Glossary of Terms

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Glossary of Terms

At Cassel & Cassel, we strive to make the claim process as pain-free and easy to understand as possible.  Below is a glossary of terms commonly used throughout property insurance policies and claim correspondences.  Please note that this is not meant to be an exhaustive list and these terms are defined generally as individual policies may contain alternative definitions.  If you have any questions regarding the definitions below or their application to your claim/policy, do not hesitate to contact one of our attorneys for a free consultation. 


Actual Cash Value (“ACV”):  The value of a claim minus depreciation.

Additional Living Expenses:  Any increase in living expenses incurred by a policyholder so as to maintain the normal standard of living when the insured property is not fit to live in.  This can include the cost of food, the cost to rent temporary housing, etc.

All-Risk Policy:  An insurance policy which provides coverage for all types of losses unless otherwise excluded in the policy.  All-Risk Policies differ from Named Peril Policies discussed below.

Appraiser:  The person hired by the policyholder or insurer to represent their party in the appraisal process.  The appraiser's duties may include performing inspections, hiring experts, drafting estimates, and presenting to the umpire.

Appraisal: An alternative dispute resolution process available to policyholders after coverage has been afforded.  The language regarding appraisal varies from policy to policy so it is important to read the policy language carefully. 

Assignment of Benefits (“AOB”):  A document by which a policyholder (“Assignor”) can assign a portion of its coverage to a third-party (“Assignee”), typically a contractor to perform some kind of emergency services such as water or mold remediation.  The assignee would then be able to seek recovery from the insurance company independently of the policyholder.  

Attorney's Fees:   The amount of money owed to an attorney after services have been rendered.  In Florida, Section 627.428, Florida Statutes, mandates that insurance companies must pay attorney's fees if litigation is involved.  Our attorney's fee contract is always contingent upon recovery on behalf of our clients.

Bad Faith:   The violation of Florida Statutes governing the timely and proper adjustment practices of insurance claims.  Typically, bad faith can include unwarranted delay or denial of insurance benefits, unfair or deceptive practices, and misrepresentations of fact.  Depending on the magnitude of the bad faith, Florida Statutes allow for the recovery of extra-contractual damages (damages beyond the terms of the insurance policy) and/or punitive damages.

Business Owners Policy:   An insurance policy specific to businesses which typically provide coverage for inventory property and business interruption.

Catastrophe Loss:   Also called a “CAT” claim, this includes large losses resulting in massive damage such as tornadoes, floods, and hurricanes.

Civil Remedy Notice (“CRN”):   An administrative complaint filed with the Florida Department of Financial Services which outlines the allegations of bad faith against an insurance company. 

Claim:   The process by which a policyholder submits a loss to their insurance company under an insurance policy and demands payment for the damages sustained. 

Coinsurance:   Usually found in commercial policies, the percentage of value that the policyholder is required to insure.  If a property is not insured to the full coinsurance value, there may be significant penalties levied against the policyholder by the insurer reducing the overall payment of policy benefits. 

Costs:   The money that must be paid to third-parties such as contractors, estimators, consultants, or experts, to assist in the presentation of a claim or the prosecution of litigation.  Some costs may be covered by your insurance policy or may be recoverable by the prevailing party in litigation.

Declarations:   Also called the “Dec Page,” this is where the information specific to your policy is found such as the policy number, the names of the insureds, the insured property address, the effective dates of coverage, and the types of coverages, limitations, and deductibles.

Deductible:   The amount by which the initial payment of policy benefits will be reduced.  Most policies have a different deductible amounts for hurricanes as opposed to other types of losses.

Depreciation:   The decrease in the value of property over time.

Estimate:   The document prepared on behalf of either the policyholder or insurance company which forms the basis for the demand or payment of benefits.  Estimates can be prepared by public adjusters, field adjuster, independent adjusters, loss consultants, or general contractors.

Examination Under Oath (“EUO”):  The proceeding where an insured or their representative is sworn in under oath questioned by a court reporter and questioned by a representative of the insurance company, usually an attorney or adjuster. 

Exclusions:   The provisions in an insurance policy which outline situations where coverage is not afforded. 

Fair Rental Value:   The value of property rented to others which may be recoverable if the property becomes unfit to live in as the result of a loss or claim.

Field/Independent Adjuster:   An adjuster sent by an insurance company to assess the value of a loss/claim.  A “field” adjuster is typically employed by the insurance company directly and an “independent” adjuster is typically contracted by an insurance company to work on specific claims.  Neither a “field” adjuster nor an “independent” adjuster work on behalf of the policyholder.

