Insurance words, made clearer.
A practical reference for reading an offer. These explanations do not replace the definitions in your own policy.
21 terms
Additional insured
A person or entity given specified insured status under a policy or endorsement. Check the scope and conditions rather than assuming it matches the named insured’s protection.
Aggregate limit
A cap that can apply to multiple covered claims during a defined period or category. Ask which claims share it and whether other limits also apply.
Binder
Evidence of an insurance arrangement pending formal documents, subject to its terms. A website enquiry or a request for a quote is not a binder.
Certificate of insurance
A document summarising specified insurance information. Review the policy and endorsements to establish the underlying protection.
Claims-made
A reporting basis that generally links protection to when a claim is made and any notification conditions. Review prior-work dates and reporting provisions.
Condition
A requirement in the contract, such as notification or protective measures. Ask what must be done and when.
Deductible
An amount the insured bears under the policy’s loss-sharing provisions. Different events or sections may use different deductibles.
Defence costs
Legal costs of responding to an allegation. Ask whether they are covered, need approval and reduce the policy limit.
Endorsement
A document that changes policy terms. Read it with the main wording and schedule.
Exclusion
Wording that removes or restricts specified events, activities or losses from protection. Extensions and exceptions may affect its application.
Indemnity period
A defined period relevant to certain interruption or benefit calculations. Check how it begins, ends and interacts with other conditions.
Named insured
The person or entity identified as insured in the contract. Check legal names and any additional insured definitions.
Occurrence basis
A basis that generally considers when a covered event occurred. The exact trigger and reporting obligations depend on the wording.
Premium
The price charged for the insurance arrangement. Compare the full term, fees, instalments and taxes where applicable.
Replacement cost
A settlement concept based on replacement or repair under specified conditions. Ask about valuation, depreciation treatment and any settlement restrictions.
Retention
An amount or responsibility retained by the insured before specified policy obligations apply. It may operate differently from a deductible.
Retroactive date
A date relevant to some claims-made arrangements that helps define eligible prior work. Other conditions and exclusions still matter.
Schedule
The policy information identifying insureds, dates, limits, property or other particulars. Read it with the wording and endorsements.
Sublimit
A smaller cap for a particular type of loss or expense within a policy. A headline limit may not apply to every category.
Territory and jurisdiction
Terms describing where activities or events may occur and where claims may be brought. They answer related but different questions.
Waiting period
A specified period before some protection or payment may begin. Check the starting event and the policy section to which it applies.
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Sources & further reading
General insurance principles and the jurisdiction-specific references below support further reading. Examples are illustrative; individual policy terms require provider confirmation. Content updated October 11, 2026.