Personal and business vocabulary, defined the way an honest agent would explain it over coffee. Filter by category, search by keyword, bookmark anything useful.
What your stuff is worth right now — replacement cost minus depreciation. If your 2018 sedan is totaled, ACV is what the carrier estimates the car was worth the day before the accident, not what it would cost to buy a new one.
A person or entity added to your policy who gets the same coverage you do for the work you're doing. General contractors routinely require subs to add them as additional insureds. Property owners require tenants to add them. The most-misunderstood concept in commercial insurance — adding someone as additional insured is not the same as paying their premium, and it doesn't reduce your coverage. It's just a paperwork acknowledgment that says "if there's a claim from our work together, this person is also covered." See also: our sample COI walkthrough.
Two numbers on every commercial liability policy. Per-occurrence is the maximum the carrier will pay for any single claim. Aggregate is the maximum they'll pay across all claims during the policy period. A 1M/2M GL policy means $1M per claim, $2M total for the year. After the aggregate is exhausted, you have no coverage for the rest of the policy period — even if the per-occurrence limit hasn't been hit. Most carriers will let you increase the aggregate; it's worth asking.
A captive agent works for one insurance company and sells only that company's products. An independent agent works with multiple carriers and shops your policy across them. Both can be excellent. The difference matters when one carrier raises your rate — a captive agent has nowhere else to send you.
A state where the driver who caused the accident (and their insurance) is responsible for the resulting damages. Texas is an at-fault state. The opposite is "no-fault," where each driver's own insurance pays for their injuries regardless of who caused the crash.
The coverage that pays for injuries to other people when you cause an accident. Almost always written as two numbers — for example, 100/300 — meaning $100,000 maximum per injured person and $300,000 maximum across everyone hurt in that accident. This is the single most important number on your auto policy.
A package policy that bundles commercial property and general liability into one — usually at a meaningful discount versus buying them separately. Designed for small to mid-sized businesses operating from a fixed location: retail, office, light service. Usually includes business interruption coverage as well. For trades, contractors, and businesses with mobile equipment, a BOP often isn't enough on its own — you'll likely need an inland marine endorsement or a separate commercial policy structure.
Buying your home and auto policies (and sometimes others) from the same carrier in exchange for a discount. Discounts of 15–25% are typical. Bundling is often a great deal — but not always. Sometimes one of the two policies is overpriced and the discount is a smokescreen.
Coverage that replaces lost income when a covered event (fire, storm, etc.) shuts your operation down. Pays ongoing expenses like rent, payroll, and utilities while you can't operate. Usually included in a BOP, but the limit and the time period (typically 12 months) are worth scrutinizing — minimum-limit business interruption evaporates fast in a real shutdown.
A one-page document that summarizes your active business insurance — carriers, policy numbers, coverage types, limits, and effective dates. Required constantly: by general contractors, property owners, vendors, clients, anyone you do work for. Important to know: a COI is informational, not contractual. It doesn't expand your coverage and the carrier isn't bound by what's typed on it. The actual policy controls. See our sample COI walkthrough for a line-by-line breakdown.
A request you make to your insurance company to pay for a covered loss. Filing a claim is what you bought the policy for — but it can also affect your rates at renewal, depending on the type and severity. Not every fender-bender needs to become a claim.
How carriers categorize your business for rating purposes. Each class code corresponds to a type of work and an associated rate per $100 of payroll (workers' comp) or revenue (GL). Your class codes affect your premium dramatically — a roofing class is rated very differently than an interior carpentry class. Misclassification, intentional or not, gets caught at audit time and can result in a big premium correction.
Pays to fix or replace your car when it's damaged in a crash — regardless of who caused it. Required if you have a loan on the car. Optional if you own it outright. Comes with a deductible.
Auto insurance built for vehicles used in business — work trucks, fleet vehicles, vehicles titled to an LLC, vehicles used to haul tools or transport goods. Personal auto policies have business-use exclusions that quietly bite when a vehicle is used primarily for work. Higher liability limits, broader coverage for hired and non-owned vehicles, and tools/equipment endorsements that don't exist on personal policies.
Coverage for claims that arise from your work after you've finished it. The deck you built last year collapses. The wiring you ran six months ago starts a fire. The product you sold last quarter injures a customer. GL policies have separate aggregate limits for "ongoing operations" (work in progress) and "completed operations" — both matter, and both should be adequately funded. For trades and product-makers, completed operations is the bucket where most catastrophic claims actually live.
Pays to fix or replace your car for damage not caused by a crash — hail, theft, fire, vandalism, a deer, a flood, a tree branch. Like collision, it has a deductible. Often called "other than collision" on a declarations page.
Coverage for the costs of a data breach, ransomware, or other cyber event. Includes things like forensic investigation, customer notification, credit monitoring, ransom payments, business interruption from system downtime, and regulatory fines. Increasingly required by clients and lenders. Even small businesses with no obvious "tech" footprint often handle enough customer data — emails, payment info, employee records — to need this.
