following Insurance and Financial terms are for guidance only and jml Property
Services does not take any responsibility for their content or accuracy. Information
on many of these insurance industry terms have been provided by HomeLet
- Landlords and Tenants Insurance
INSURANCE - Coverage for more than one type of property at one location
or one type of property at more than one location.
GOODS - Used commonly as a generic term to describe
electronic goods such radios, televisions and computers etc (see also White Goods
at bottom of these terms)
Certificate of Motor Insurance which provides evidence that You have
taken out insurance as required by law.
- Is a clause in or in addition to the policy document, which places
on the insured party an obligation. Failure to carry out this obligation could
make the contract unenforceable. For example, theft cover may be a conditional
on multiple tenanted properties having a separate lockable entrance for each tenanted
property. Should it be found that one or more of the properties does not have
a separate lockable entrance, in the event of a claim for theft, the insurer could
refuse the claim.
- The act of seeking redress from another
- Anyone who is making a claim. Specifically in this context, the
insured person claiming on their insurance policy or someone claiming against
INSURANCE - A term which distinguishes 'short term' insurance, such as
property insurance or motor insurance, from 'long term' insurance, such as life
assurance or pension assurance. The former is normally arranged on a renewable
annual contract whereas the latter is a non-renewable contract which remains in
force until the assured event occurs or the contract is cancelled or 'surrendered'
LIABILITY INSURANCE - Insurance for emplyers in respect of their liabilty
to employees for injury or disease arising out of and in the course of their employment.
With some exemptions this insurance is complulsory in Great Britain and can only
be provided by an authorised insurer.Insurance for emplyers in respect of their
liabilty to employees for injury or disease arising out of and in the course of
their employment. With some exemptions this insurance is complulsory in Great
Britain and can only be provided by an authorised insurer.
- A written form attached to an insurance policy that alters the policy's
coverage, terms, or conditions
- A provision in an insurance policy that eliminates coverage for certain
risks, people, property classes, or locations
-The first portion of a loss or claim which is borne by the insured.
On some policies, an excess can be voluntary to obtain a premium reduction.You
are responsible for the Excess even if the incident is not Your fault. The sum
of money that you must pay towards the eventual cost of your claim. Strictly this
is due at the beginning of the claim but is most often deducted at the end. The
amounts involved vary from insurer to insurer and from section to section of your
policy depending on your personal circumstances. It is important to check your
policy in this regard.
/ EXCLUSIONS (above) - The insurer may want to exclude certain things
or events relating to the insured peril. For example, damage to a property that
has been unoccupied for more than x days. These are called 'exceptions' or 'exclusions'
and will be brought to your attention in the policy document. N.B. No policy covers
everything that might possibly happen. Only the perils written in the policy are
covered and nothing else.
INTEREST -The legally recognised relationship between the insured and
the financial loss the insured suffers in the event of an insured event happening.
You can therefore only insure something in your own name if you were to suffer
financially in the event of an insured incident occurring.
PREMIUM -The periodic payment made on an insurance policy, called a premium.
RIGHT OF SUBROGATION - In certain circumstances, someone who suffers
loss or damage as the result of another's actions may have a right of recovery
from some other source. It is not lawful to recover and retain the same amount
from more than one source. For example, an insured person cannot recover and retain
his/her losses from both an insurance policy and from any other party who may
be liable. However, an insurer who has accepted and paid the insured party's claim
has the right to recover their loss from the third party direct. This is called
the insurers right of subrogation.
/ INDEMNIFY - A principle whereby the insurer seeks to
place the insured in the same position after a loss as he occupied immediately
before the loss (as far as possible). Insofar as insurance practice is concerned,
indemnity has been described as "Placing the claimant into the same financial
position after the insured event as he enjoyed immediately before the event".
In respect of property insurance for instance, this means meeting the cost of
repairing an item, or of replacing it, or by paying a sum equal to the value of
the damaged item. Check the policy wording in all cases.
OF INDEMNITY - The maximum amount that will be paid under the terms
of the policy per claim, per series of claims or for a fixed period of time.
