- Actual cash value
- The value of damaged property at the time of loss, usually calculated as replacement cost minus depreciation. Many policies pay this amount first.
- Additional living expense
- Coverage for the extra costs of living elsewhere, such as lodging and meals above normal, while a home is unlivable after a covered loss. Often part of Coverage D.
- Appraisal award
- The written decision that sets the amount of loss, signed by any two of the three panel members: the two appraisers and the umpire.
- Appraisal clause
- The policy provision that lets either side demand appraisal when they disagree on the amount of a covered loss.
- Appraisal demand
- A written notice from the policyholder or insurer invoking the appraisal clause and starting the process.
- Claim number
- The identifier an insurer assigns to a reported loss. It belongs on every letter, estimate, and invoice tied to the claim.
- Coverage A
- The dwelling coverage on a homeowners policy, which pays for damage to the house and attached structures.
- Coverage B
- Other structures coverage, for detached garages, sheds, fences, and similar buildings on the property.
- Coverage C
- Personal property coverage, for belongings such as furniture, clothing, and electronics.
- Coverage D
- Loss of use coverage, which typically pays additional living expense or lost rental income after a covered loss.
- Declarations page
- The summary page of a policy listing the insured, property, coverages, limits, deductibles, and policy period.
- Deductible
- The portion of a covered loss the policyholder pays before the insurer pays. It may be a flat amount or a percentage.
- Depreciation
- The reduction in value for age, wear, and condition. Insurers subtract it to reach actual cash value.
- Derecho
- A long-lived, widespread windstorm produced by a line of fast-moving thunderstorms, capable of damage across many counties.
- Disinterested appraiser
- An appraiser with no financial or personal stake in the outcome beyond a reasonable fee, as most appraisal clauses require.
- Drip edge
- Metal flashing installed along roof eaves and rakes to direct water into gutters and away from the fascia and decking.
- Estimate
- An itemized statement of the work and materials needed to repair a loss, with quantities and prices for each line.
- Exclusion
- A policy provision that removes certain causes of loss or types of property from coverage, such as flood on a standard homeowners policy.
- Hail strike
- A point of impact from a hailstone, often seen as a bruise, fracture, or loss of granules on shingles or a dent in metal.
- Ice and water shield
- A self-adhering waterproof membrane installed under shingles at eaves, valleys, and penetrations to resist ice dams and wind-driven rain.
- Ice dam
- A ridge of ice that forms at a roof edge when melting snow refreezes, backing water up under shingles and into the home.
- Line item
- A single entry in an estimate describing one task or material, with a quantity, unit, and price.
- Matching
- The question of whether undamaged materials must be replaced so repairs reasonably match the rest of the surface in color, texture, or style.
- Mitigation
- Reasonable steps taken after a loss to prevent further damage, such as tarping a roof or drying out a wet basement.
- NFIP
- The National Flood Insurance Program, the federal program that writes most flood insurance policies in the United States.
- Ordinance or law coverage
- Coverage for added costs to bring repaired or rebuilt property up to current building codes.
- Overhead and profit
- A general contractor’s charges for business overhead and profit, often 10% each in estimates, when a loss requires coordination of multiple trades.
- Percentage deductible
- A deductible calculated as a percentage of the dwelling limit rather than a flat dollar amount, common for wind and hail on some policies.
- Pitch
- The steepness of a roof, expressed as rise over 12 inches of run. Steeper roofs usually cost more to repair.
- Proof of loss
- A sworn statement of the amount claimed, which some policies require within a set time after the insurer asks for it.
- Recoverable depreciation
- Depreciation withheld from an initial payment that the insurer pays later, usually once repairs are completed under a replacement cost policy.
- Replacement cost value
- The cost to repair or replace damaged property with materials of like kind and quality, without subtracting depreciation.
- Reservation of rights
- A letter in which the insurer continues handling a claim while reserving the right to deny coverage later.
- Scope of loss
- The description of all damage and the work needed to repair it. Many disputes come down to differences in scope.
- Snow load
- The weight of accumulated snow and ice on a roof. Heavy loads can crack trusses or collapse structures.
- Square (roofing)
- A unit of roofing measure equal to 100 square feet of roof surface.
- Subrogation
- The insurer’s right, after paying a claim, to recover its payment from a third party who caused the loss.
- Suit limitation
- A policy provision, together with state law, that limits how long a policyholder has to file a lawsuit over a claim.
- Supplement
- A request for additional payment for damage or costs found after the original estimate, often during repairs.
- Surplus lines
- Insurance written by carriers not licensed as standard insurers in the state, often used for hard-to-place risks.
- Tear-off
- Removal of existing roofing layers down to the decking before new roofing is installed.
- Umpire
- The neutral third member of an appraisal panel who decides items the two appraisers cannot agree on.
- Waste factor
- An added percentage of material in an estimate to account for cutting and fitting, especially for roofing and siding.
- Xactimate
- A widely used estimating software program that insurers and contractors use to price repairs with regional unit costs.
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