Learn what these insurance terms really mean.
Dealing with your insurance is difficult enough without having to worry about confusing industry jargon. If you’re confused about some of the commonly used insurance terms, you’re not alone. Here are some definitions to help you make more sense of your insurance.
Your insurance deductible is the amount of money that you agree to pay when faced with an insured loss. For example, if your home’s roof is damaged during a hail storm and you have a deductible of $1,000, then you are responsible for paying this amount before your insurance coverage kicks in. Normally, the higher your deductible, the lower your premiums will be.
In the insurance world, an endorsement (also known as a policy rider), refers to a change or addition to an existing policy. An endorsement can be used to add, remove, or otherwise alter your coverage.
3) Personal Umbrella
This type of policy provides additional liability coverage that extends farther than the coverage limits offered by your standard policies. For instance, if your homeowners insurance offers liability coverage up to a certain dollar limit, then your personal umbrella coverage will kick in if you file a claim that exceeds the limits of your homeowners insurance.
This is the process where an insurance company examines your risk and determines whether they will accept your risk and insure you. During this process, an underwriter determines what the company will and will not cover and how far the coverage will extend.
Use these definitions to make sense of these commonly used insurance terms. Do you still have insurance questions? Then turn to the experts at Patterson & Associates in Richardson, Texas. Our team is ready to address all your coverage needs. Contact us to get started today.