Insurance glossary
Short definitions to support our guides. Policy language always controls.
- Actual cash value (ACV)
- A claims settlement approach that pays the replacement cost minus depreciation.
- Additional insured
- A person or organization added to a liability policy for certain claims, common on contractor certificates.
- Bodily injury liability
- Coverage that can help pay when you are at fault for injuring someone else.
- Collision coverage
- Helps repair or replace your vehicle after a crash with another car or object, subject to a deductible.
- Comprehensive coverage
- Helps with non-crash losses such as theft, vandalism, fire, or hail, subject to a deductible.
- Declarations page
- The policy summary listing who is insured, coverages, limits, deductibles, and rating information.
- Deductible
- The amount you pay out of pocket on a claim before insurance contributes.
- General liability (CGL)
- Commercial coverage for many third-party bodily injury and property damage claims.
- Liability-only
- Informal term for an auto policy without comprehensive/collision on your own car.
- Personal liability (home/renters)
- Helps if you are legally responsible for certain injuries or property damage to others.
- Replacement cost
- A settlement approach that pays to replace property with new similar property, without deducting depreciation (policy terms apply).
- Term life insurance
- Life coverage for a set period; typically no cash value.
- Umbrella insurance
- Extra liability limits above underlying auto, home, or commercial policies.
- Uninsured motorist (UM)
- Can help you if an at-fault driver has no liability insurance (or in some hit-and-run cases).
- Whole life insurance
- Permanent life insurance that typically builds cash value and stays in force for life if premiums are paid.
- Workers’ compensation
- State-regulated coverage for employee work injuries and related benefits.