The cover sheet of your policy. Lists who's insured, what's insured, the limits, the deductibles, the premium, and the policy period. If you only ever look at one document, this is it. We have a whole walkthrough on how to read it.
The amount you pay out of pocket before your insurance kicks in on a covered claim. Higher deductibles lower your premium. Lower deductibles mean less cash up front when something goes wrong. The right number usually depends on whether you have an emergency fund.
The part of a homeowners policy that pays to rebuild your house if it's destroyed. The number should reflect the cost to rebuild, not the market value or the purchase price. Construction costs have climbed sharply — many policies are quietly underinsured here.
An add-on to your existing policy that changes the coverage somehow — adds a scheduled item like jewelry, raises a sublimit, includes a teen driver, adds rideshare coverage. Sometimes called a "rider." Endorsements are how a standard policy becomes tailored to your situation. The most commonly missed personal one in 2026: the rideshare endorsement, which closes the coverage gap for drivers using Uber, Lyft, DoorDash, and similar apps.
Coverage for claims arising from professional advice or services — for consultants, accountants, designers, IT professionals, real estate agents, and anyone whose work product can cause financial harm if it's wrong. General Liability covers physical injury and property damage; E&O covers the rest. If you advise clients, handle their money, or produce work product they rely on, you probably need it.
Something the policy specifically does not cover. Every policy has them. Common auto exclusions: intentional damage, racing, using your personal car for delivery work. Common home exclusions: floods, earthquakes, mold above a certain amount. Common commercial exclusions: pollution, asbestos, certain professional services. The exclusions list is where surprises live.
If you total a financed car, your insurance pays the actual cash value — but you might still owe more on the loan than the car was worth. Gap coverage pays that difference. Mostly relevant for new-car buyers and long-term loans.
The foundation of small business insurance. Covers third-party bodily injury, property damage, and personal/advertising injury arising from your operations, your premises, or your completed work. The "slip-and-fall, spilled-coffee, hit-the-wrong-pipe" coverage. Most contracts a small business signs require some level of GL — typically $1M per occurrence / $2M aggregate at minimum.
Liability coverage for vehicles your business uses but doesn't own — rental cars, employees driving their own personal vehicles for work errands. Without HNOA, when an employee runs to Home Depot in their own car for the job and rear-ends someone, the business has no coverage and the employee's personal auto policy may deny because they were on the clock. One of the most-missed coverages in small business — usually inexpensive to add.
A Texas legal protection that prevents your primary residence from being seized to pay most civil judgments — including those from at-fault auto accidents. One of the strongest in the country. It's why Texas is generally safer for homeowners than the personal-liability headlines suggest, but it's also why second properties and business assets need separate planning.
Despite the name, has nothing to do with boats. Originally designed for cargo moving over land (away from ocean marine cargo). Today, it covers business property that moves — tools, equipment, contractor materials, leased equipment. If you're a trades business with $40K of tools that travel between job sites, inland marine is what insures them. A standard BOP usually doesn't cover property away from your fixed location adequately; inland marine fills that gap.
The part of your policy that pays for damage you cause to other people or their property. The opposite of collision/comprehensive (or commercial property), which pays for your own stuff. Liability is the foundation of any policy — and the place where most people are quietly underinsured.
The bank or credit union that owns part of your car or home until the loan is paid off. Lienholders are listed on your declarations page and have to be notified about coverage changes. They're also why you can't drop collision and comprehensive on a financed vehicle.
The clause in nearly every personal auto policy that says coverage doesn't apply when the vehicle is being used "for hire" or "for compensation" — which includes driving for Uber, Lyft, DoorDash, Instacart, Amazon Flex, and similar platforms. The exclusion kicks in the moment you log into the app, not just when you have a passenger or order. The fix is usually a rideshare endorsement on your personal policy.
A report from your current carrier showing your claim history — date, type, amount paid, status. Required at every commercial renewal and any time you shop for a new carrier. Carriers can't underwrite you without it. Loss runs typically cover the past 3–5 years. If you've had a clean record, your loss run is your single best negotiating asset; if you've had claims, it's the document that explains them.
Optional auto coverage that pays small medical bills for you and your passengers after a crash, regardless of fault. Usually $1,000–$10,000. Cheap to add. Often overlooked.
The person or entity the policy is written for. On personal policies, spouses are usually both named; kids who drive may or may not be. On commercial policies, the named insured is typically the business entity (the LLC or corporation), and individual owners may be added separately. Coverage often extends to other people connected to the named insured (employees, household members, permissive users), but the details matter.
