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ACCIDENT
- An unexpected event, which
happens by chance and is not expected in the normal
course of events.
ACT OF GOD
- A sudden and violent act of nature, which could not
have been foreseen or prevented. Examples: flood,
earthquake.
ACTUAL CASH VALUE
- The current cost of replacing an article with a
similar one in the same condition. Any item has three
basic values: original cost, actual cash value, and
replacement value. For example, if you originally paid
$400 for your living room couch; its actual cash value
might be $175. But if it’s destroyed in a fire,
replacing it will cost you $800.
ACTUAL LOSS SUSTAINED
– a form of business interruption insurance that will
pay for the loss suffered by the policy holder during
the indemnity period and is not subject to any limit of
insurance in the declarations of the policy.
ADDITIONAL INSURED
- A person other than the named insured who is protected
by the terms of the policy. Most automobile policies,
for example, insure a specific individual as an insured,
but also insure anyone driving with that insured’s
consent. The additional insured may be “named” or
“unnamed.”
ADDITIONAL INTEREST
INSURED - Another person
or company who may be liable for an accident involving
an insured and who has been named as an Additional
Interest Insured under the policy.
ADDITIONAL PREMIUM
- An extra charge for an alteration, during the policy
period, which increases the hazard or the company’s
liability.
ADJUSTER
- person who investigates a loss
and negotiates settlement with the claimant on the
company’s behalf.
ALL RISK
- Coverage against loss or damage from all perils except
those specifically excluded.
AMOUNT OF RISK
- The company’s total liability
at a specific location.
APPLICATION (APP)
- A form on which the prospective insured states facts
requested by the insurance company and on the basis of
which (together with any information from other sources)
the insurance company decides whether or not to accept
the risk, modify the coverage offered, or decline the
risk.
APPRAISAL
- A valuation of property made
for determining its insurable value or the amount or
loss sustained.
ARSON
- The willful and malicious
burning of property.
ASSUMED LIABILITY
- Liability, which would not rest upon a person except
that he has accepted responsibility by contract
expressed or implied. This is also known as contractual
liability.
ASSURANCE
- Same as “insurance.”
ASSURED
- Same as “insured.”
ASSURER
- Same as “insurer” (insurance
company).
AS THEIR INTEREST MAY
APPEAR - Phrase commonly
used in the loss payable section of an insurance policy
where the insurable interest in a property is either
unknown or presently not ascertainable, e.g., “Loss
payable to A and B as their interest may appear.” This
leaves the whole question of title to the insurance
monies to be settled between the insured and the person
whose name appears in the loss payable portion of the
policy.
AUTHORIZATION
- The power or right to act on
behalf of another.
AVOIDANCE OF RISK
- Taking steps to remove a hazard, engage in an
alternate activity, or otherwise end a specific
exposure.
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