The A-Zs of insurance jargon cleared up and defined

Generally, Jargon is one of the main reasons for frustration and misunderstanding in the insurance industry.

Jargon is one of the main reasons for frustration and misunderstanding in the insurance industry.

That’s why we created this guide, to eliminate all confusion surrounding key terms and slang often associated with insurance - making your life and the process of getting insurance a whole lot easier.


Accidental Damage
Often an optional addition, accidental damage will have your back for damages that might not be covered by your policy. Accidents such as a dropped phone, smashed tv, or spilt drink can be insured with accidental damage cover.

Act of God
An incident/event not under the control of man. Usually, this refers to storms, floods, and inclement weather that causes damage.

An addendum records and notes any changes to the original policy agreement.

Agreed value
If your insurer does not agree to a value (the agreed value) then your claim will be settled at
market value.

A change to anything in your policy agreement.

Optional extras.



Someone who is an intermediary between an insurer and the insured. They’ll sell a wide range of policies from several companies.Breakdown cover. If your vehicle (car/van/motorbike) breaks down then breakdown cover will help as you can call a roadside engineer who will be en route ASAP.

Buildings insurance
Usually compulsory before buying a property, buildings insurance covers the price of repairs to damage caused to the structure of a building.


An incident reported to the policymaker to which the insured requests payment.
- Non-fault claim - a full recovery for any losses related to a claim
- Fault claim - a claim that has not recovered all losses

Contents insurance
Coverage for household furnishings and possessions that require replacement or repair.

Cover note
A certificate that provides evidence of a person having an insurance policy.
Car cover typesThird-party - the minimum coverage required, covers you for damage to someone else’s car. If the incident is your fault you won’t be covered.
- Third-party theft & fire - covers your car for accidents, collisions and also replacing or repairing your car in the event of theft and fire.
- Comprehensive (full coverage) - protects your car from accidents and collisions as well as vandalism, or falling objects.




The loss of value of an item over time.



- See amendment above

Excess is the amount that you agree to pay to any claims that you make on your insurance.

Circumstances, events or hazards of loss that aren’t covered by your policy.



High-risk items
Items in your home that are more likely to be stolen in the event of a robbery.

High-risk occupations
For life and car insurance, occupations that are defined as high risk may lead to higher premiums and excess.

Home emergency cover
Covers the cost of call out fees and repair for home emergencies that put your health, security, or home at risk.
The cost of repairing actual damages to your property is not covered by home emergency insurance.



A device put into your vehicle that prevents the engine from starting unless the correct key is used.

The start of a policy may sometimes be referred to as the inception.

Indemnity insurance covers you for the potential future cost of a problem that is too expensive/time consuming or unfixable in the present.

Insurance Premium Tax
Tax charged by the government on all insurance policies.



Knock for knock
An agreement where both insurance companies agree to take losses.



Legal expense insurance
This insurance covers the cost of legal proceedings relating to situations such as unfair dismissal, discrimination, and accidental injury through no fault of your own.

- Adjuster - hired by an insurance company to determine whether you’re covered and to further investigate the cause of loss in what may be a complex claim.
- Assessor - has an interest in getting you the best settlement, as their final fee comes out as a percentage of it. They manage your claim on behalf of your insurance company.



Material facts
A fact that may influence the decision of an underwriter when deciding whether to accept risk and with what premium.

Mechanical breakdown insurance
Covers all of the problems that can occur with your car mechanically, often not covered by basic car insurance.

Modifications to cars will increase the cost of insurance.



New for old (replacement as new)
No matter the age or condition of the item you’re making a claim on, the price offered to you will be as new.

No claims bonus
The number of years that you are covered for without making claims can lead to a discount on the cost of your premium.



Personal possessions cover
Items often on your person that you determine to be important can be covered for damage, theft and loss.

Your actual contract signed with the insurance company, outlining the details of the agreement.

The individual or group whose name is on the insurance policy.

The amount of money you need to pay for a policy.



An estimate offered by an insurance company as to how much a new policy will cost.



Taking up the option to continue with the same policy.



A detailed outline of what is covered by an insurance policy.

The amount of money that you end up accepting for your claim.

Sum insured
The highest amount that an insurance company is willing to pay out on a claim.



Telematics (black box) insurance
Car insurance where the cost is determined by a black box that keeps note of how, when and where you drive.

A person not central to a case or claim, but plays a minor role.



Insurance that doesn’t fully cover the value of an asset.

Evaluate the overall risk of a policy on the insurance company’s side.



Valuable items
Precious items such as artwork, jewellery, watches, coins, stamps etc.



A guarantee from the manufacturer relating to the condition and smooth running of an asset.

If your car is no longer roadworthy, or not worth the cost of repair following an accident, your insurance company will take ownership of the  car and offer a payout that is equal to the value of your vehicle before the accident.

Embark on a Journey through Home Emergency Insurance: everything you need to Know for an in-depth exploration of the world of home emergency insurance and to gain valuable insights, be sure to visit our dedicated blog on this essential coverage. 


Everything you need to know about home emergency insurance, from its coverage benefits to claim procedures, to help you make informed decisions for covering your home emergencies.  

Explore the peace of mind and protection that come with Home Emergency Insurance in our informative blog on "Benefits of Home Emergency Insurance." We delve into the advantages this specialized coverage offers homeowners.