Insurance Glossary

Plain-English definitions for 59+ insurance terms. No jargon to explain jargon — just clear answers so you can understand your policy with confidence.

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A

Actual Cash Value

A method of valuing damaged or destroyed property that accounts for depreciation.

Home Insurance

Additional Living Expenses

Coverage that pays for the extra costs of living away from your home while it is being repaired after a covered event.

Home Insurance

D

Dwelling Coverage

The portion of your homeowners policy that pays to repair or rebuild the physical structure of your home after a covered event.

Home Insurance

F

Flood Insurance

A separate insurance policy that covers damage to your home and belongings caused by flooding.

Home Insurance

H

HO-3 Policy

The most common type of homeowners insurance policy in the United States.

Home Insurance

HO-5 Policy

A premium homeowners insurance policy that provides open-peril coverage for both your home's structure and your personal property.

Home Insurance

P

Personal Property Coverage

The portion of your homeowners or renters policy that covers your belongings — furniture, electronics, clothing, and more — if they are damaged, destroyed, or stolen.

Home Insurance

R

Replacement Cost

A method of valuing damaged or destroyed property based on the cost to replace it with a new item of similar kind and quality, without deducting for depreciation.

Home Insurance

U

Umbrella Policy

A supplemental liability insurance policy that provides coverage above and beyond the limits of your homeowners, auto, or boat insurance.

Home Insurance