The liquidity of an investment refers to its accessibility and how easily
it can be turned into cash. Some assets owned by banks cannot be turned into cash
very easily, but are instead vauluable over time. These assets are said to have
a low liquidity due to their inaccessiblilty in times of urgency, when money is
FACT - Any fact which would influence the insurer in accepting or declining
a risk or in fixing the premium or terms and conditions of the contract is material
and must be disclosed by a proposer, or by the insurer to the insured
- The act of bringing an industry or assets like land and property
under state control.
- In its broadest sense, carelessness. The failure by a reasonable person
to use sufficient care, diligence and skill which is required for the protection
of others from injury or damage.
- A failure to disclose a material fact to the underwriter. Non-disclosure
entitles the underwriter to summarily void (make unenforceable) the contract.
- Any event that could cause loss or create a liability to the insured, e.g. fire,
storm, negligence, etc.
OF INSURANCE - (Insurance Policy) Together with the Schedule of Insurance
the policy document (Policy of Insurance) is the written evidence of a contract
of insurance. It is not, of itself, the contract between the parties. The contract
exists and is legally enforceable from the moment the insurer agrees to provide
the insurance and the insured party pays the premium. Nevertheless, in the event
of a dispute between the insured party and the insurer, the policy document, along
with the Schedule of Insurance, will be assumed to represent the agreement reached
by both parties.
- The sum of money charged in return for providing the insurance. A proportion
of all premiums collected are placed into special funds called underwriting reserves.
These funds will be called upon to pay future claims. From time to time underwriters
are asked to insure risks/perils which are new to them and to the insurance market
as a whole. Since historical statistics will be limited or non-existent, the underwriters'
risk-assessment for the new risks/perils is likely to be conservative. This inevitably
means that to begin with premiums are set at a level that may, or may not, prove
to be high.
- A request to an underwriter to grant insurance cover. The underwriter is not
obliged to accept the proposal until he/she has assessed the risk and set the
terms and premium, or at all. Only after the terms and premium have been assessed,
communicated and agreed by the proposer will the underwriter accept the proposal.
- The person, persons or organisation who request insurance. Only after
the underwriter accepts the proposal, either verbally or by word of mouth, does
the insurance come into force.
FORM - The document which insurers send to a proposer to complete before
the insurance is assessed and granted. Most require you to sign a ‘declaration'
in which you declare that you have fully completed the form and have answered
all its questions truthfully. If you fail to do so any subsequent claim may be
recent years, due to the advent of electronic and call centre quotations, fewer
proposal forms are issued. In their place the insurer will send you a written
summary of the information they say you gave them. If you do not correct any wrong
information at that time, and it later is shown to be incorrect or wrong, the
insurer will be entitled to refuse any claim you may make.
information given in a written proposal form, electronically or by word of mouth
to a call centre, is the basis of the contract between the proposer and the insurer.
CAUSE - In the event of a claim, the proximate cause of the damage
or liability suffered must be shown to have been an insured event. That is to
say, there must be an unbroken chain between the insured event and the loss without
the intervention of any other excluded or uninsured event. If there is an intervention,
and that event is not insured by the policy, only the damage or liability caused
directly by the original event will be covered.
example, a fire causes relatively minor damage to the insured property until it
reaches a store of butane gas cylinders, which then explode causing extensive
and major damage. It is found that, being aware of the increased risk of the butane
gas, the insurers of the property had excluded explosion damage. In this event,
only the damage caused by the fire before the intervention of the explosion will
be met by the policy.
- Making good. Where insured property is damaged, it is usual for settlement to
be effected through the payment of a sum of money, but a policy may give either
the insured or insurer the option to restore or rebuild instead
- is strictly, a term that describes the chances of an event taking place. Sometimes
it is used loosely to describe the event itself. The statistics needed to make
the risk-assessment are collected from the experience gathered by each individual
insurer. This is one of the reasons that premiums vary from insurer to insurer.
