The Huestis Insurance Group

Accident Benefits (also known as Statutory Accident Benefits) (top)
You may receive accident benefits if you or a family member is injured or killed in a car accident

Broker (top)
An insurance broker shops your insurance needs with the different insurance companies they have contracts with to ensure you are getting the best value.

Chargeable Loss (top)
If you are involved in a car accident and your car is damaged, your insurance company is required, by law, to assign the percentage of fault for each of the drivers involved in the accident. This is done by using the Fault Determination Rules which are set out in a regulation under the Insurance Act. The rules help insurance companies deal with accident claims quickly and economically.

Collision or Upset Coverage (top)
This coverage protects you against loss or damage to your insured vehicle when it is involved in a collision with another object, including another car or object, or rolls over.

Comprehensive Coverage (top)
This coverage pays for losses, other than those covered by Collision or Upset, including perils listed under Specified Perils, falling or flying objects, missiles and vandalism.

Property Damage (top)
Damage to the property of others (fence, telephone post), including loss of use caused by your car or another person's car driven by you or a family member

Specified Perils (top)
Pays for losses caused by one of the following: fire, theft or attempted theft, lightning, windstorm, hail or rising water, earthquake, explosion, riot or civil disturbance, falling or forced landing of aircraft or parts of aircraft, or the stranding, sinking, burning, derailment or collision of any kind of transport in or upon which an insured car is being carried on land or water

Absolute Liability - Liability that occurs where one has a duty to fill no matter what the circumstances may be. Absolute Liability is often found in cases involving explosives and in many automobile laws an insured or insurance company may be responsible to a third party irrespective of any statutory faults, negligence or breaches on the part of the insured.

Accident - An unusual unexpected result, attending the performance of a usual, necessary act; an unexpected event which happens by chance or which does not take place according to the usual course of things.

This definition is very simplified. Many pages have been written in judgements defining "Accident" if the matter is likely to become involved or complicated such definitions are readily available in juris-prudence. Generally however this definition broadly covers the interpretation of the word as given by the Courts today.

Act of God - A direct and violent and sudden and irresistible act of nature, such as could not have been foreseen or, if foreseen, its effect could not have been prevented — an inevitable accident, e.g. Flood, Earthquake, etc.

Actual Cash Value - The actual or current value at the time of the loss. This may be the cost of replacing the article with a similar model and in similar condition. It may however involve the price of the article plus any appreciation since its purchase and less depreciation.

Actual Damage - Damage which really exists in fact, as distinguished from potential or possible damage.

Additional Insured - Some forms of policies cover not only the named insured but certain others. Most Automobile policies, for example, insure a specific individual as an insured, but also insure anyone driving with that Insured’s consent. The Additional Insured may be "named"-or "unnamed."

Additional Living Expenses - A provision in many policies to provide reimbursement for costs above the normal living expenses, incurred because the insured is forced to live away from home while the home is being repaired because of fire or other damage. It applies to such expenses as restaurant meals, hotel rooms, transportation, etc. The company however is bound only to pay to maintain the Insured’s usual standard of living.

Adjustment - The process of arriving at an amount of settlement in a claim. It may consist of a series of computations to arrive at the amount of a loss as for example, in an uncomplicated fire loss or it may involve discussions of liability, quantum and other such matters as might be the case in a problem liability claim. It may contain both.

Amount Subject - The amount of exposure in any one loss from the peril against which insurance is issued. Underwriters and company inspectors are responsible to see that the amount subject is in order. For example, in the case of fire insurance it is necessary to know the construction of the building, the fire protection afforded, whether a fire is likely to be confined to a small area or destroy the entire building, and if confined just what are the relative values in the areas most likely to be subject to fire. Attached and adjoining buildings and property must also be considered, both with respect to any possibility of there being a fire hazard to the insured premises and conversely whether insurance is carried by the same company on such property so that in the event of a fire at the Insured’s premises an adjoining or nearby building also insured in the same company may also be a loss thus increasing the amount of potential loss from a fire at that particular location.

Appraisers - are persons who because of their special knowledge are vested with authority in determining the real value of the property or damage.

