liability. Plans vary by state, but all require property insurers licensed in a state to participate in the pool and share in the profits and losses.

FAMILY AND MEDICAL LEAVE ACT (FMLA)-The Family and Medical Leave Act of 1993 (FMLA) went into effect on August 5, 1993. The law requires employers with 50 or more employees to offer eligible employees at least 12 weeks of unpaid leave for the birth or adoption of a child, to care for a sick family member or for the employee's own illness.

FARMOWNERS-RANCHOWNERS INSURANCE - Package policy that protects the policyholder against named perils and liabilities and usually covers homes and their contents, along with barns, stables, and other structures.

FIRE INSURANCE - Coverage protecting property against losses caused by a fire or lightning that is usually included in homeowners or commercial multiple peril policies.

FIRE LEGAL LIABILITY COVERAGE - Coverage for the insured's liability for fire damage to premises rented to the insured. Included in the 1986 commercial general liability policy, but subject to a separate limit of insurance. This coverage can also be provided in a property policy.

FLOATER - Attached to a homeowners policy, a floater insures movable property, covering losses wherever they may occur. Among the items often insured with a floater are expensive jewelry, musical instruments, and furs. It provides broader coverage than a regular homeowners policy for these items.

FLOOD INSURANCE - Coverage for flood damage is available from the federal government under the National Flood Insurance Program but is sold by licensed insurance agents. Flood coverage is excluded under homeowners policies and many commercial property policies. However, flood damage is covered under the comprehensive portion of an auto insurance policy.

FLEET - For classifying commercial vehicles under the business auto policy, five or more automobiles. Less than five is considered nonfleet. The distinction is made for statistical coding purposes. It does not have effect on the rating factors.

FREE ON BOARD (FOB)-One of several standard terms used in contracts of sale to indicate responsiblity for damage to goods during shipment. When goods are shipped FOB, the seller's responsibility ends when a carrier takes possession of them, or, with respect to ocean shipments, when the merchandise is placed safely aboard the vessel or when an on-board bill of lading has been issued. The buyer is responsible for insuring the goods from that point on.

FREQUENCY - Number of times a loss occurs. One of the criteria used in calculating premium rates.

GUARANTEED REPLACEMENT COST COVERAGE - Homeowners policy that pays the full cost of replacing or repairing a damaged or destroyed home, even if it is above the policy limit. (See Extended replacement cost coverage)

HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY ACT (HIPAA) - A federal act that protects people who change jobs, are self-employed, or who have pre-existing medical conditions. The act also contains provisions designed to ensure that prospective or current enrollees in a group health plan are not discriminated against based on health status.

HOMEOWNERS INSURANCE POLICY - The typical homeowners insurance policy covers the house, the garage, and other structures on the property, as well as personal possessions inside the house such as furniture, appliances, and clothing, against a wide variety of perils including windstorms, fire, and theft. The extent of the perils covered depends on the type of policy. An all-risk policy offers the broadest coverage. This covers all perils except those specifically excluded in the policy. Homeowners insurance also covers additional living expenses. Known as Loss of Use, this provision in the policy reimburses the policyholder for the extra cost of living elsewhere while the house is being restored after a disaster. The liability portion of the policy covers the homeowner for accidental injuries caused to third parties and/or their property, such as a guest slipping and falling down improperly maintained stairs. Coverage for flood and earthquake damage is excluded and must be purchased separately. (See Flood insurance; Earthquake insurance)

HURRICANE DEDUCTIBLE - A percentage or dollar amount added to a homeowner's insurance policy to limit an insurer's exposure to loss from a hurricane. Higher deductibles are instituted in higher risk areas, such as coastal regions. Specific details, such as the intensity of the storm for the deductible to be triggered and the extent of the high risk area, vary from insurer to insurer and state to state.

IDENTITY THEFT INSURANCE - Coverage for expenses incurred as the result of an identity theft. Can include costs for notarizing fraud affidavits and certified mail, lost income from time taken off from work to meet with law-enforcement personnel or credit agencies, fees for reapplying for loans and attorney's fees to defend against lawsuits and remove criminal or civil judgments.

INDEMNIFY - Provide financial compensation for losses.

INFLATION GUARD CLAUSE - A provision added to a homeowners insurance policy that automatically adjusts the coverage limit on the dwelling each time the policy is renewed to reflect current construction costs.

