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The A-Z of Insurance Terms

Insurance Terms Glossary

Confused by insurance terminology? Kwiksure is here to simplify insurance terms with this handy A-Z glossary of insurance vocabulary. If you’ve got any more questions, we’re more than happy to help! Simply contact our team of experienced advisors today or call 3113 1331.

A

Accident - An unexpected event.

Accidental bodily injury - Injury caused to a person/people without deliberate intent.

Adjuster - A representative of the insurer, someone who investigates insurance claims to determine the liability of the insurer.

B

Betterment - Most commonly found in motor insurance policies, the betterment clause stipulates that once a damaged item/piece of property has been repaired, its resulting condition is more valuable. Therefore, the net improvement won’t be reimbursed by the insurer.   

Boat insurance - This will provide coverage for your vessel’s hull, machinery, fixtures and fittings.

Broker - A registered advisor and intermediary that acts on behalf of an insurance company.

Business insurance - Provides protection from losses incurred during the operation of a business. There are many types of business insurance, such as coverage for property damage, public liability, professional indemnity, etc.

C

Cancellation - The termination of an insurance policy.

Claim - A reimbursement provided by the insurance company for losses covered by an insurance policy.

Claims history - A record of previously submitted claims.

Comprehensive motor insurance - A motor insurance term, this type of policy provides extensive cover for both third party and first party losses in the event of an accident.

Conditions - Circumstances as specified in the insurance contract which must be upheld.

Contract - A legal agreement between two parties.

Copayment - A predetermined fixed amount paid by the insured every time they submit a claim.

Coverage - The amount of liability covered by an insurance policy.

D

Deductible - An amount to be paid by a policyholder (see: Insured) each year or for each claim before it can be submitted.

Dental insurance - This is usually an add-on benefit, providing coverage for dental costs.

Depreciation - The reduction in value of an insured item.

E

Exclusion - Clauses within the policy that rules out coverage for certain circumstances, situations, and acts.

Exposure - The risk of loss.

F

Fire insurance - This will protect your house or apartment in the unfortunate event of a fire. Some fire insurance policies will additionally cover other perils, this is called an ‘Extra Perils’ policy.

Fraud - An illegal act with the intent of gaining benefits and value which the insurer or the insured are not legally entitled to.

G

Golf insurance - Covers bodily injury liabilities to third parties or property damage while playing golf.

Grace period - A provision in insurance contracts that allows payment without penalties for a specified period of time after the payment due date.

H

Home insurance - This protects the possessions in your home from unforeseen accidents, theft or home improvements.

Health insurance - Insurance that covers the cost of health care.

I

Insured - The individual, group, or entity covered by insurance. The insured is also commonly referred to as the policyholder.

Insurer - The person or company that issues an insurance policy to the insured.

International plans - An insurance policy that is not limited to one country or area, and is usually globally portable.

L

Life insurance - Covers financial losses incurred from the death of the policyholder.

Local plans - An insurance policy that is limited to one country or area. Policyholders will not be eligible for being reimbursed for claims outside of the country specified in the local policy.

Loss adjustor - A person who handles claims and assesses how much should be paid out to the policyholder.

M

Maid insurance - Protects domestic helpers from accidents or illnesses incurred during their time of employment.

Marine insurance - Provides cover for loss or damage of cargo, ships, etc.

Maternity insurance - This is usually an add-on benefit. It covers treatment costs related to one’s pregnancy.

Medical insurance - Covers the policyholder’s health care related expenses.

Motor insurance - A mandatory policy required by law, this policy offsets costs incurred in the event of a motor vehicle accident.

N

No Claims Discount/NCD - A discount applied to a policy when you go for a certain duration of time without filing a claim.

P

Policy - An insurance contract between the insured and the insurer.

Policy period - The duration of a policy.

Policyholder - The individual, group, or entity covered by insurance. The policyholder is also commonly referred to as the insured.

Premium - The amount paid to an insurer for an insurance policy.

Q

Quote - An estimation of the premium you will have to pay for a selected policy.

R

Renewal - The continuation of an insurance policy, secured through subsequent premiums paid by the insured.

Rider - A term often used by insurance companies, this refers to the additional benefits that can be added to a policy at an extra cost .

Risk - The likelihood of negative occurrences caused by an insurable event.

T

Third party motor insurance - Provides the level of minimal cover required by law. This type of motor insurance covers the policyholder for their liability to third parties in the event of an accident.

Travel insurance - Protects you from a number of risks associated with going abroad, such as medical emergency costs, loss of baggage, etc.


U

Underwriter - Underwriters are trained to undergo underwriting by assessing and evaluating risk, and use this knowledge to determine how much the policyholder should pay for their insurance plan and the level of coverage they should receive.

Underwriting A process employed by insurance companies to assess and determine a potential client’s risk and eligibility for coverage.

V

Vision insurance - This is usually an add-on benefit, and provides coverage for optical-related costs.

 

W

Waiting period - Also known as the probationary period, this refers to the period of time from when you purchase your insurance policy before you are eligible for making any claims.