Arbitration - An arrangement for reaching agreement between two sides by which both sides submit their case to a committee or a person who generally is vested with the authority of giving a final answer to the dispute. In fire policies this is now commonly referred to as "appraisal." The arbitration may be voluntary between any two persons who make up their own terms of reference and generally decide beforehand, whether or not the will definitely be bound by the ultimate ruling. Where arbitration exists because of an agreement, the terms of reference for arbitration appear in the agreement.

Assured - The entity which the insurance company has undertaken to indemnify and protect against loss from certain perils. It is interchangeable with the word "insured."

Attractive Nuisance - The leaving of something attractive to children but dangerous to them, such as a piece of contractor's equipment, supplies, etc., near the road, even though on private property is known as an "Attractive Nuisance."

Property owners are liable when they knowingly leave a dangerous instrument or create a dangerous situation in a place apt to be frequented by children who do not realize their peril and are attracted to the situation probably to play, but are injured.

Audit - Is the examination of a set of books by specially qualified independent individuals to attest to their accuracy. Insurance Company's books are subject to audit by their own auditors as well as the Government. Some forms of policy are based upon a percentage of the payroll and the insurance companies may also "audit" the Insured’s books to check and confirm the reports on the gross earning or payroll of the insured upon which the premiums have been based.

Automatic Reinstatement - Most insurance policies insure against loss of property up to a certain amount. If half that amount has been paid in one loss, during the policy year, then only the other half remains as the amount of the insurance for the balance of the year. The policy, however, may be brought up to the full amount by paying an additional premium. In some policies, however, the amount of insurance is automatically reinstated immediately after the loss so that the amount quoted for insurance remains the same even though the insured, in a series of losses, may have collected an amount totally in excess of the principal amount named in the policy.

Average Clauses - Clauses which estimate the proportion of actual compensation for the loss which is to be paid, having regard to the total amount of the loss, and the relation of this amount to the value.

Bad Faith - 1) Design to deceive or mislead another. 2) Conscious wrongdoing. 3) Constructive fraud.

A gratuitous bailee is one who has the property of another without consideration, e.g., a neighbour stores a wheelbarrow in the winter without payment and merely for convenience of the owner (bailor).

A bailee for hire is one who makes a profit or charge for his services in storing the goods of the bailor (customer), e.g., a furrier (bailee) storing a fur coat for a customer (bailor).

Bid Bond - A bond insuring a contractor submitting a bid on a job will, if the bid is accepted, enter into a contract to do the job and if required to do so, to supply a contract bond (or performance bond).

Binder - A temporary agreement with a new insured granting certain coverages pending the issuance of the insuring policy.

Bodily Injury - Bodily injury is the injury or damage to the physical body of an individual or the destroying of it. It does not include the inanimate injury such as hurt feelings, embarrassment, false arrest, libel, slander, etc. (see also personal injuries which includes these further perils);

Bonds - A guarantee or surety bond is not necessarily carried by an insurance company, although many insurance companies do use their corporate structure and strength in the value of becoming surety to another even though strictly it is not insurance. A bond issued by an insurance company generally protects an individual or corporation known as an obligee from loss arising out of the act or failure of another known as the principal.

A fidelity bond is one in which the obligee is usually an employer and the principal an employee and protects against the principal's fraudulent acts, such as embezzlement, conversion, theft, etc.

A surety bond - the surety, which may be an insurance company, protects a company or individual known as the obligee against failure of performance of another individual or corporation known as the principal. e.g., a municipality is building a building and lets a contract to a general contractor. The municipality would probably require a bond on the contractor to establish the ability to complete the contract. There are, of course, many other applications.

A penalty bond is one in which, in the event of default of the person bonded (principal) the entire amount of the limited bond is due to the obligee to protect from this and other losses.

Bordereau - Detailed information supplied on large sheets in tabulated form is commonly referred to as "Bordereau." It is commonly used in transmitting information on a large number of policies from a branch office to a head office, or from a prime insurance office to a reinsurer. It is more commonly thought of as a means of reporting a large number of insurance policies at one time. It is, however, frequently used for many other purposes, as for example a record of the claims paid by a particular branch, etc.