INSURABLE RISK - Risks for which it is relatively easy to get insurance and that meet certain criteria. These include being definable, accidental in nature, and part of a group of similar risks large enough to make losses predictable. The insurance company also must be able to come up with a reasonable price for the insurance.

INSURANCE - A system to make large financial losses more affordable by pooling the risks of many individuals and business entities and transferring them to an insurance company or other large group in return for a premium.

INSURANCE SCORE - Insurance scores are confidential rankings based on credit information. This includes whether the consumer has made timely payments on loans, the number of open credit card accounts and whether a bankruptcy filing has been made. An insurance score is a measure of how well consumers manage their financial affairs, not of their financial assets. It does not include information about income or race. Studies have shown that people who manage their money well tend also to manage their most important asset, their home, well. In addition, people who manage their money responsibly tend to handle driving a car responsibly. Some insurance companies use insurance scores as an insurance underwriting and rating tool.

INSURANCE-TO-VALUE - Insurance written in an amount approximating the value of the insured property.

LIABILITY INSURANCE - helps protect you if you cause an injury to others or damage the property of others with your vehicle, and you are determined to be legally liable. It protects you from lawsuits arising out of the ownership of a covered automobile or the negligent operation of that auto. Because this coverage protects your assets, should there be a lawsuit, it's important to have this coverage and keep the amount of coverage (limits) at a consistently high level. There are two types of liability insurance:
LIMITS - Maximum amount of insurance that can be paid for a covered loss.
LINE - A type or kind of insurance, such as personal lines. LOSS Reduction in the quality or value of a property, or a legal liability.

LOSS OF USE - A provision in homeowners and renters insurance policies that reimburses policyholders for any extra living expenses due to having to live elsewhere while their home is being restored following a disaster.

LOSS ASSESSMENT COVERAGE - This coverage provides up to $1,000 (option to increase) of protection if damage to commonly owned property should exceed the amount of coverage provided in the Condominiums master policy. In the event that your condo association is forced to assess all owners for an additional loss, loss assessment will provide you with coverage.
Medical Payments-Will pay for medical expenses if someone outside of your family household is injured while on your property, or is injured by you or a resident household member away from your property (No-Fault/Goodwill Coverage).

MEDICAL PAYMENTS INSURANCE - A coverage in which the insurer agrees to reimburse the insured and others up to a certain limit for medical or funeral expenses because of bodily injury or death by accident. Payments are without regard to fault.

MULTIPLE PERIL POLICY - A package policy, such as a homeowners or business insurance that provides coverage against several different perils. It also refers to the combination of property and liability coverage in one policy. In the early days of insurance, coverages for property damage and liability were purchased separately.

NAMED PERIL - Peril specifically mentioned as covered in an insurance policy.

NATIONAL FLOOD INSURANCE PROGRAM - Federal government-sponsored program under which flood insurance is sold to homeowners and businesses.

NOTICE OF LOSS - A written notice required by insurance companies immediately after an accident or other loss. Part of the standard provisions defining a policyholder's responsibilities after a loss.

OCCURRENCE COVERAGE - Occurrence coverage provides protection for professional services rendered during the year the policy is in effect, regardless when the claim is reported. Even after you stop practicing, your estate coverage for your past professional services. Premiums for each policy period are known when the policy is purchased. There are never additional costs when purchasing occurrence policies or should the doctor wish to change insurers. At each renewal, the insured chooses a limit for that policy period. You are protected up to that limit regardless of when the claim is filed. Occurrence coverage may not be available in all areas of the country. In fact, fewer insurers offer occurrence coverage than claims mad. Insurance companies must plan for future liability exposure when issuing occurrence policies, and must collect premium to cover projected losses based on awards and inflation. the cost of occurrence coverage is generally higher than claims made coverage.

ORDINANCE OR LAW COVERAGE - Endorsement to a property policy, including homeowners, that pays for the extra expense of rebuilding to comply with ordinances or laws, often building codes that did not exist when the building was originally built. For example, a building severely damaged in a hurricane may have to be elevated above the flood line when it is rebuilt. This endorsement would cover part of the additional cost.

PACKAGE POLICY - A single insurance policy that combines several coverages previously sold separately. Examples include homeowners insurance and commercial multiple peril insurance.

