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Additional Living Expense – Also called loss-of-use. This coverage pays for the extra, above normal costs of expenses such as food and lodging incurred while the policyholder’s home is being repaired. These expenses are generally not applicable to children living away at college.

All-Risk Policy or “Special Form” – Covers the loss of property or damage that results from any peril except those which are specifically excluded in the contract.

Cancellation – Termination of an insurance policy by the insurance company or policyholder before a policy expires.

Claim – A request for reimbursement for a loss covered by the policy. For example, a claim for items stolen from the policyholder’s home.

Deductible – The amount the policyholder must pay per claim or accident before the company will begin paying. Deductibles are fixed amounts specified in the policy.

Endorsement – A change added to an insurance policy which modifies the original terms.

Floater – Sometimes called a rider, this is additional coverage for special items such as expensive jewelry or antiques.

Insured Loss – A loss (theft, damage, etc.) that the insurance policy will pay for, in full or in part.

Liability – Any legal obligation.

Licensed – Agents and Companies – Agents and companies that are approved and monitored by the Department of Insurance to sell insurance in your state.

Limit – The maximum amount of benefits an insurance policy will pay in the event of a loss.

Named Perils – Specifically covered by a policy. For example, lightning and vandalism. (See “Peril”)

Package Policy – An insurance policy that includes several kinds of coverages. For example, a homeowners HO-3 policy includes living expenses, personal liability and medical payments.

Peril – The cause of a loss. Two examples are fire and theft.

Premium – What the policyholder pays for an insurance policy. Premiums are paid monthly or annually according to the payment plan offered by the company.

Risk – A chance of loss to insured persons, liabilities, properties or assets.


921 S. McPherson Church Road
Fayetteville, NC 28303-5368

Independent Insurance Group

Office: (910) 867-9500
Fax: (910) 867-9292 


HOURS: 8:00am - 5:00pm Monday -Friday