Broker - An insurance broker is one, generally acting as an independent business person and on behalf of prospective insureds and places insurance with the insurance companies. In difference to the "Agent" the broker acts on behalf of the customers but is paid commission by the company.

Builder's Risk - Insurance covering real property during the course of construction when there is generally a greater hazard and where the values are changing daily.

Burglary - The breaking and entering into a premises. Insurance policies usually require that physical signs of such forcible entry are required - e.g. broken window, forced lock or the like.

Business Interruption - A policy that protects against loss of earning and pays certain continuing expenses, for an insured who has suffered a loss from the peril insured, e.g. a factory may be shut down for several months as the result of a fire. Business interruption insurance as applicable to the risk would pay for the loss of profits during that period (and sometimes the depletion of profits for a period after resumption of operation) and pay the cost of keeping certain key personnel. Also know as "Use and Occupancy" Insurance, although the coverage is slightly different.

By-Laws - Laws made by Corporations, Trading Companies, County Councils, Railway Companies, Public Libraries, etc., under powers granted by Act of Parliament. By-laws are binding unless they are contrary to the law or unreasonable.

Cancellation - The termination of the policy before the end of a policy period. Usually if the company cancels the policy, the insured is entitled to a pro rata return of premium for the unused portion of the policy. If the insured cancels, they are entitled to a short rate (as set out on the policy) return of premium.

Capacity - The limit of the amount of insurance set by a company as to what it will write on a single risk.

Casualty Insurance - Loosely used to describe an area of insurance not particularly or directly concerned with life insurance or fire insurance. It is applicable particularly to personal injury forms of insurance but generally also includes crime insurance, robbery, burglary, aviation, and in many instances the surety business.

Catastrophe - A catastrophe as related to insurance is a large and multiple series of losses beyond the normal expectation or reasonable anticipation of loss by that particular peril, e.g. hurricanes causing very substantial damage, extended damage by flood, fire involving large areas, etc.

Catastrophe Cover - Some major medical expense policies are referred to as Catastrophe Policies. They bear no relation to Catastrophe Hazard. They are policies to protect the individual against the contingency of suddenly being required to pay very large medical expenses. They are usually written on a deductible basis and frequently the insured is required to pay a portion of the remaining amount, usually in the form of a percentage. The policy, however, does protect from extremely large losses at a very modest price.

Catastrophe Hazard - A risk which might involve a large number of insureds at one time. For example, a tornado may damage many homes in a certain area. If one insurer carried that type peril insurance, they might carefully underwrite their business so that they carried only one or two in each block, but in total might have a very substantial loss.

Catastrophe Reinsurance - A type of insurance against events that are not normally foreseeable in size, e.g. large earthquake or flood.

Cede - To assign or transfer over where a company, because of the size of the risk, or because of other concentrations in the particular area find that they are carrying more exposure that they care to in the particular circumstances they may buy insurance from another company and accordingly place part of the risk with that other company. The insurance so placed is ceded to the reinsurer.

Ceded Reinsurance - Where a prime company reinsures a risk or risks with another insurance company, the insurance company accepting such insurance from another company is known as the reinsurer and the amount of insurance transferred is "Ceded Reinsurance." The prime underwriting company may require to know not only the amount of ceded reinsurance with respect to a particular risk but they also require to know the total amount of ceded reinsurance to the particular reinsurance company and a total amount of the insurance ceded to all companies.

Where a policy contains a co-insurance clause with which the insured has not properly complied, the insured also becomes a co-insurer in the loss.

In some countries as for example, France, most of the laws of the country were at one time reduced to a set of rules after the style of the Roman Code although these too have subsequently been subject to certain new statutes.

In some jurisdictions, certain sections of the law are reduced and simplified to a "Civil Code."

Claim - Strictly speaking, claims are the exercising of the rights of insureds to be indemnified by their insurance company. It is frequently used, however, to indicate the amount of claim they are making.

In practice, it is any notification of a possible loss under an insurance policy whether any payment is likely to follow or not.

