Busting the insurance jargon

2 MIN READ February 4, 2019
Whether or not you have insurance policies in place, it’s likely you’ve heard of at least one of these terms. We’ve put together the most common words that you’ll come across in insurance and explained what they mean to hopefully clear up any confusion!

If you want to chat further about any of these terms,or insurance in general, get in touch with our fantastic team today!

Agreed Value
The amount for which you and your insurer agree to insure your motor vehicle. Agreed value policies are usually more expensive than market value policies because it doesn’t take into account any adjustment for depreciation or appreciation.

An assessor is someone who acts for the insurer, checking the details of the claim to see if it’s valid and meets the conditions of your policy.

A claim is the request you make for compensation from your insurer if you suffer a loss that is covered by your insurance policy.

These are personal tangible items, for example, things like bicycles, furniture, computers, equipment, jewellery, business tools, carpets, curtains.

Duty of disclosure
When you set up an insurance policy, you have a duty to tell the insurer everything about your situation that is relevant to the insurer and their decision to cover you.

This is the amount of any claim that you have to pay yourself. If your excess is $250, you would need to pay $250 of any claim and the insurer pays the rest.

No Claims Bonus
A no claims bonus is a discount or reduction in your insurance premium that can be allowed if you haven’t made any claims in a certain length of time, usually one or more consecutive years.

This is when a person has not told their insurer all of the information that should have been given as part of the Duty of Disclosure at the policy application stage.

A document issued to you from an insurer that sets out the terms and conditions of the insurance contract.

The amount of money you pay to your insurance company for your policy, in return for the insurance company’s promise to cover you if something that is covered by your policy, goes wrong.

Sum Insured
The sum insured is the maximum amount that your insurer will pay for a claim in a particular policy. Eg. as house might be insured for the sum of $400,000.

The process an insurer goes through to evaluate, accept or reject an insurance risk. This enables the insurer to calculate the premiums it will need to charge to insure that risk.


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