A Guide to Home Insurance & Saving with Online House Insurance Quotes
Glossary of House Insurance Terms
The Association of British Insurers is a trade body representing the interests of the UK insurance industry. ABI carries out research and lobbies government on issues affecting insurers.
An adjuster, also known as a claims adjuster or loss adjuster, investigates and assesses insurance claims for insurance companies.
The British Insurance Brokers' Association is a trade body that represents insurance brokers and intermediaries.
The reduction of a claim by an insurer in relation to the degree of under-insurance. For example, if a house worth £60,00 is insured, subject to average, for £40,000, the insured will be entitled to only two thirds of any loss. Guard against under insurance by regularly checking the sum insured is adequate for replacement or rebuild costs. In practice commercial policies in general contain averaging clauses but those for domestic property do not and it may be possible to claim up to the maximum sum insured as opposed to a proportion thereof.
The sum insured for contents and buildings insurance is sometimes based on the number of bedrooms in the home.
Insurance which covers the fabric and structure of the home.
Insurance which covers the loss or damage to possessions in the home, often described as 'everything you would take with you were you to move house'.
The part of a claim that the insured rather than the insurer must pay. Also called the 'voluntary excess'.
A clause or usually clauses in an insurance policy or schedule to the effect that the insurer's liability is excluded in the circumstances specified.
An addition to an existing insurance policy.
The Financial Services Authority is the body responsible for the regulation of the UK insurance industry.
The insured must have an insurable interest in the property that is the subject of the insurance. By insurable interest is meant a demonstrable relationship or right in the property, or a right derivable out of some contract about the property. The principle of insurable interest applies equally to goods (or contents) as well as to property (or homes).
An insurance broker or 'insurance intermediary' earns a commission on the sale of insurance contracts. The broker will compare the products of some but by no means all insurance companies. Though an insurance broker sells insurance contracts these policies are underwritten by the insurer or 'insurance company'.
Insurance Premium Tax
A tax on general insurance premiums (including house insurance) as governed by the Finance Act (1994).
Anyone looking for house insurance quotes has a duty to inform the insurer of anything that might affect the insurance risk. Failure to disclose a material fact may be sufficient reason for an insurer to refuse a claim. Insurance companies must be informed of any changes in circumstances.
New for Old
Many contents insurance policies provide cover such that lost or damaged items will be replaced with new ones. The alternative is 'like for like' cover where items are, where possible, replaced with exact replicas.
If you are over-insured you will be paying for a higher level of cover than you actually need.
A document containing the exact terms of an insurance contract.
The person named in the policy document as the beneficiary of the insurance contract.
The amount payable by the policyholder to the insurer or broker for the insurance contract, usually payed every year or month.
The proposal form is a standard form produced by insurers. By completing the proposal form the insured is in effect offering to enter into an insurance contract with the insurer. The insurer may decline or accept the offer with or without qualifications.
Before a policy expires a renewal notice is sent out detailing the premium payable for the subsequent term.
The part of the policy document that contains the details of the insured including the property details and any particular terms of the contract.
The maximum amount an insurer will pay towards the claim on a house insurance policy.
An insurance intermediary who sells the products of a single or limited number of insurance companies.
If the sum insured is insufficient to cover the total amount suffered in loss or damage to goods or property the amount of the claim will be reduced in proportion to the level of under-insurance.
The term underwriter derives from the early days of marine insurance at Lloyds coffee house in London where those willing to accept the risks of a particular voyage literally wrote their names under a description of the ship's proposed adventure. Hence the underwriter assumes responsibility for the financial risks of an insurance contract.
Utmost Good Faith
From the Latin derrivation uberrima fides, referring to the principle of honesty and good faith in which the insurance contract is entered into by both the insurer and the insured. The duty of utmost good faith applies for the duration of the contract, not just at the time in which the proposal form is filled out. For example the policyholder has a duty to disclose all material facts to the insurer, and these may change over time. Cases of insurance fraud or misrepresentation of fact, whether negligent or otherwise, run counter to the principle of utmost good faith and will result in the contract being void.