For every claim that is reported, the insurance company must set aside in a reserve a sum equal to the figure which it is anticipated the claim will cost. This monetary figure or combinations of them are often referred to as "claims," e.g. "that is a $50,000.00 claim" or "We have $2,000,000.00 in automobile claims."

Claimant - One who makes a claim. It is most commonly used in identifying a third party who is making a claim against the insured. Technically, however, it also applies to an insured who is making a claim against the insurance company.

Claim Expense - Claims expenses for work on a particular file are commonly charged to that file, thus the cost of an independent adjuster, the lawyer's fees, expert fees, etc. may be allocated to the particular claim.

Co-insurer - One of two or more persons or companies who may be sharing a loss.

Any company whose policy has application to a loss as with one or more other companies, are co-insurers whether the policies are written separately or together.

Many rules were formulated in feudal time. During the reign of Henry II (beginning 1154 AD), The King's Courts became organized and common law began to evolve. The Courts met frequently and when one court made a decision in connection with a certain issue, that decision was followed by the other Courts and became the law unless modified by statute or by gradual evolution.

This has been followed by the courts of all the Colonies and in due course after the revolution by the United States of America.

This law established by precedent is known as "Common Law" as distinct from laws made up to meet certain conditions and printed in statutes.

Collusion - A secret agreement between persons to defraud another, e.g. an insured and his passenger may misrepresent the facts of an accident in order to get money paid to the passenger under the Insured’s automobile insurance policy.

Commercial Property Policy - A combination policy designed for mercantile risks and covering fire risks with burglary and other similar risks.

Commission - Compensation based upon amount of production, e.g. Independent Insurance Agents are compensated on the basis of a percentage of the premium. The percentage varies with different lines of insurance.

Common Law - American, Canadian and British law derives its force and authority from the universal consent and practice of the people over the years. Certain aspects of the law are written into statutes. The underlying principles and usages and rules of action which do not rest for the authority on this statutory or legislative law are to be found in principles set forth by decisions of the courts over the years.

Completed Operations - Where a contractor has work to perform at various locations and has liability insurance, that liability insurance normally would have application to the work at that particular job during the currency of the job. It protects against liability as the result of accidents in the performance of the work on that job resulting in third party damage. Coverage normally ceases on the completion of the job or the abandonment of the job.

If insurance is required beyond that time, the policy may be endorsed to cover "completed operations."

Conditions - The general terms or requirements upon which the insurance is based, the conditions will commonly include such matters as to the mutual understanding of the parties as to how the policy can be cancelled or renewed, provisions with respect to change of the Insured’s interest, provisions as to what an insured should do in event of a loss, and conditions as to what he should do subsequent to a loss.

A condition precedent is a condition that must be fulfilled prior to the general fact at stake. The insured for example is required to give notice of a claim and fulfil certain other obligations as a condition precedent to his receiving a settlement.

Conditions subsequent are conditions which are applicable subsequent to the event, as for example, the insured is required to co-operate in the disposition of the claim and to co-operate other than in the monetary way, to assist to recover from anyone who is responsible for the loss.

Consequential Loss - The word "consequential" means something following as an effect or result. It is an indirect result of the occurrence that causes the loss.

The difference between a direct loss and a consequential loss can be seen in the destruction of a power station by wind. The damage to the power station is a direct loss by wind. There is actual physical damage directly resulting. The destruction of the power station also interrupts the generation of power by the station. For example, a cold storage plant is without electrical power. Foodstuffs spoil as a result or as a consequence. This is a consequential loss, not a direct loss.

Contract Bond - Is a guarantee of the performance of a construction job at a set price and may include the payment of labour and material required to achieve the completion of the job.

Contributory Negligence - Where there is some negligence on the part of each of two or more persons resulting in an accident, each is known to be contributarily negligent or the accident occurred as a result of the contributory negligence of both. The degree of negligence for each is usually apportioned on a percentage basis thus, where one person is 25 per cent contributarily negligent and the other 75 per cent contributarily negligent, between the two, there is a total of 100 per cent of the negligence causing the accident.

