Insurance Glossary*

Agreed Value*

A predetermined amount  nominated by the party insured as the value of the insured item, used in case of a claim.

Australian Financial Complaints Authority (AFCA)*

An independent authority that handles complaints about financial products and services, including insurance, in Australia.

Australian Financial Services Licensee (AFSL)*

An entity or individual licensed by ASIC to provide financial services, including advice and dealing in insurance products.

Authorised Representative (AR)*

An individual or company authorised to provide financial services on behalf of an Australian Financial Services Licensee (AFSL).

Broad Form Liability*

A liability policy that may provide wider coverage for personal injury and property damage claims, including premises, products, and operations liability.

Brokers Insurance Code of Practice*

A code that sets standards for insurance brokers in Australia, ensuring professionalism and quality service.

Business Insurance*

A form of coverage designed to protect businesses against risks such as property damage, legal liability, and employee-related risks. Coverage may vary based on the type of business and its operations.

Business Interruption Insurance*

A policy that may help compensate for lost profits and assist covering ongoing, fixed costs if a business is forced to close temporarily due to an insured event like fire or theft .

Business Pack Insurance*

A bundled insurance package that may offer a variety of coverage options, such as property, liability, and business interruption, tailored to a business’s needs.

Certificate of Currency (COC)*

A document issued by an insurer to confirm that an insurance policy is active and provides coverage.

Claim*

A request made by the insured to the insurer for payment under the terms of the policy following an insured incident or event.

Claims History*

A record of the claims made by an insured under their insurance policies.

Claims Made Policy*

A type of policy where claims are covered only if made during the active policy period, regardless of when the event occurred.

Claims Occurrence Policy*

A type of policy that covers claims for incidents that occur during the policy period, regardless of when the claim is made.

Commercial Insurance*

A broad category of insurance designed to protect businesses and organisations from various risks, including property, liability, and employee-related risks. 

Commercial Landlord Insurance*

Coverage for landlords of commercial properties, protecting against property damage and loss of rental income.

Commercial Tenants Insurance*

Insurance for tenants of commercial properties, which may cover liability, property, and other business-specific risks.

Commercial Vehicle Insurance*

Insurance tailored to vehicles used for business purposes, covering risks such as damage, theft, or third-party liability.

Contract Works Insurance*

Coverage for construction projects, including damage to the works in progress and third-party liability during construction.

Cyber Liability Insurance*

Coverage that may protect businesses from risks associated with data breaches, cyber-attacks, and other digital threats.

Duty of Disclosure*

The legal obligation of the insured to provide accurate and complete information to the insurer when taking out, renewing, varying, or reinstating an insurance contract.

Errors and Omissions Insurance*

Also known as professional indemnity insurance, this coverage may protect professionals from claims of negligence, errors, or omissions in their work.

Excess Layer*

An additional layer of insurance coverage that kicks in when the primary coverage limit is exhausted.

Equipment Breakdown Insurance*

Insurance that may cover the costs of repairing or replacing machinery and equipment following a sudden and unforeseen breakdown.

Fire and Perils Insurance*

Insurance that may cover damage to property caused by fire and other specified  events such as storm, impact damage or earthquakes.

Financial Services Guide (FSG)*

A document provided by financial service providers outlining their services, fees, and complaints process.

General Advice*

Advice that does not take into account the personal needs or circumstances of the client.

Indemnity Period*

The duration for which insurance benefits are payable following an insured event, such as in business interruption insurance.

Industrial Special Risks Insurance (ISR)*

Comprehensive coverage for larger businesses, protecting against a broad range of risks to property and business operations.

Insurable Interest*

A legal or financial interest in the subject matter of insurance, such that the policyholder would suffer a loss if the insured event occurs.

Insured*

The person or entity covered by the insurance policy.

Insured Event*

An event covered under the terms of the insurance policy.

Insurer*

The company providing the insurance policy and assuming the risks outlined within it.

Insurance Agent*

An individual or entity authorised to sell insurance policies on behalf of an insurer.

Insurance Broker*

An independent professional who represents clients in finding and arranging suitable insurance coverage.

Insurance Company*

A company that provides insurance policies and assumes the risks outlined in those policies.

Insurance Premium*

The amount paid by the insured to the insurer for coverage under a policy.

Insurance Quote*

An estimate provided by an insurer of the cost of a proposed insurance policy.

IT & T Insurance*

Insurance that may cover risks specific to information technology and telecommunications businesses.

Jurisdiction*

The legal authority under which an insurance policy operates and disputes are resolved.

Key Person Insurance*

A policy that may provide financial support to a business in the event of the death or disability of a critical team member.

