Here you will find definitions for some of the insurance terms you might encounter in your policy or in conversation with your Paul & Dixon or Stoddard Insurance representative.

These definitions are edited from the Institute of Insurance Information Web-site (www.iii.org). We encourage you to visit this consumer-friendly site for additional definitions or other general information about insurance.

Actual Cash Value

Form of insurance that pays an amount equal to the replacement value of the damaged property minus depreciation.

Adjuster

Individual employed by a property/casualty insurance company to evaluate losses and settle policyholder claims.

Appraisal

Survey to determine a property's insurable value, or the amount of a loss.

Coverage

Synonym for insurance.

"Dec Page"

Part of the property/liability policy that includes the name and address of the policyholder; the property insured and its location and description; the policy period; premium amounts; and supplemental information.

Deductible

Amount of a loss absorbed by the insured. The bigger the deductible, the lower the premium charged for the same coverage.

Depreciation

Decrease in value due to wear and tear, decline in price, etc.

Endorsement

A written form attached to an insurance policy that alters its coverage, terms or conditions. It is sometimes called a Rider.

Floater

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

Liability Insurance

Insurance for what the policyholder is legally obligated to pay because of bodily injury or property damages caused to another person.

Limits

Maximum amount of insurance that can be paid for a loss.

Loss

A reduction in the quality or value of a property, or a legal liability.

Package Policy

Single insurance policy that combines several coverages also sold separately.

Peril

Specific risk or cause of loss (such as fire, wind) covered by an insurance policy. A Named Peril Policy covers the policyholder only for the perils named in the policy in contrast to an Special Perils Policy which covers all causes of loss except those specifically excluded.

Replacement Cost

Insurance that pays the amount needed to replace damaged property without deducting for depreciation, but limited by the maximum dollar amount shown on the "dec page" of the policy.

Rider

An attachment to an insurance policy that alters the policy's coverage or terms. Also referred to as an "endorsement."

Risk

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