Deductible Clause - A clause defining the amount of loss for which the insured is liable; defines insurer's and Insured’s contributions to cover losses.

Deposit Premium - This is often called "advanced premium" and is a premium paid at the inception of a policy in which there is likely to be a substantial variation in values from time to time. At the end of the term, the actual premium is calculated and adjustment made with the insured by either charging the insured for the additional premium required to make up the proper premium or refunding the difference to the insured.

Depreciation - The decline in value of property from any cause - such as use, wearing out, obsolescence, etc. Depreciation should be taken into account in all consideration .of value, when arriving at the proper amount to be insured, or the amount of loss to be paid, unless insurance is on a valued or replacement cost form.

Disability - Loss of income - usually associated with Accident Health policies. Workmen's Compensation or Employer's Liability policies. Certain benefits are payable for the period of disability.

Total Temporary Disability is where the disability is such as to make the party unable to carry out any part of their normal work, but for which recovery is expected.

Partial Temporary Disability is where the party is unable to put in a full time job but is nevertheless able to perform one or more of their normal work obligations. Full recovery in due course is to be expected.

Total Permanent Disability is a disability that permanently disables the party from resuming their normal gainful employment.

Partial Permanent Disability is the impairment of the use of some function of the body as for example the loss of a finger which lessens the efficiency of the individual but nevertheless does not preclude them entirely from earning a living.

Discovery, examination for - In some jurisdictions the parties to a suit (Plaintiff and Defendant - not the witnesses) may be examined for discover)' which is a semi informal forum usually in rooms of an authorized examiner m which the parties present their documents and answer question as asked by lawyers for the opposing side under oath. The questions and answers may be read into the evidence at the trial. The purpose is to get the facts and issues to save time at trial or to avoid unnecessary trials.

Distribution Clause - Used in a property policy for the distribution of the insurance amount over the several locations of objects covered, in proportion to their value.

Earned Premium - The premium for the amount of insurance used. The amount of premium which would pay for insurance from the inception date of the policy until the particular date at which it is desired to calculate the earned premium. It is the expired portion of a premium.

Endorsement - An amendment added to a written document, particularly an agreement between parties, altering its provisions.

Errors & Omissions Insurance (E&O) - Professional, semi-professional and the serviced type of work may place an obligation on the part of the individual to see that the task is properly performed and any error or omission in the performance of a particular duty may make the individual responsible in damages. Errors and omissions insurance is designed to protect the individual in such a situation.

Estoppel - A rule of evidence which precludes a person from denying the truth of some statement made earlier by him, or by others in cases where the conduct of the person himself has led the innocent person to believe the statement to be true. If, for example, a statement is made in front of the individual and the individual does not deny it, and by such statement he leads the innocent party to believe the statement to be true, he is held to the statement, e.g., if A owns a pen and stands by and watches B sell the pen to C, claiming that the pen belongs to B, then A cannot later reclaim the pen, arguing that it was his.

Exclusion - A type of loss that the policy specifically sets out as not being covered.

Facility - A pooling agreement between all automobile insurers (now replaced in most provinces by the Facility Association) in which a market is guaranteed for all licensed drivers and registered owners. The results of the total industry pool are shared by all members of the agreement.

Facultative Reinsurance - Also called specific reinsurance. It is arrangement made with respect to a specific risk for the purchase of reinsurance as distinct from treaty reinsurance. In facultative reinsurance, the company accepting the reinsurance has the right to accept or reject the risk or to make whatever other arrangement might be desirable in connection with the particular transaction without being already bound by a pre-existing treaty requiring the reinsuring company to accept the risk.

Fidelity Bond - An agreement (not an insurance contract although Fidelity is getting to have more insurance features) whereby the surety, or insurance company agrees to reimburse an employer (obligee) for a loss growing out of a dishonest act by an employee (the principal).

Fiduciary - A relationship between two persons where one is required to perform in good faith certain acts for the benefit of another e.g. a relationship between an executor of the estate and the beneficiaries of that estate. It is common in relationships of certain types of bonds issued by insurance companies.

Fiduciary Bond - A bond guaranteeing the fidelity of persons handling the money or affairs of another, e.g. trustees, receivers, executors, etc.

