General insurance terms
Actual cash value: This type of coverage pays according to what an item was worth at the time it was damaged—it takes depreciation and wear and tear into account.
Actual replacement cost: This pays the amount it would cost to replace a damaged item with a new one). It does not factor in depreciation or wear and tear.
Adjuster: A person who works for an insurance company to evaluate losses and settle claims.
Declarations page: This is what creates a contract between you and the insurance company. It describes who owns the policy, what property is covered and for how much, etc.
Deductible: The amount you agree to pay out of pocket before your insurance coverage kicks in.
Endorsement: This is a change to your insurance policy's coverage, usually made through a special form.
Exclusion: Something specifically listed in your policy that is not covered by the policy.
Liability: Your responsibility for injuries or damage to other people or property. You purchase insurance to protect against liability and other risks.
Loss of use: When damage from an accident or other cause prevents someone from being able to live in their home or drive their car.
Med Pay (medical payments): This pays for medical expenses for those covered by your policy in the event of an auto accident, regardless of fault. It also covers medical expenses for guests if they are injured on your property.
Premium: The amount you pay for an insurance policy.
Subrogation: When an insurance company pays a claim, and then seeks damages from a third party who was responsible for causing the damage or loss.
Term: The period of time your insurance policy is in effect, usually six or 12 months.
Umbrella: A policy that provides additional liability coverage. It kicks in after your other insurance policies have reached their coverage limits.
Underwriting: The evaluation process insurance companies use to determine if they will provide coverage to a customer.
Auto insurance terms
Aftermarket parts: Vehicle parts made by a different company than the one that manufactured those originally included with the vehicle.
Bodily injury coverage: Covers expenses for physical injuries, such as hospital bills or medical care.
Collision coverage: This pays for damage to a vehicle caused by you or someone else covered by your policy.
Comprehensive coverage: If your vehicle is damaged by something you could not control, such as fire or a tree falling, comprehensive coverage applies.
Uninsured/underinsured motorist (UIM): Pays for your damages and expenses if another driver is at fault in an accident but does not have enough insurance to cover your costs.
Homeowner insurance terms
Additional living expenses: Coverage for expenses above your usual living expenses, such as if you have to stay in a hotel because you cannot live in your damaged home.
Catastrophe: A disaster, such as a hurricane or tornado, which affects a specific area and results in significant damage.
Flood insurance: Typically, standard homeowner policies do not provide coverage for flooding—it must be purchased separately.
Home contents: Things inside your house that are not fixed to the structure, such as your furniture, appliances, etc.
Peril: A specifically defined risk, such as lightning, hail, wind, etc.
Scheduled personal property: Separate coverage for high-value items, such as expensive jewelry, that exceed the limits of your policy or are otherwise excluded.
Contact us
If something is not clear when you are buying insurance, do not be afraid to ask us! A great insurance experience starts with a great agency, Hennessey, Thames and Leavitt Insurance Agency. You get outstanding coverage, great rates and service from a local independent agent who cares. You can reach us by phone at 601-636-5560, by email at info-hennessey@leavitt.com or come by the office and see us at 1001 Belmont Street. Check us out on Facebook or our website www.leavitt.com/vicksburg.