Texas is the only state where workers' compensation is technically optional. A "non-subscriber" is an employer who has chosen not to carry workers' comp. The trade-off: non-subscribers are exposed to direct lawsuits from injured employees with no liability cap, and they lose the legal protections workers' comp provides. Most carriers won't offer GL or commercial auto without workers' comp in place. In practice, going non-subscriber is a riskier and usually more expensive path than just carrying the coverage.
Coverage for claims arising from work you're currently doing — as opposed to completed operations, which is for finished work. While you're on the job site, while the project is in progress, while you're actively performing the service. GL policies treat ongoing and completed operations as separate buckets with separate aggregate limits. For most contractors, ongoing operations claims are more frequent (a tool dropped on a customer's car) but completed operations claims tend to be larger (the deck you built last year collapses). Both buckets need adequate funding.
Coverage that pays for medical bills, lost wages, and certain other costs for you and your passengers regardless of who caused the crash. Texas requires carriers to offer at least $2,500 of PIP, but you can decline it in writing. Most people don't realize they have it — or don't.
The window of time the policy covers — usually six months for auto, twelve months for home and most commercial lines. Listed on the declarations page. Things that happen before or after the policy period aren't covered.
The annual end-of-policy true-up on commercial policies — most often workers' comp and GL. Premiums are estimated up front based on your projected payroll or revenue. After the policy period ends, the carrier audits your actual numbers and either bills you for the difference or refunds you. The classic surprise: a contractor underestimates payroll, has a great year, and gets a brutal audit bill they didn't budget for. Keep good records and update your projection if your business grows mid-policy.
What you pay for the policy. Usually quoted monthly, every six months, or annually. Lower premiums often mean lower limits, higher deductibles, or fewer coverages — not always, but often.
The part of your auto policy that pays to repair or replace things you damage when you cause a crash — other cars, fences, mailboxes, store fronts, lampposts. Texas minimum is $25,000. The average new car costs almost twice that. Worth a look.
What it would cost to buy a brand-new equivalent of what you lost — without subtracting for depreciation. The opposite of actual cash value. Available as a coverage upgrade on home contents and roof. Almost always worth the small price difference.
A Texas legal rule that says if a victim's attorney offers to settle within your policy limits and your insurance company unreasonably refuses, the carrier — not you — becomes responsible for the full judgment, even above your limits. Important for high-stakes claims and one of the reasons your insurance company has incentive to settle reasonably.
The IRS, the workers' comp carrier, and the courts all have different definitions, and getting this wrong is one of the most expensive mistakes a small business can make. For workers' comp: if a sub doesn't carry their own workers' comp, your policy will likely cover them and your premium will be billed accordingly at audit. For tax purposes: misclassifying employees as 1099 contractors creates IRS liability and back taxes. For liability: a sub's negligence on your job can become your problem if proper indemnification and additional-insured language isn't in place. Always require COIs from subs.
The process where your insurance company, after paying your claim, goes after whoever actually caused the loss to recover the money. You usually never see it happen — but if successful, you may get your deductible refunded. See also: Waiver of Subrogation.
A separate policy that adds another layer of liability coverage — typically $1 million to $5 million — on top of your underlying policies. Personal umbrella sits over your auto and home liability. Commercial umbrella sits over your GL, commercial auto, and employer's liability. Kicks in only after the underlying limits are exhausted. Often costs $200–$500 a year for $1M of personal coverage; commercial umbrellas vary by industry but are usually surprisingly affordable. The most underused product in both personal and commercial insurance.
Pays your medical bills, lost wages, and pain and suffering when somebody else hits you and either has no insurance or doesn't have enough. Texas requires carriers to offer it; you can reject it in writing. One important rule: UM/UIM limits cannot exceed your bodily injury liability limits — so if you want more UM/UIM, you have to raise your liability first. Best practice is to match the two.
The process the insurance company uses to decide whether to insure you and at what price. Considers your history, claims, location, and many other factors. Different carriers underwrite differently — which is why the same person or business can get wildly different quotes from different companies.
A clause — usually requested in commercial contracts and shown on your COI — where you (and your insurance carrier) give up the right to sue the other party to recover money your carrier paid out, even if that party caused the loss. General contractors routinely require subs to include a waiver of subrogation in favor of the GC. What you're agreeing to: if your equipment is damaged on the GC's site through their negligence, your insurance pays your claim and then cannot go after the GC to recover. The GC walks away clean. It's not catastrophic, but it's a real concession — and most contractors sign these without reading them. Adding waiver of subrogation to your policy usually requires an endorsement and may slightly raise your premium.
Coverage that pays for medical bills and lost wages when an employee is hurt on the job — and in exchange, generally protects the business from being sued by that employee. In most states, required by law for any business with employees. Texas is the exception: it's the only state where workers' comp is technically optional (see "Non-Subscriber"). For practical purposes, most Texas businesses with employees still carry it because going without exposes you to direct lawsuits with no liability cap.
No matches. Try a shorter word, or one of these: · · ·