Replacement Cost is the reimbursement of the amount of money it would cost to repair/replace your property at today’s cost.

Actual Cash Value is the amount of money needed to repair/replace your property minus its decrease in value due to age or use.

A deductible is the amount of money that the insured person must pay before their insurance policy starts paying for covered expenses.

It is part of a contract that gives the right to seek compensation from the negligent party to the insurance carrier, instead of the insured doing so.

The “first named insured” is the insured listed first on the declarations page and holds the primary responsibility for the policy.

Yes, many insurance providers have different payment options such as pay in full or monthly. Many companies will provide a discount if the premium is paid in full.

Not necessarily, most policies renew each year but you will remain eligible as long as there has been continuing payments. It is recommended that you review your  coverage with your insurance representative each year.

When you sign the application with the insurance carrier, they have 60 days to inspect the property and determine if they want to continue. They can cancel the policy during those 60 days if they would like.

After 60 days they cannot cancel the policy due to the amount of claims made until the policy is renewed.

If you choose to pay your homeowners insurance through you escrow, a portion of your mortgage payment is set aside into your escrow account and this will automatically pay for insurance and property taxes when they are due.

It depends on the type of policy you have. If you have open/broad coverage it is likely covered. If you have purchased basic/fire only then it is likely not covered. It is recommended you speak to your insurance representative to discuss any coverages you may need.

Flood damage is not covered under homeowners policies. It may be added through a separate individual policy which can be provided by your carrier but is run through the National Flood Insurance Program.

In a homeowners policy the coinsurance is a clause that is used to ensure that policyholders insure their property closer to its actual value so the insurer receives a fair premium.

The recommended coinsurance is a minimum of 80%. In case of a loss after the deductible, the insurance will cover 80% of the loss and the insured the remaining 20% in this example.

Some common home insurance exclusions include floods, earthquakes, and sewer backups among others. If you need to protect your home against something your insurance doesn’t cover, you can add coverage through different endorsements and should ask your insurance representative.

The big difference between the three is how the building or dwelling is covered.  In a homeowners policy you own the building/dwelling so there are specific coverages.

In condo insurance the majority of the structure is not yours so the coverage largely extends to your area inside the building. If you are part of a condo association you may be assessed damages to shared spaces or the building through that association.

Renters insurance has similar coverages to a homeowners policy in terms of property/liability. It simply excludes the building or dwelling from the policy.

This pays for medical expenses, lost wages and funeral expenses in the event of an accident.

For example your vehicle according to Kelly Blue Book is worth $15,000,but you owe $20,000 in loans. In the event of a loss your insurance will only cover the vehicle’s value ($15,000), gap insurance would cover the remaining (5,000).

Typically your personal car insurance covers rental cars with the same limits and deductibles as your policy. This will only extend this coverage however if you are using the vehicle for personal use, such as while on vacation.

General Liability is often referred to as Business Liability and covers claims against the insured that include bodily injury and property damage that the insured may be found responsible for.

Covers the physical location of the business as well as inventory, furniture and tools. This policy typically covers replacement and repair costs in event of a covered loss.

A business owner’s policy is a basic policy that covers three parts of a business.  Property damage (building, furniture, inventory), business interruption covers lost business income due to a loss that is covered by the insurance carrier, and liability insurance which covers legal defense costs, judgments and settlements.

This protects from third-party lawsuits that are non-physical, such as slander, libel, false arrest and copyright infringement.

Commercial auto insurance provides liability and physical damage coverage for vehicles that are used for business purposes. If you are in an accident with your personal vehicle driving to a meeting with a client your personal auto insurance may not cover.

Cyber liability covers your business in the event of a cyber attack that leaks personal or financial information of your clients or business. This will cover the costs associated with the breach or lawsuits that may arise.

An additional insured is anyone on the policy other than the named insured who can be covered under the policy. Additional insureds can be added by endorsement and should be included if they have a business relationship with the named insured.

An umbrella policy will cover anything that is covered in the policy at higher limits. For example if your homeowners policy has a limit of $500,000 and there is a loss of $600,000 your umbrella policy will cover the remaining $100,000.

Workers compensation was created to guarantee employees medical benefits in the event of a work related injury, because this coverage is guaranteed through the policy the employee many of their rights to sue. This doesn’t mean that in events of negligence from the employer they can’t sue, but many policies have liability coverage that will respond to the suits.

Premium rates are typically based on factors such as age, gender, height, weight, health status (including whether or not you use tobacco), and if you participate in high-risk activities or occupations.

Most plans do require basic medical testing/information and charge premiums based on this information. If you do have a serious medical condition there are still options available it may come at an increased premium or limited coverage.

A life insurance beneficiary is an individual, entity, trustee, or estate named by the policy owner to collect the death benefit proceeds upon the insured’s death.

This covers charges and affairs associated with burial, funeral services or final medical bills. This is a fixed premium that lasts as long as the policy holder lives.