Fire Department Service Clause - A provision in a fire insurance policy agreeing to pay the cost of bringing a fire department to the location of the property insured in event of a fire. It is valuable where the Insured’s property is not in a built up area with their own fire department or where the risk is sufficiently large to require the possible need of fire department services.

Fire Insurance - Coverage for losses from fire and lightning and also the resultant damage caused by smoke and water. Usually supplemented by Extended Coverage Insurance.

First Surplus Treaty - A reinsurance agreement of the amount immediately above the prime insurance carrier's assumption.

Fleet Policies - A commercial enterprise may own a great many motor vehicles and all vehicles may be listed on one policy. This form is known as a fleet policy. It may be rated by the insured adding new items as they are purchased and cancelling traded vehicles with an appropriate premium adjustment on each occasion. More often, however, the policy provides automatic coverage on newly purchased vehicles and the premium either adjusted on a reporting basis or one of the other methods used to avoid frequent computations for each change.

Floater Policy - A policy covering the same risk at a number of perhaps unspecified locations over a wide area (even world wide); usually includes suggestions of goods being frequently moved from one location to another. E.g. Fur Floater, Jewellery Floater, Contractors Equipment Floater, etc.

Franchise - A provision in an insurance policy whereby the insured pays all claims up to the amount set in the franchise. If, however, any loss exceeds that amount the insurance company assumes full responsibility for the full amount of the loss including the franchise amount.

Fraud - 1) Methods used to deceive to cause unwarranted favourable decision for one's own benefit. 2) Deliberate misrepresentation or misstatement. 3) Concealment of facts which should at the time be made known.

General Average (Marine) ~ That contribution which is made by all who are parties to the same adventure, toward a loss arising out of extra-ordinary sacrifices made, or extra-ordinary expenses incurred by some of them, for the common benefit of all. E.g. where some goods have been sacrificed to save the balance, the loss is "averaged" or spread over the entire cargo.

Gross Negligence - The degree of negligence somewhat greater than ordinary negligence. It may be reckless wanton and willful misconduct causing bodily injury and/or property damage.

Gross Premiums Written - Total premiums received from all sources including reinsurance assumed from other companies.

Group Insurance - Insurance policies which have a considerable number of persons under one contract. It is most frequently found in life and accident and health insurance policies. Although there are now a number of Companies who underwrite Habitational and Auto group insurance.

Hail Insurance - A type of insurance generally purchased by farmers to protect against loss of their crops because of damage to the crop by hail. E.g. Hail Insurance on tobacco crops.

Hangar Keepers Insurance - A form of insurance protecting hangar keepers from their legal liabilities arising from personal injuries or property damage as related to the use of a hangar.

Hazard - 1) A risk or probability that the event insured against might occur. 2) Condition which engenders or increases the chances of a loss.

Hazard, Moral - Hazard arising from character, interest, habits and lack of integrity of the insured or person concerned.

Hazard, Physical - Hazard arising from physical condition or characteristics of the object that is insured, e.g., using and storing volatile materials and substances on the premises.

Hold Harmless Agreement - A contract or agreement in which one party assumes legal responsibility for the acts of another.

Hold-up - The taking of money or property from another by putting the victim in fear of personal violence. The case of a man with a gun threatening the life of an individual if he does not surrender his cash is a typical hold-up, however, a knife or some other instrument which might threaten an individual would still leave the act as a hold-up. In fact, it is quite possible that no instrument at all may be used and if the victim is afraid that the man either has something concealed or may use his fists or anything else to cause him concern for his physical welfare, the act is still considered a hold-up.

Home Owner's Policy - A policy designed to cover the various risks of a home owner in one policy. It is very flexible and may cover little more than fire and extended coverage plus some additional living expenses, theft, vandalism and malicious mischief. It is designed, however, to also extend, if required by the insured to cover seasonal residence, a broad form of personal liability, voluntary property damage, outboard motor and boat, etc.

Hostile Fire - A fire which occurs in or escapes to a place not anticipated, e.g., a fire in a fireplace becomes uncontrollable and ignites something externally.

