Understanding your insurance policy can sometimes feel like trying to decipher a foreign language. With terms like “deductible,” “premium,” and “liability” thrown around, it’s easy to feel overwhelmed. But knowing these key terms is crucial for making informed decisions about your coverage and ensuring you’re adequately protected.

Whether you’re reviewing your homeowners policy, your commercial coverage, or your auto insurance, these terms will help you feel more informed the next time you speak with your insurance agent.

At The Camille Bunicci Agency, we believe in empowering our clients with knowledge. That’s why we’ve put together this straightforward guide to common insurance terms. Consider this your cheat sheet to navigating the world of insurance with confidence!

A–Z Glossary of Common Insurance Terms

Actual Cash Value
The current value of your property after accounting for depreciation. This is typically less than the cost to replace the item new.

Certificate of Insurance (COI)
A document that provides proof of your insurance coverage, often requested by clients, landlords, or contractors.

Claim
A formal request you make to your insurance company for payment after a covered loss.

Collision Coverage
Pays for damage to your vehicle when it hits another vehicle or object, regardless of who was at fault.

Comprehensive Coverage
Covers damage to your vehicle caused by something other than a collision, such as theft, fire, vandalism, or weather events.

Deductible
The amount you must pay out of pocket before your insurance begins to pay for a covered loss.

Endorsement (or Rider)
An addition or amendment to your policy that modifies coverage. It may add, remove, or change specific protections.

Exclusion
A condition or situation that is not covered by your insurance policy. Understanding exclusions helps identify where additional coverage might be needed.

Liability Coverage
Protects you if you are found responsible for causing injury or property damage to someone else.

Peril
A specific cause of loss, such as fire, windstorm, theft, or flood.

Policy Limit
The maximum amount your insurance company will pay for a covered loss.

Premium
The price you pay for your insurance policy, typically monthly, quarterly, or annually.

Replacement Cost
The amount it would take to replace your property with a new item of similar kind and quality, without deducting for depreciation.

Subrogation
When your insurance company seeks reimbursement from another party that caused the loss after paying your claim.

Umbrella Policy
Provides additional liability protection that goes beyond the limits of your existing home, auto, or business policies.

Underwriting
The process insurers use to evaluate your risk and determine your eligibility and premium.

Demystifying Your Insurance Coverage

While this glossary covers many of the basics, remember that every insurance policy is unique. Understanding these terms is a fantastic starting point to feeling more confident about your insurance choices.

Don’t let insurance jargon leave you guessing. If you have questions about your current policy or need help understanding specific terms related to your coverage, the team at The Camille Bunicci Agency is here to help. Contact us today for personalized guidance and clear answers.