Comparing business insurance quotes online with us couldn't be easier, however sometimes policies include legal jargon that isn't so clear. Here we'll cover some of the most common insurance terms and what they mean:
Addendum - A legal document which details any changes to an insurance contract.
Cancellation - The process of ending a policy before its set expiry date.
Certificate of Insurance - This is a legal document that may be used as evidence of the policy being taken out. This will hold basic information, such as the name of the policy holder and the date the cover was taken out.
Claim - This is the term given to the process of seeking compensation.
Concealment - The act of intentionally hiding information which could relate to the risk covered by a policy.
Consequential Loss - The loss incurred after the claim event. This could be due to a damaged premises, product or equipment.
Deductible (excess) - This refers to the voluntary or compulsory excess which must be paid before a claim is secured. For example, if you make a claim for £25,000 and the deductible excess is £1,000, you will have to pay this £1,000 before the remaining £24,000 will be transferred to your account.
This deductible amount will be different with each policy, however, the higher this figure is the lower the policy cost usually is.
Exclusions - Conditions that refer to any items or instances that are not covered by a policy.
Inception Date - The policy commencement date.
Indemnity Period - A space of time when cover is provided by a business insurance policy.
Insurance Premium Tax - This is a UK government tax on basic insurance premiums that was introduced in 1994.
Lapse - When an insurance policy is not renewed.
Limit - The maximum liability under a policy, as per event or per annum.
Loss - A claim on an insurance policy.
Material Fact - Information that could influence whether an insurer accepts or declines a risk.
Negligence - When a duty of care is not upheld and damage occurs as a result.
Period of Risk - The time frame where an insurer is liable.
Policy - The legal document which details the terms and conditions of an insurance contract.
Premium - The cost of insurance - usually monthly or annually.
Quote - A statement of the premium required to take out a policy.
Risk - The likelihood that an insured event will occur.
Sum Insured - The maximum amount that could be paid out per claim.
Underwriter - The person who evaluates the risk of a policy.
Vis Major (or act of god) - This refers to events that are outside of human control, where no one can be held responsible. This could refer to natural disasters; such as storm or flood damage.
Warranty - A guarantee that certain facts are true and actions will happen.
Wear and Tear - Any general damage that can occur from continued use.
Have More Questions?
If you would like to compare insurance policies and discover what premium you could be paying for business insurance, get quotes online today with us.
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