Hull Insurance - Insurance policies written on a ship covering the ship itself or on an aircraft covering the aircraft itself is known as "Hull Insurance."

Improvements or Betterments - A fire risk may be written for one or three years. During that time, many changes may take place and an insured may himself improve or enlarge the building, change the roof, install new flooring or .a tenant may install a new air conditioned office space which would eventually accrue to the benefit of the real property owner. These are known as improvements or betterments and the amount of insurance should be adjusted accordingly.

Incurred but not Reported Claims (IBNR)- Insurance companies are required to put up reserves on all claims. This even includes claims that have not yet been reported to the company. It is the sum added to the total of claims reserve and is usually determined by means of an estimate based upon the actual claims reported late one year earlier, two years earlier, etc., with proper adjustment made for increase in premium income and inflation.

Incurred Losses - Total of losses paid and loss reserves. The "incurred losses" arc calculated by adding the paid losses (less recoveries by subrogation or salvage) to the reserve for unpaid claims at the end of the period, and subtracting the reserve for unpaid claims at the beginning of the period.

Indemnity - An indemnity is a contract, express or implied, to keep a person who has entered into or who is about to enter into a contract, or incur any other liability, indemnified against loss, independently of the question whether a third person makes default. An indemnity is a valuable consideration.

Indirect Damage - Damage which is not the immediate direct consequence of the peril against which insurance has been taken but flows nevertheless, somewhat remotely from that peril, e.g. a fire may damage a business premises and somewhat more indirectly interrupt the business. The business interruption claim is indirect damage. Similar situations occur where a property is rented and the income for the rent is required in order to meet a mortgage or where the property is rented from another and is destroyed by fire. The loss of rent is indirect damage.

Inland Marine Insurance - Marine underwriters generally divide their general class of risks into "ocean marine" and "inland marine." Inland marine insurance is insurance developed by the marine underwriters other than ocean marine insurance. It affords transportation for goods and materials in the inland waters, or by train, bus, truck or plane and extends to cover other moveable property under such policies as jewellery and fur floaters, personal effects and personal property floaters and similar policies.

Insurable Interest - "To make insurance policies legal and valid, the insured must possess such an interest in the subject of insurance as may be sufficient to involve him in a monetary loss, should the subject be damaged or destroyed." In other words, if he has a direct monetary interest in the property to be insured, he has insurable interest. This interest may be of various character; it may be that of an owner, of a lessee, of a guardian, a bailee, an executor, administrator, bailiff or sheriff, a creditor. As long as there is a real monetary interest, there is an insurable interest.

Insurance - A contract in which one party, the insurer, for monetary consideration agrees to reimburse another, the insured, for loss or liability for a loss on a defined subject caused by specified hazards or perils.

Insured - The person receiving the agreement of indemnity from an insurance company (or person) affording them indemnity from loss from perils as set out therein. Interchangeable with assured.

Insurer - The insurance company or the individual who has agreed to supply the indemnity to an insured against loss by certain perils.

Insuring Clause - Describes the intent of the policy, just what insurance coverage is provided by the policy and in what limits.

Intermediary -1) The agent/broker negotiating insurance or reinsurance contracts for another. 2) Any party representing another party, in negotiation with a third party.

Kidnapping Insurance - Insurance against loss of money in which kidnapping is a means of getting access to the money. The insurance covers named employees for individual or aggregate amounts with deductibles requiring the insured to participate to a defined extent in any loss.

Lapse - Where a policy has been allowed to run for its determined time and has not been renewed, the policy is said to have Lapsed.

Lead Company - The lead company, when a large risk is shared by a number of insurers, is usually the insurer with the largest share of the risk. The lead company would also normally be responsible for appointing loss adjusters in the event of a claim, although the other participating companies would not necessarily be bound by the lead's decision.

Liability Insurance - The type of insurance which covers an insured for their legal liability for injuries or damage to others.

Libel Insurance - The type of insurance written for the protection of persons in the communication media such as TV or radio broadcasters, newspaper or magazine publishers and such. The policy in effect holds such parties indemnified with respect to suits arising out of libel, slander, violation of copyright, invasion of privacy, etc.

