COMMONLY USED INSURANCE TERMS

What is "replacement cost"?

Replacement Cost is the amount necessary to replace or rebuild your home or repair damages with materials of similar kind and quality without deducting for depreciation.

What is "depreciation"?

Depreciation is the decrease in the home's value since the time it was built because of age or wear and tear.

What is "actual cash value"?

Actual Cash Value usually means the sum of money required at the time of the loss to repair or replace the property destroyed, less an amount for depreciation. Actual Cash Value equals the replacement cost less depreciation. Most standard home insurance policies cover the contents of your home (i.e., personal belongings) on an actual cash value basis, but it is possible to purchase replacement cost.

What is a "peril"?

A peril is a condition which can cause a loss. Three examples are fire, windstorm, and theft.

Warning - Phishing Scam

We are aware of a phishing scam targeting insurance professionals claiming that the National Association of Insurance Commissioners received a complaint that the professional submitted a falsified claim. This fraudulent email displays the NAIC and CIPR logos, can originate from what appears to be an naic.org or gmail.com email account, and instructs the recipient to click on a link to download the complaint notification.

Certain antivirus products will detect this as a malicious email.  If you receive a similar email and have any concerns, contact the NAIC Service Desk at (816) 783-8500 or [email protected].