ASSESSMENT - A process whereby the underwriter calculates the probability
and frequency of a particular event happening, generally and in particular. To
make this risk assessment accurately, the underwriters need large volumes of statistics
going back over a number of years. The premium charged will be calculated from
OF INSURANCE - Is a document that always accompanies the Policy of Insurance.
It contains all of the specific details relevant to the insurance contract in
question, i.e. the name and address of the insured party; the period of the insurance;
the nature of the property or peril being insured; the sum insured if relevant,
the sections of the policy which apply; and any special terms, exclusions or conditions
imposed. In law, it forms an integral part of the Policy of Insurance document
and will be read as such.
- This involves selling borrowed shares in the hope that the price will
fall and they can be bought back at a profit later on. The
Financial Services Authority has tried to clamp down on the
Short-selling of bank shares due to the detrimental effects that it can have on
OF FACT- A
statement provided to the insurer at the inception and renewal of the policy that
confirms that the facts provided by policyholder are true and accurate. This can
be an alternative to a fully completed and signed proposal form
MORTGAGES - Mortgages that carry a higher risk to the lender (and therefore
tend to be at higher rates) because they're offered to people who may have had
financial problems or who have low or unpredictable incomes.
INSURED - It is one of the factors used by underwriters to calculate
the premium chargeable. Broadly speaking, it represents the full ‘value'
of the property being insured. Although it can, and often does, represent the
maximum amount payable for that property, it does not necessarily do so. Check
the wording of the policy document. See also Average and Limit of Indemnity
LIMITS - The geographical area(s) in which an incident that may give
rise to a claim must occur for the insurance to operate. In policies written in
the UK, these limits are invariably stated in the policy document. The most common
areas listed are Great Britain, Northern Ireland, the Isle of Man and the Channel
Islands. Some may include Eire (Southern Ireland) but this must not be assumed.
On request it is possible to extend the limits shown in the policy, but if the
insurer agrees to the request it is likely that an additional premium will be
INSURED/POLICYHOLDER - Are terms commonly used to describe the person
or persons who are insured by a policy of insurance.
COVERAGE - Liability coverage purchased by the policyholder as a protection
against possible lawsuits filed by a third party. The insured and the insurer
are the first and second parties to the insurance contract. This term is often
referred to in motor insurance.
- The person, persons or organisation who assesses the risk and sets
the terms and premium charged for a policy of insurance.
POLICY - Coverage for losses above the limit of an underlying policy
or policies such as motor insurance or home insurance.
GOOD FAITH - The general rule of law
which governs most standard contracts places an obligation on both parties to
the contract to act in good faith, i.e. they must be reasonably honest in their
dealings with each other and must not lie or deliberately conceal information.
They do not have to reveal information that the other party could be expected
to know or readily find out. This general rule is often known as caveat emptor
or "let the buyer beware".
insurance contracts are essentially contracts of trust, they are one of the exceptions
to this rule. Both parties are obliged to act in utmost good faith, i.e. they
must be absolutely honest with each other. Not only must they not lie or deliberately
conceal information, they are obliged in law to reveal each and every fact that
is material to the contract.
parties are subject to this rule but since, in most cases, only the proposer has
all the facts and information material to the risk available, the underwriter
has to rely on the proposer to pass this information on.
most insurances of interest to private landlords, it is accepted that, in practice,
only questions asked by the underwriter will normally be considered as being material.
Information on this page is given without responsibilty for accuracy and should
not be reffered to as any statement of fact.
GOODS - (see also Brown Goods at top) Used commonly as a generic
term to describe kitchen and bathroom apparatus, such as washing machines, refrigerators,
cookers etc. There is no legal backing for these terms and the apparatus need
not be white.
This information should not be relied on for accuracy and is presented here without
the responsibility of jml Property Service and the website it is being displayed
at. ©jml property Services 01/ & 11-09
jargon in the UK
jargon in the UK Housing Market
jargon used in the property market in the UK
Role of the Solicitor for buying and selling property in England and Wales
Problems in Rental Property
To Let - UK & Housing Act 2004
To Let - Europe