42 terms
- Actual cash value (ACV)
- Replacement cost minus depreciation. Many policies pay ACV first and the rest after repairs.
- Additional living expense (ALE)
- Coverage for the extra cost of living elsewhere while a home is being repaired after a covered loss.
- Amount of loss
- The dollar value of a covered loss. It’s the only question an appraisal panel decides.
- Appraisal award
- The written decision signed by two of the three panel members that sets the amount of loss.
- Appraisal clause
- The policy condition that lets either party demand appraisal when they disagree on the amount of loss.
- Appraiser
- The person each side names to value the loss during appraisal. Usually required to be competent and disinterested.
- Bureau of Insurance
- The division of Virginia’s State Corporation Commission that regulates insurers, agents and public adjusters.
- Coinsurance
- A commercial policy clause that reduces payment if a building was insured for less than a set percentage of its value.
- Collateral damage
- Damage to soft metals, screens or other items that helps confirm a storm’s date and severity.
- Coverage A
- Dwelling coverage on a homeowners policy: the house and attached structures.
- Coverage B
- Other structures coverage, such as detached garages, sheds and fences.
- Coverage C
- Personal property coverage for contents.
- Debris removal
- Coverage for removing debris after a covered loss. Tree removal often has separate, lower limits.
- Declarations page
- The summary page of a policy listing the insured, limits, deductibles and endorsements.
- Deductible
- The share of a covered loss the policyholder pays before the insurer pays.
- Depreciation
- The reduction in value from age, wear and obsolescence used to calculate actual cash value.
- Derecho
- A long-lived, widespread windstorm from a line of thunderstorms, such as the June 2012 storm across Virginia.
- Disinterested
- Having no financial stake in a claim’s outcome. Many appraisal clauses require it of each appraiser.
- Endorsement
- A form that adds to, removes or changes the terms of the base policy.
- Estimate review
- An independent, line-by-line check of an insurer’s estimate against the damage and local pricing.
- FAIR Plan
- A state insurance pool for owners who can’t find coverage elsewhere. Virginia’s is the VPIA.
- Functional damage
- Damage that affects how a material performs, such as water-shedding or service life, as opposed to cosmetic damage.
- Hurricane deductible
- A separate deductible, often a percentage of Coverage A, that applies to losses from a hurricane or named storm.
- Like kind and quality
- The standard for replacement materials: comparable in type and quality, not necessarily identical.
- Line item
- A single priced entry in an estimate, such as a quantity of shingles or a room of drywall.
- Matching
- Whether new materials can reasonably match undamaged materials, a common dispute after partial damage.
- Mitigation
- Steps to prevent further damage after a loss, such as tarping or water extraction. Usually required and reimbursable.
- Named storm
- A tropical storm or hurricane named by the National Hurricane Center. Often the trigger for a separate deductible.
- Ordinance or law coverage
- Coverage for added costs of meeting building codes or local rules during repair, usually with its own limit.
- Overhead and profit (O&P)
- A general contractor’s markup for coordinating multiple trades, often 10% and 10%.
- Proof of loss
- A sworn statement of the amount claimed. Many policies require it within a set time after the insurer requests it.
- Public adjuster
- A professional licensed by the Bureau of Insurance to handle and negotiate a claim for the policyholder for a fee.
- Recoverable depreciation
- Depreciation held back from the first payment and paid once repairs are completed.
- Replacement cost value (RCV)
- The cost to repair or replace damaged property with like kind and quality, without deducting depreciation.
- Scope of loss
- The list of damaged items and the work needed to repair them.
- Square
- A roofing unit equal to 100 square feet of roof surface.
- Steep charge
- Extra labor added to an estimate for roofs too steep to walk safely, often 7/12 pitch and up.
- Suit limitation
- The policy deadline for filing a lawsuit against the insurer, commonly two years in Virginia.
- Supplement
- A request for additional payment for items missing from or underpriced in the original estimate.
- Umpire
- The neutral third member of an appraisal panel who decides items the two appraisers can’t settle.
- VPIA
- The Virginia Property Insurance Association, Virginia’s FAIR Plan.
- Xactimate
- Estimating software widely used by insurers and contractors to price repairs by region.