Legal Expenses Insurance*

A policy that may assist with legal costs arising from disputes or claims involving the business.

Loss Adjuster*

A professional appointed by the insurer to assess and settle claims made under a policy.

Loss Ratio*

The ratio of claims paid to the premiums received by an insurer, indicating the profitability of an insurance portfolio.

Management Liability Insurance*

Coverage that may protect a business’s directors, officers, and managers against claims of wrongful acts in their management duties.

Market Value*

The current value of an asset in the marketplace, often used in determining insurance payouts.

Non-Disclosure*

Failure to provide relevant information to an insurer, which may impact the validity of a policy or claim.

Over Insurance*

A situation where the sum insured exceeds the actual value of the insured property or risk.

Pay by the Month Insurance*

An option allowing policyholders to spread their premium payments across monthly instalments.

Personal Accident and Sickness Insurance*

Coverage that may provide benefits for income loss or medical expenses due to personal injury or illness.

Personal Advice*

Advice tailored to the specific needs and circumstances of the client.

Policy Aggregate*

The maximum limit of coverage an insurer will pay out during the entire policy period.

Policy Cancellation*

The termination of an insurance policy before its expiry date by the insurer or the insured.

Policy Deductible*

The amount the insured must pay out of pocket before the insurer covers the remaining costs of a claim.

Policy Endorsement*

An amendment or change to the terms of an existing insurance policy.

Policy Excess*

The portion of a claim that the insured must bear, similar to a deductible.

Policy Extension*

A modification to extend the coverage period of an insurance policy.

Policy Expiry*

The date on which an insurance policy’s coverage ends.

Policy Inception*

The date on which an insurance policy’s coverage begins.

Policy Lapsed*

A policy that has expired or been terminated due to non-payment of premiums or other reasons.

Policy Limit*

The maximum amount an insurer will pay under a policy for a single claim or for all claims within a policy period.

Precedent Condition*

A requirement or condition that must be met before a claim can be considered under a policy.

Product Disclosure Statement (PDS)*

A document that outlines the features, benefits, inclusions and exclusions of an insurance policy.

Product Liability Insurance*

Insurance that may cover a business for claims of injury or damage caused by products it has manufactured, sold, or supplied.

Professional Indemnity Insurance*

This coverage may protect professionals from claims of negligence, errors, or omissions in their work.

Professional Negligence*

Failure to exercise reasonable skill or care in the performance of professional duties, which may lead to liability claims.

Proximate Cause*

The direct cause of a loss, which determines whether the insurer will cover a claim.

Public and Products Liability Insurance*

A combined policy that may protect against claims of injury or property damage caused by the business’s operations or products.

Public Liability Insurance*

A policy that may cover businesses for claims made by third parties who suffer injury or property damage due to the business’s activities or presence.

Reinsurance*

The practice of insurers transferring part of their risk portfolios to other insurers to manage financial exposure.

Retail Client*

A client who is not a business or wholesale client, often receiving consumer-focused insurance services.

Risk Mitigation*

The process of reducing potential risks through preventative measures or controls.

Run Off Cover*

Insurance that may provide coverage for claims made after a business or professional practice has ceased operations.

Self Insurance*

A risk management strategy where a business retains and manages risks internally rather than transferring them to an insurer.

Steadfast*

A network of independent insurance brokers in Australia, providing access to a wide range of products and services.

Strata Insurance*

Insurance designed for properties managed under a strata scheme, covering common areas and shared property.

Subrogation*

The process by which an insurer assumes the rights of the insured to recover costs from a third party responsible for a loss.

Sum Insured*

The maximum value of a claimable amount under a policy for a specified item or event.

Target Market Determination (TMD)*

A document outlining the intended target market for an insurance product, ensuring it meets the needs of its audience.

Third Party Liability Insurance*

Coverage for claims made by third parties for injury or damage caused by the insured’s actions or property.

Total Loss*

A situation where the cost of repairing damaged property exceeds its market or agreed value, also referred to as a write off.

Transit Insurance*

Coverage that may protect goods being transported from loss or damage during transit.

Under Insurance*

A situation where the sum insured is less than the actual value of the property or risk being covered.

Underwriter*

A professional who assesses risks and determines the terms and premiums for insurance policies.

United Insurance Group*

A member network of insurance brokers providing access to resources, training, and collective expertise.

Utmost Good Faith*

A principle requiring both the insurer and the insured to act honestly and disclose all relevant information when entering an insurance contract.

Wholesale Client*

A business or individual with insurance needs exceeding those of a retail client, often requiring tailored or complex coverage.