| To help prevent any unnecessary confusion
we have composed this handy glossary to make sure your head isn’t left in
a spin by any vague terms. Buildings cover- this type of insurance generally
covers the external skeleton of a building as well as any outbuildings and permanent
fixtures.
- Claim - a claim is the term used for the process
of a policyholder seeking monetary compensation under the terms and conditions
of a policy.
- Contents insurance - this type of household
insurance is generally covers the contents of a building from furniture to food
and clothes.
- Excess - excess is the amount of money that
you must pay before the rest of the claim is met by the insurer. You must agree
to pay the minimum excess but can also set your own, higher, voluntary level if
you so require.
- Exclusion - an exclusion is a particular incident,
person or thing that is not covered by the insurance policy.
- Household insurance - this is another term
for home insurance.
- Index linking - the process of index linking
means that insurers will automatically update your policy in league with inflation
and the cost of living.
- Insurance premium tax - sometimes shortened
to IPT, this is a tax imposed by the government on most insurance policies sold
in the United Kingdom.
- New for old - this term is often used in conjunction
with contents insurance. It means that any items damaged or lost will be replaced
with brand new entities.
- No claims bonus - a discount offered to policyholders
with a claim-free record.
- Policy - your policy is the document outlining
all the terms and conditions of the insurance agreement as agreed between the
insured and insurer.
- Policyholder - the policyholder is the insured,
the person to whom the insurance policy is issued.
- Premium - premiums are fees, usually paid annually,
made for the reciprocal protection of insurance.
- Sum insured - this term is used to refer to
the amount for which property is insured. The sum insured is the highest amount
that an insurer will pay out in the case of a claim.
- Underinsurance - this term is used to refer
to a case where property or a thing has been underinsured, and where the policyholder
would effectively not be sufficiently reimbursed for their loss.
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