Property Insurance
Tel: 01202 754900
Email: quote@alan-thomas.co.uk

Specialist residential and commercial property insurance brokers UK

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Glossary of Terms


Our policies are very easy to understand, however some Property Insurance terms and phrases still need explaining. Please have a look at our Glossary of Terms below to help you understand your Property Insurance Policy.

WORDS

MEANING

Accidental damage cover

This is available as an optional extension to individuals on a home insurance policy. It covers property damages that result from inadvertent and unforeseen incidents.

The cover may be a contents accidental damage extension if a household item is damaged; or a buildings accidental damage extension if a building material is damaged.
Accidental damage excess Excesses that may be identified during an accidental damage claim.
Act of god An occurrence that cannot be established to be the result of human action, like a lightning strike. The details of your policy determines which (if any) of these occurrences are insurable.
Amendment Any measure of adjustment or edit carried out on the content of your original policy.
Annual premium Payment by a policyholder payable to the insurance firm every year, which covers the cost of the insurance policy being held.
British Isles The geographical expanse incorporating the distinct regions of England, Wales, Scotland, the Channel Islands, the Isle of Man, the Republic of Ireland, and Northern Ireland.
Broker An independent professional who prepares and sells insurance policies fulfilled by several insurance companies to insurance buyers.
Buildings Extensive term to describe all existing physical constructs within the boundaries of your property or estate. You are legally responsible for these structures, which include but are not limited to; drives, fences, fittings and services, fixed solar panels and swimming pools, fixtures, garden, gates, hedges, hot tubs, paths, patios, saunas, sport areas, and wind turbines.
Buildings accidental damage Available as an optional extra to individuals servicing a home insurance policy. It covers damages to building structures that may occur from non-deliberate events, like drilling into a pipe.
Buildings insurance

An insurance policy for a building, including its fittings, fixtures, and outbuildings to cover the costs of damages that may occur if an insured event occurs.

Events that are insurable include, escape of water, fire, subsidence, theft, vandalism or storm/flood. It is often necessary when acquiring a mortgage.
Building sum insured The total cost to knock down, remove, and reconstruct your property after an insured event has occurred.
Business An individual’s trade, firm, profession, or employment.
Business contents Structures, tools, and paraphernalia used to run a business, ply a trade, or fulfil professional duties of you and/or your family. These contents include fittings, fixtures, furniture, office equipment, tools, and stationary: they either are owned by, or may be the legal responsibility of you and/or your family.
Cancellation Termination of your insurance policy. May be associated with cancellation fees and charges if done prematurely (before your policy was documented to end).
Certificate of insurance A legally binding document issued by an insurance company to attest that an insurance policy is effective.
Claim A process undertaken by a policyholder to receive indemnity or pay-out from the insurer, in clear connection with the terms of the insurance policy.
Claims history Records of the number of claims initiated by an individual and the reasons why the claims were initiated. Insurance companies check the records before deciding on how much to charge an individual for his or her insurance premium.
Compulsory excess A pre-set amount stipulated in the details of an insurance policy that a policyholder is liable to pay when a claim is requested.
Contents

Include high risk items, personal effects (wheelchair, walking cane, clothing), and household goods (lawn mower, kitchen appliances) that are either owned by or for which legal responsibility is attributed to you, your family, and/or resident domestic staff.

While these effects may include the personal belongings of visitors, there may be limits attached, which in any case, will clearly be elucidated in your policy booklet.
Contents in the open Items which may be accurately defined as contents but which are specifically located in an area outside the confines of your home, whilst remaining within the boundaries of your estate.
Damage Harm to an individual or loss of property.
Defaqto

An individual adept in independent research and having relevant knowledge and expertise about financial products. Such individual is capable of providing vital information to help consumers make better financial decisions.

