Insurance Glossary

100 Percent Coinsurance – A policy condition requiring insurance equal to 100% of value to avoid reduced claim payment. In plain language: 100 Percent Coinsurance means the policy expects the insured to carry coverage equal to the full value of the property being insured. If the building or business personal property is insured for

1996 Health Insurance Portability Act – A Landmark Law in the US Health Sector In plain language: HIPAA, or the 1996 Health Insurance Portability Act, is a law implemented to make health insurance coverage easier to move from one job to another and to protect patient privacy by setting rules on

1st Party Claim – A claim an insured makes under their own policy for a covered loss to themselves or their property. In plain language: A 1st Party Claim is when you ask your own insurer to pay for a loss that your policy covers. Think of it like using a

3 Ds – A shorthand phrase describing how insurers are accused of handling claims through delay, denial, or defense. In plain language: The 3 Ds is a phrase people use when they believe an insurance company is making a claim harder by slowing it down, refusing it, or fighting it. Think

3pl – A logistics company that stores, handles, and ships goods for another business under a service agreement. In plain language: A 3pl is a company another business hires to handle some part of storing, moving, packing, or shipping products. Think of it like outsourcing the back room, loading dock, and shipping desk to a

3rd Party Liability – Legal responsibility for injury or damage suffered by someone other than the insured or insurer. In plain language: 3rd Party Liability means you may owe money when your actions, your property, or your business causes harm to someone else. Think of it as the part of liability insurance that

401(k) Contributions – Payroll and Benefits Considerations In plain language: 401(k) contributions are the money employees choose to put from their paycheck into their 401(k) retirement account. This can significantly help in building their financial future.  Technical definition: 401(k) contributions denote the pre-tax portion of an employee’s payroll that is voluntarily deferred into a 401(k) plan, engineered for

80 Coinsurance – A property insurance requirement to carry at least 80% of value to avoid reduced claim payment. In plain language: 80 Coinsurance means a building or business property should usually be insured for at least 80% of its value for a full claim payment on partial losses. Think of it like

A Side Coverage – D&O Protection for Individual Directors In plain language: A Side Coverage is a part of Directors & Officers insurance (D&O insurance) that pays for legal defense and settlement costs for individual directors and officers when their company can’t or won’t pay. Think of it as a safeguard for a director’s personal assets.  Technical

A.M. Best Company Rating – A Measure of Insurer Financial Strength In plain language: A.M. Best’s ratings show how strong an insurance company is financially. It’s similar to how a school report card grades a student’s performance. Insurance companies with good ratings have the money to pay claims and stay in business.  Technical definition: A.M.

Abandonment – Relinquishing Property Rights In plain language: Abandonment in insurance refers to when a policyholder aims to give up their rights to a property to an insurance company, usually after a significant loss. Imagine if your car was vandalized beyond repair, and instead of claiming for its value, you simply wanted to hand

Abduction – The wrongful taking or detention of a person without legal authority or consent. In plain language: Abduction means taking, keeping, or moving a person without the right to do so. In everyday terms, think of it as removing someone from where they are supposed to be and controlling their

Abrupt Collapse – A Coverage Trigger in Property Insurance In plain language: Abrupt collapse means a building or structure suddenly falls down, caves in, or loses its shape so drastically that it can’t be used for its intended purpose anymore.  Technical definition: In property insurance policy, an abrupt collapse indicates a sudden falling or caving in of

Absolute Liability Insurance – Coverage concepts tied to liability imposed without traditional fault analysis in certain legal or statutory situations. In plain language: Absolute Liability Insurance refers to insurance discussions around situations where a person or business can be held responsible for injury or damage without the usual need to prove

Accident – Unexpected Event Causing Loss In plain language: An accident is an unexpected and unintended event that causes harm, damage, or loss. It’s like a spilled glass of milk that wasn’t planned and ends up making a mess.  Technical definition: In insurance terms, an accident is an unforeseen, involuntary event leading to an injury or property damage,

Account Executive – A Key Role in Insurance Sales In plain language: An account executive is a sales professional who works for an insurance agency. They are responsible for managing relationships with a set of clients, guiding them through the insurance buying process, and ensuring they have the right coverage to meet their

Account Manager – Servicing and Retaining Clients In plain language: An account manager in insurance serves as the main point of contact for clients, ensuring they have the right coverage, promptly handling their concerns, and maintaining the business relationship.  Technical definition: In an insurance setting, an account manager is a highly skilled professional responsible

Account Rounding – A Strategy for Cross-Selling to Increase Account Valu In plain language: Account rounding is when an insurance agent or broker tries to sell more insurance products to their existing clients. It’s like when a waiter asks if you want dessert—customers might not have thought of it, but it could be

Accountant Liability – Legal and financial responsibility accountants may face when their work causes client or third-party harm. In plain language: Accountant liability is the risk that an accountant or accounting firm can be held responsible for mistakes, missed issues, or misconduct in professional work. Think of it like a design

Accounts Receivables – Money owed to a business by customers for completed sales or services not yet paid. In plain language: Accounts Receivables means money a customer still owes after a business has already done the work or delivered the product. Think of it like sending an invoice after painting a