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Homeowners Insurance Terms

Actual Cash Value (ACV) is what it would cost to replace your property minus depreciation, which is how much value the property has lost due to age and wear and tear.
Deductible is the amount of the damage or loss that you’re responsible for before your insurance company pays a claim.
Dwelling or Building Coverage is the part of your homeowners insurance policy that helps pay to repair the physical structure of your home if it’s damaged due to a covered loss.
Effective date is the date that your coverage goes into effect.
Exclusion is a type of loss or a cause of loss that is specifically not covered by your homeowners insurance policy. Your policy will have an exclusions section that will list losses that are specifically excluded.
Expiration date is the date when your insurance policy expires.
Flood insurance protects against damage from rising or overflowing bodies of water. Your homeowners policy usually doesn’t cover flooding, but you can buy flood insurance separately.
Insured means the policyholder(s), those protected in the event of a claim.
Loss Assessment is coverage for shared losses when your condo or home is part of an association.
Loss of Use is coverage that pays for additional living expenses, such as hotel costs and meals, if your insured residence becomes uninhabitable due to a covered loss and you temporarily relocate. This coverage is sometimes called additional living or temporary living expense.
Loss Payee is someone who has a financial interest in the property and can receive insurance payments in the event of a covered loss. Loss payees can include the property owners and mortgage company.
Medical Payment to Others is insurance that pays the cost of medical care to an injured guest in your home.
Ordinance or Law Coverage is additional coverage for rebuilding or repairing your home to meet current laws or building codes.
Other Structures is the part of your homeowners insurance policy that covers buildings on your property other than your home, such as a detached garage or shed.
Personal Liability is coverage that financially protects you in the event of an accident, whether at your home or away from it, that results in bodily injury or property damage that you’re legally responsible for.
Personal Property Coverage is for property in your home, such as furniture, clothing, and other items you own that are not buildings.
Replacement cost coverage is coverage that pays the replacement cost to replace or restore property back to the condition it was in before a covered loss.
Scheduled Personal Property If you have expensive items, such as jewelry or antiques, your homeowners policy may not be enough to cover the full replacement cost. For an additional premium, you can buy higher limits for scheduled personal property.
Water Back up & Sump Discharge or Overflow this optional coverage provides protection from water damage resulting from backed up drains, sewers, gutters, or failed sump pumps.