Consumers are able to ascertain the quality of a product as well as how well the product stacks up against the competition in terms of comprehensiveness, features, and quality. These are all possible using a star ratings process.
Depreciation Refers to definite reduction in the value of an insured entity following wear and tear, and incorporating the influence of economic factors.
Duty of disclosure An obligation of policyholders to inform insurers when there are changes that affect an effective insurance policy.
Escape of water The process of seepage of water from a fixed installation like a radiator, bath, or shower; and the damages that result.
Excess A fixed extra charge payable by a policyholder when requesting for a claim. Say in a situation where repairs for roof damage cost £1,000, a policy excess of £100, requires the policyholder to make a claim for £900, while making payment of £100.
Exclusions Types of risk, damage, and loss that are not covered in a policy plan, for which an insurer is not liable to provide claims for in the event that they occur. Exclusions are always clearly spelt out in the terms and conditions of all policies.
Financial Conduct Authority A government institution that concerns has the legal jurisdiction to regulate the activities of companies providing financial services, including insurance firms.
FLEA cover A less detailed form of insurance available for properties that are unoccupied as at the time of filing for the insurance. It provides insurance cover against earthquake, explosion, fire, and lightning.
Good state of repair A property devoid of structural defects and issues, including but not limited to, faulty wiring, rot.
Heave A vertical upward movement of the ground surrounding a property. It may result from the removal of large trees.
Insurance Premium Tax (IPT) Additional tax levied by the government, which is part of the final cost of a home insurance policy.
Insurer Usually a company, but also a person, that provides an insurance cover for an item or person against damage or loss.
Joint proposer When there is a collaboration of two individuals to finance a property insurance policy jointly.
Keycare Very specific protection policy against possible loss of keys. The policy usually covers the cost of replacement and reprogramming of lost keys, and often includes coverage for car keys.
Landslip Opposite of heave. Refers to downward vertical movement of the ground surrounding a property. It may result from occurrence of excessive rainfall leading to rock or soil slip.
Listed buildings Builds of vital historical and/or architectural significance that have legal protection against alterations, unless approved by the Department of the Environment.
Locks A security mechanism with special application in securing doors and windows in homes. Policies differ in the kind of support they have for locks, which is often limited to either one or a few types.
Loss assessor A professional who is apt at negotiating a claims process. A loss assessor is hired by a policyholder after filing a claim to act as an advocate on your behalf during the claim process.
Material fact Specific information that play a significant role in helping an insurer come to an informed decision on the appropriate insurance cover to award you and/or the cost of your premium. Failure to disclose this information may lead to voidance of a policy after discovery.
Mortice lock A lock standard which is commonly used for front and back doors. It is recommended that homes make use of the British Standard five lever (there are two, three, and five levers available) mortice lock for all external doors.
No claim discount A part of the terms and conditions of an insurance policy, indicating a discount which the policyholder is liable to receive in the eventuality that no claims were filed during the period of cover of the policy.
Optional extras Benefits that may or may not be included to a main policy. If selected, optional extras have special costs and would be effective for the duration of the main insurance policy.
Period of cover The length of time extending from the date of commencement of a policy to its end, stipulated in the home insurance schedule.
Policyholder An individual who acquires an insurance policy and has to make annual premium payments.
Premises The property covered by an insurance policy. The policy schedule holds the requisite details of the premises.
Premium The annual cost made payable to an insurer for the duration of an insurance policy to insure your property.
Property owners’ liability cover Offers protection to a property owner, such that he or she is exempt from lawsuits pertaining to accidents that occur to individuals while on the covered property.
Quote Total cost (annual premium and cumulative total over the period of cover) and details (terms and conditions) presented to a potential policyholder by an insurance company. This information is provided after insurance cover enquiries have been made for a property.
Rebuild cost

An all-inclusive cost that represents the total financial burden brought about by rebuilding a property that has been damaged or destroyed by an insured event—like a fire, earthquake, or flood. The rebuild cost factors the cost to clear the site and associated legal fees.

For individuals who have mortgage on a property, the property’s rebuild cost will be indicated on the lender’s valuation report.

To obtain an accurate estimate of the rebuild cost, you would have to hire a surveyor. Market price and rebuild cost are not the same.
Renewal The process and time at which a policyholder is required by an insurer to renew an effective insurance policy for another year.
Representative APR Total amount of money owed inclusive of interest and additional fees incurred over a one-year period.
Risk A concept used by insurance underwriters to predict the likelihood of a policyholder filing a claim, and the monetary cost of the claim if filed. This information allow underwriters to ascertain the premium a policyholder is required to pay.
Sanitary fittings Includes items such as bathroom and kitchen sinks, baths and bath panels, bidets, lavatory pans and cisterns, shower screens, shower screens. Swimming pools do not count as a sanitary fitting.
Schedule A detailed document that holds the personal details of the policyholder as well as the terms and conditions of an effective policy.
Single article limit (SAL) Maximum value of a single article within a section covered by a policy. If an article/item is valued at a price above the limit, then it has to be disclosed to the insurer, so that a suitable rate can be calculated.
Subsidence Downward vertical movement of soil that is unstable beneath a building.
Sum insured The final cost for which a property/building is insured by a policy.
Tenure The relationship of an individual to their home. For example, an individual’s tenure is referred to as an owner-occupier, if the individual is both the owner and tenant of the home.
Trace and access Process of ascertaining all leaks present in a property as well as access and repair.
Underinsurance Describes a situation where the sum insured for a property is insufficient to cover the full cost of rebuilding a property and replacing all the contents.
Underwriter The company offering the insurance cover for a certain policy.
Unoccupied Describes a scenario where a property does not serve as a regular living quarters for any individual during the day and overnight.
Voluntary excess

Refers to an additional amount payable by a policyholder in addition to the compulsory excess charged when a clam is requested. Voluntary excess is optional without any obligation. However, making a pledge for payment excess can lead to downward review of the normal insurance premium.

It is important to make certain that your existing insurance policy has support for any of the above solutions. Furthermore, it pays to take necessary time to read and comprehend your insurance policy well.
Year built Year in which the building process was completed prior to any repairs or rebuilding efforts, for a property being covered by a policy.

Which one is not a colour?

Why choose Alan & Thomas?
  • Free no obligation review and quotation
  • Dedicated property insurance advisers to guide you through the process
  • Competitive premiums from leading UK property insurance providers
  • Insurance cover tailored to your specific requirements
  • In-house claims team to manage any claim for you
  • Payment of premium by monthly instalment available
  • Free access to online risk management services
  • Top 100 UK independent broker* with Chartered Insurance Broker status

* Top 100 Independent Brokers 2016 published by Insurance Age in association with Cornell Consulting

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