Insurance can be a complicated topic for many people. We developed this glossary to help you with some of the key terms and concepts.

Actual cash value (ACV)
This is a method used to figure the values for property when settling a claim. If your policy says it provides for Actual Cash Value settlement, it generally means that your policy will pay the depreciated cost of your property, up to the amount of coverage in your policy. For example, a new TV costs $1,000. Your insurance company would determine the amount of your settlement by subtracting from $1,000 an amount that reflects your usage.

Additional living expense coverage
The extra costs of living someplace else when your insured home is unlivable due to damage caused by a covered loss.

All-risk insurance
An all-risk policy pays for losses from damage to property when the cause of damage was direct, sudden and accidental and is not excluded from your policy. An "all-risk" policy covers all perils (causes of loss) that are not specifically listed as excluded within the policy. May also be referred to as "comprehensive" or "open peril."

Claim
An instance in which an insured seeks to recover payment under an insurance policy for a loss covered by that policy.

Claims Adjuster
Person who directly investigates a claim filed by the insured. The adjuster also assesses whether or not the loss is covered by the policy.

Coinsurance
Requires the customer to carry insurance equal to a specified percentage of the value of the property insured in order to receive full payment of a loss.

Comprehensive
Coverage that covers any direct, sudden and accidental physical damage losses except those excluded in the policy (See All-risk).

Coverage limit
The extent of protection against losses provided under the terms of an insurance policy. Also called "insurance" or "protection."

Debris removal
Covers the cost of hauling away materials or wreckage left by a covered peril. For example, this might pay for the cost to haul away roof sections, burnt walls and damaged furniture after a fire.

Deductible
Some policies are written to pay only after the policyholder has suffered an agreed amount of loss. The amount the policyholder must pay first is the deductible. It’s "deducted" from the total loss amount to determine how much the company must pay. Even though a policy has a deductible, there may be coverages within a policy that are not subject to that deductible.

Extended coverage
A group of perils that are either packaged or offered as an option with dwelling fire policies. These perils are: windstorm, hail, smoke, explosion, riot, riot attending a strike, civil commotion, vehicle and aircraft.

FAIR Plan
An insurance program made available to risks that are unable to secure coverage through regular channels because of various reasons (i.e., vacancy, high vandalism). Not available in all states.

Flexible payment plan
Allows you to pay your premium in 1, 2, 4 or 10 installments.

Foremost BASICS
The name for Foremost’s dwelling fire and home insurance program. It is designed to provide property and other related insurance coverages on residential dwelling properties with four or fewer apartments or living units. The buildings may be owner-occupied or rental.

Liability coverage
Covers losses that result when an individual causes accidental injury to another person or damage to their property. If you accidentally set fire to your neighbor’s garage while burning leaves in your yard, this is the type of coverage that would apply. Liability insurance often includes coverage for defense costs in a liability lawsuit.

Loss of rents coverage
If a loss covered by the policy damages the part of a dwelling that is rented to others, we will pay for the loss of normal rents resulting from that dwelling not being fit to live in or use. Sometimes referred to as "fair rental value."

Named peril coverage
Named peril policies specify the perils, or causes of damage, which are insured against as distinguished from "All-risk Insurance"

Open peril coverage
(also called "comprehensive coverage") – See All-risk

Other structures
In the BASICS policies, this coverage insures other structures you own on your premises which are separated from the dwelling or connected to your dwelling by only a fence, utility line or some other similar connection (See also Adjacent Structures Coverage).

Personal Property or Personal Effects
Things you own that you use to set up your rentals, such as refrigerators, stoves, or furniture. Personal property includes everything except land, buildings and any other structures attached to the land. Personal property may also be called "contents."

Repair cost
The cost to repair or replace property, without deduction for depreciation, using common construction materials and methods, locally available, which are equal in function and less costly.

Scheduled policy option
This option allows you to place all your rental properties on the same policy.