Defining Insurance Jargon January 21, 2021 Insurance has your back by ensuring your assets are covered, but insurance jargon can often get in the way of you clearly understanding your policy. To help make sense of your insurance policy, here are 10 common insurance terms that could help when both reviewing policies or speaking with your agent. Line(s) of Insurance: A class of type of insurance e.g. home insurance, auto insurance, commercial insurance, etc. Example: Charles has two lines of insurance with OKFB: Auto Insurance and Farm & Ranch Insurance. Deductible: A specified amount of money that a policyholder must pay before an insurance company will pay a claim. Example: Esther has to pay a deductible of $300. After she pays her deductible, OKFB will pay the remainder of the claim that is stated in her policy. Claim: A request or demand for payment from an insurance carrier, as defined in the policy. Example: Carl and Robert filed a claim after a tornado impacted their car and farm. See how Billy and the rest of our team immediately worked to fulfill it here. Coverage: The extent an item or property is insured in the event of an accident. Example: Daniel got a full coverage auto insurance policy with OKFB, so he is covered in the event that he is in an accident. Umbrella Coverage: Provides higher limits of protection against bodily injury or property damage claims by a third party. Example: After careful consideration, Anthony decided that umbrella coverage would offer greater protection and peace of mind. Risk: The chances a loss could potentially occur. Example: Christie carefully explained the risks associated with lower coverage insurance policies, so I opted for more coverage. Policy: The contract between a policyholder and insurance carrier. Example: Lauren has an auto insurance policy with OKFB Insurance, so OKFB insures her vehicle in the case of an accident. Premium: Cost an insurer sets for the coverage listed in an insurance policy. Example: Marco’s premium for his homeowner insurance is $1,200, so he pays $100 every month. Quote: An estimate of premium for a specific line of insurance/policy. Example: Ashley just bought a new home and was looking for the best coverage on Home Insurance, so she used OKFB’s Instant Homeowners Quote to find OKFB’s prices. Dwelling: A place of residence, e.g. a home, mobile home, etc. Example: After talking to my agent, I got Dwelling Fire Insurance on my vacation home in Broken Bow. Check out our glossary for more common insurance terms. If you have any questions or want further clarification about an insurance term contact your OKFB agent. Also, don’t forget to check in regularly with your agent to ensure your coverage is up to date. We’re here to help you through the unexpected.