PERIL - A specific risk or cause of loss covered by an insurance policy, such as a fire, windstorm, flood, or theft. A named-peril policy covers the policyholder only for the risks named in the policy in contrast to an all-risk policy, which covers all causes of loss except those specifically excluded.

PERSONAL ARTICLES FLOATER - A policy or an addition to a policy used to cover personal valuables, like jewelry or furs.

PERSONAL LIABILITY COVERAGE - Personal liability pays, up to your limit of liability, when you or a resident of your family is found legally responsible for damage to the property of others or injuries to persons who are not members of your household. If you or a family member is found legally responsible, your personal liability coverage will provide coverage for those damages.

PERSONAL LINES - Property/casualty insurance products that are designed for and bought by individuals, including homeowners and automobile policies.

PERSONAL PROPERTY COVERAGE - Renters insurance provides protection for your personal possessions at or away from home. Personal property coverage is also referred to as contents coverage.While in your rented property Caused by your personal activities Caused by your children or pets

PERSONAL ARTICLES FLOATER - A policy or an addition to a policy used to cover personal valuables, like jewelry or furs.

POLICY - A written contract for insurance between an insurance company and policyholder stating details of coverage.

PREMISES - The particular location of the property or a portion of it as designated in an insurance policy.

PREMIUM - The price of an insurance policy, typically charged annually or semiannuallyPROOF OF LOSS Documents showing the insurance company that a loss occurred.

PROPERTY/CASUALTY INSURANCE - Covers damage to or loss of policyholders' property and legal liability for damages caused to other people or their property. Property/casualty insurance, which includes auto, homeowners, and commercial insurance, is one segment of the insurance industry. The other sector is life/health. Outside the United States, property/casualty insurance is referred to as nonlife or general insurance.

PRIOR ACTS COVERAGE - If you are presently insured by another company, prior acts coverage purchased at the time a new policy is written may eliminate the need to purchase tail coverage from your present insurer. Prior acts cover-age protects an insured against new claims that arise from incidents occurring after the retroactive date of the new policy, reported during the term of the policy, while the policy is in force. Prior acts coverage is offered on an individual basis and is not offered in all areas of the country.

PROPERTY COVERAGE FOR DWELLINGS - Your physical home with its permanent attachments as well as any attached structures represents your dwelling. The amount of coverage assigned to your dwelling should reflect the amount that it would cost to completely repair or rebuild your home from the foundation up if your home should suffer a total loss.

PROPERTY DAMAGE TO OTHER STRUCTURES - Structures that exist on your property but are not actually attached to your house, such as a detached garage, gazebo or storage shed represent "Other Structures".

PROPERTY DAMAGE LIABILITY - covers the damage your vehicle causes to someone else's property, such as their car, mailbox or a fence on their land.

REINSURANCE - A transaction in which one party, the "reinsurer," in consideration of a premium paid to it, agrees to indemnify another party, the "reinsured," for part or all of the liability assumed by the reinsured under a policy or policies of insurance that it has issued. The reinsured may also be referred to as the "original" or "primary" insurer, or the "ceding company."

RENTAL REIMBURSEMENT - will pay for the cost of a rental car while your car is being repaired due to an accident. This coverage offers a choice of different daily dollar amounts with a maximum aggregate limit ($15- $50 per day with a $600 maximum benefit).

REPLACEMENT COST COVERAGE ENDORSEMENT/OPTION - A property insurance provision that changes the valuation of covered property from actual cash value to replacement cost value: the cost to replace it today with property of like kind and quality without deduction for depreciation.

RETROACTIVE DATE - A provision found in many claims-made policies that eliminate coverage for injuries or damage that occured prior to a specified date even if the claim is first made during the policy period.

RENTERS INSURANCE - A form of insurance that covers a policyholder's belongings against perils such as fire, theft, windstorm, hail, explosion, vandalism, riots, and others. It also provides personal liability coverage for damage the policyholder or dependents cause to third parties. It also provides additional living expenses, known as loss-of-use coverage, if a policyholder must move while his or her dwelling is repaired. It also can include coverage for property improvements. Possessions can be covered for their replacement cost or the actual cash value that includes depreciation.

RETURN-TO-WORK PROGRAM - A post-injury program that returns injured employees to some type of work as soon as medically possible. Even if the injured workers are impaired, temporary or modified duties can be assigned that take into consideration the impairments. The end result is the reduction of indemnity costs associated with the claims.