​Fraud:   Any statement containing false, incomplete, or misleading information provided knowingly and with intent to injure/deceive.

Internal Adjuster:   Also called a “desk adjuster,” an adjuster employed or contracted with the insurance company who represents the insurance company in the claims process.  The internal adjuster

Insured:   Also called the “policyholder,” the person(s) or entity covered by an insurance policy.

Insurer:   Also called the “insurance company,” the company licensed and authorized to provide property and casualty insurance.

Limit of Insurance:   The highest amount that can be paid in coverage under an insurance policy.  Certain limits can apply to individual losses or to the entire policy period and some limits can be increased depending on the language of the limiting provision.

Loss of Use:   The additional living expenses incurred or fair rental value lost as a result of a covered claim.

Material Misrepresentation in an Application:   The misstatement of information, regardless of intent, in an application for insurance which is material to the insurance company's acceptance of the risk.  

Mediation:   An alternative dispute resolution process available through policy and law where, in front of a mediator certified by the Supreme Court of Florida, the policyholder and their representatives can openly discuss their claim with the representatives of the insurance company in a confidential setting.

Mortgagee:   The bank or institution which holds a mortgage on the insured property.  Due to the mortgagee's interest, they must be named as a payee on any coverage check related directly to the property. 

Named Peril Policy:   An insurance policy which provides coverage only for specific types of perils listed therein. 

Option to Repair:   Sometimes called the “right to repair,” this is a policy provision which allows the insurance company to select their own contractors and repair any damage in lieu of tendering monetary payment.  Often, the insurance company will require the policyholder to pay the deductible prior to commencing the covered repairs. 

Ordinance and Law Coverage:   An additional percent of coverage above the limit of liability to account for the enforcement of any ordinance or law regulating the construction and/or repair of a damaged building.

Personal Property:   Items within a property that are movable such as clothes, furniture, etc.

Policy:  A written contract between an insured and insurance company containing the terms, provisions, conditions, exclusions, and limitations of an insurance agreement.

Post-Loss Conditions:   Also called “Duties After Loss,” the specific conditions in the policy which dictate what must be done in the event of a loss.  Insurance policies contain two (2) types of post-loss conditions: compulsory conditions,  i . e ., conditions that must be fulfilled with or without the request from an insurer such as provide prompt notice or protect the property from further damage, and post-loss cooperation conditions,  i . e ., conditions that must be fulfilled upon the request of an insurer such as provide documents requested or allow the damaged property to be inspected. 

Prejudice:   In the context of insurance, it is the harm or injury sustained by the insurance company as a result of a policyholder's failure to comply with post-loss conditions.  Prejudice may be used as a basis for the denial of a claim.

Premium:   The amount paid as consideration to effectuate insurance coverage.

Prompt Notice:   Notification to an insurance company of a loss or damage within a reasonable amount of time in light of all the facts and circumstances of the claim.

Proof of Loss (“POL”):   Sometimes called a “Sworn Proof of Loss,” a sworn written statement containing a formal accounting of the total damages sustained as a result of a loss or claim.  A Proof of Loss may be required without written notification and must be timely provided pursuant to the governing policy or written request from an insurance company.

Public Adjuster (“PA”):   a licensed individual that adjusts insurance claims on behalf of the policyholder.  Public adjusters never represent insurance companies.

Remediation:   Also known as “mitigation,” the process by which water, mold, smoke, or other potentially harmful substances are removed from a property, often in order to prevent further loss.

Replacement Cost Value (“RCV”):  The cost of replacing the property loss or damage without a reduction for depreciation due to normal wear and tear or age.

Supplemental Claim:   The reopening of a claim after the initial undisputed payment has been tendered.  Supplemental claims may involve policyholders providing additional documents such as estimates or reports to the insurer and additional adjustment/investigation on behalf of the insurance company.

Surplus Lines Carrier:   Insurers located outside of Florida but licenced to issue policies throughout the state.  In many situations, Surplus Lines Carriers do not follow the same laws as in-state insurers.

Third-Party Administrator (“TPA”):   Organizations that process, administer, and adjust claims on behalf of insurance carriers, typically surplus lines carriers.

Umpire:   The neutral party who oversees the appraisal process.  Typically, if either party's appraiser agrees with the umpire, the final award is binding on all parties.  

​Undisputed Payment:   The coverage amount unilaterally determined by the insurance company.  An undisputed payment is not necessarily the full and final amount of coverage owed.

Valued Policy Law (“VPL”):   A Florida law which states that, in the event of a total loss, the policy limits must be paid in full.

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