RIDER - An attachment to an insurance policy that alters the policy's coverage or terms.

RISK - The chance of loss or the person or entity that is insured.

SCHEDULED PERSONAL PROPERTY ENDORSEMENT - For valuables such as fine art, jewelry or golf equipment. Provides worldwide "all-risk" protection against fire, theft and other perils not specifically excluded. Replacement Cost for Contents of personal property that is damaged or stolen. This options provides worldwide coverage and is not subject to depreciation. Broadened Contents Coverage provides "all-risk" protection for your possessions. Which means that your personal property is covered in most situations, regardless of the cause of loss. Home computer coverage for your personal computer, software and peripheral devices. Extended coverage for jewelry, watches and furs that are stolen or damaged. Home replacement cost coverage to provide up to 100% of your home's replacement cost value if it is completely destroyed due to a covered peril.
Scheduled Personal Property If your personal property includes such valuables as fine art, jewelry or golf equipment, you may want to consider an optional Scheduled Personal Property endorsement to cover them. This endorsement will provide you with worldwide, "all-risk" protection against fire, theft, and other perils not specifically excluded. (This coverage is subject to underwriting approval.)

SELF-INSURED RETENTION (SIR) - A dollar amount specified in an insurance policy (usually a liability insurance policy) that must be paid by the insured before the insurance policy will respond to a loss. SIRs typically apply to both the amount of the loss and related costs, e.g., defense costs, but some apply only to amounts payable in damages, e.g., settlements, awards, and judgements. An SIR differs from a true deductible in at least two important ways. Most importantly, a liability policy's limit stacks on top of an SIR while the amount of a liability insurance deductible, the insurer is not obligated to pay the SIR amount and then seek reimbursment from the insured: the insured pays the SIR directly to the claimant. While these are the theoretical differences between SIRs and deductibles, they are not well understood, and the actual policy provisions should be reviewed to ascertain the actual operation of specific provisions.

SEVERITY - Size of a loss. One of the criteria used in calculating premiums rates.

SEWER BACK-UP COVERAGE - An optional part of homeowners insurance that covers sewers.

SUBROGATION - The legal process by which an insurance company, after paying a loss, seeks to recover the amount of the loss from another party who is legally liable for it.

TOTAL LOSS - The condition of an automobile or other property when damage is so extensive that repair costs would exceed the value of the vehicle or property.

TOWING AND LABOR - will pay up to a fixed amount (check your policy declarations page) for towing and labor charges (such as towing to a garage, changing a flat tire or "jump starting" your motor, but not for parts needed, such as a new tire) at the place of disablement each time your car breaks down.

UNDERINSURED MOTORIST (UIM) COVERAGE - will pay for damages that exceed the amount of coverage carried by an underinsured driver.

UNINSURED MOTORIST COVERAGE - Provides coverage for bodily injury, and in some states property damage, caused by a motorist that is not insured. Uninsured motorists coverage allows an insured to collect from his or her own insurer as if it covered the negligent third party.

UMBRELLA POLICY - Coverage for losses above the limit of an underlying policy or policies such as homeowners and auto insurance. While it applies to losses over the dollar amount in the underlying policies, terms of coverage are sometimes broader than those of underlying policies.

UNDERINSURANCE - The result of the policyholder's failure to buy sufficient insurance. An underinsured policyholder may only receive part of the cost of replacing or repairing damaged items covered in the policy.

UNDERWRITING - Examining, accepting, or rejecting insurance risks and classifying the ones that are accepted, in order to charge appropriate premiums for them.

UNEARNED PREMIUM - The portion of a premium already received by the insurer under which protection has not yet been provided. The entire premium is not earned until the policy period expires, even though premiums are typically paid in advance.

VANDALISM - The malicious and often random destruction or spoilage of another person's property.

VOID - A policy contract that for some reason specified in the policy becomes free of all legal effect. One example under which a policy could be voided is when information a policyholder provided is proven untrue.

VOLCANO COVERAGE - Most homeowners policies cover damage from a volcanic eruption.

WATER-DAMAGE INSURANCE COVERAGE - Protection provided in most homeowners insurance policies against sudden and accidental water damage, from burst pipes for example. Does not cover damage from problems resulting from a lack of proper maintenance such as dripping air conditioners. Water damage from floods is covered under separate flood insurance policies issued by the federal government.