Livestock Insurance - Insurance against loss (death) of horses, cattle, hogs, sheep, dogs, etc. owned by the insured. The cover can be on an all risk or a specified perils basis and includes loss by theft. The insurance is usually written by specialist livestock insurers.

Lloyd's - A London market for insurance and reinsurance. Lloyd's is not a company but an association of members, or names, grouped in syndicates, each syndicate being headed by an underwriter.

Losses Incurred - All losses which happened within the period under study, including both those that have been paid and the others which have not yet been paid, but will become payable.

Losses Outstanding - Losses which took place but which have. not yet been paid. These are usually recorded in two ways; either (1) the number of incidents of losses in the various classes of business, and (2) the amount of money involved in these classes, which would appear as a "Loss Reserve."

Loss of Use - Insurance protection against loss due to the inability to use a property because of its damage or destruction. For example, a truck may be badly damaged in an accident and take 2 weeks to repair. The Insured may need to rent another truck during that time to maintain their normal business. They have therefore lost not only the damage to the vehicle for which they have to pay but for the loss of use of it until they are put back in the position they were before the incident.

Loss Reserve - For every claim that is made against an insurance company that company must estimate the probable ultimate cost of that claim and set the sum of money aside in a "Loss Reserve."

Maintenance Bond - A bond guaranteeing the performance of a contractor in a maintenance contract, e.g. a contractor builds a building and guarantees it against defect in workmanship and material for a period of one year. The bond guarantees that the contractor will remain financially sound and will properly perform the maintenance understanding on the building during the required period.

Malpractice - A performance by a professional which is deficient in skill from what might ordinarily be expected of a professional person. The standard of performance to which a professional person will be held is necessarily higher than the standard which an unskilled person would be expected to display.

Manufacturer's Output Policy - Broad form of all risks coverage on the property of a manufacturer after such property leaves the Insured’s premises.

Marine Insurance - Marine Insurance is a form of insurance generally related to the transportation of goods. Originally most goods were transported by ship and across seas or oceans (Ocean marine) but this was gradually extended to include the transportation by train, motor transport, (inland marine) and now extends to include inland water ways, shipping and shipping by air.

Marine insurance is therefore, divided into two general classes; (1) ocean marine and (2) inland marine.

Market Value - The value of assets (stocks, bonds, debentures, real-estate, etc.) cased on a current market valuation.

Minimum Retained Premium - A premium specified on an individual policy which will be the minimum amount retained by the insurer in the event that the policy is cancelled midterm by the insured.

Misrepresentation - An incorrect statement made about a material fact. Misrepresentation can be innocent, e.g., arising from an oversight; fraudulent (in other words, a deliberate untruth with intent to deceive) or the result of extreme carelessness where a statement is made without regard to whether it is true or false. When a misrepresentation is discovered, the insurer may either continue the contract or treat the contract as void with a full return of any premiums paid. In order for the insurer to successfully treat a policy as void, the misrepresented fact must be material to the risk.

Mutual Insurance Company - An insurance company which is owned by its policyholders who formed an association for the purposes of insuring one another against the possibility of fortuitous loss. Each policyholder pays a premium for his or her own policy. If at the end of the fiscal year the mutual insurance company declares a profit, the profit is shared amongst all the policyholders. If the company declares a loss there is also a provision for the policyholders to be assessed a levy to make up for this shortfall.

Named Perils Policy - A policy in which the perils insured against are listed, as opposed to one which insures against "all risks."

Negligence - Failure to use the degree of care expected from a reasonable and prudent person.

Net Line - The amount of insurance the company carries on a risk and retains for its own account. Amount of insurance minus reinsurance equals the net line.

Non-Disclosure - A contract of insurance is based on utmost good faith. An applicant for insurance is required to disclose to the company all material facts which are necessary to underwrite a policy. If the applicant does not disclose all these facts, he/she is guilty of non-disclosure and may risk having coverage voided from inception.

Non-Owned Automobile Policy - A policy which protects the insured against Third Party claims arising out of some other person using their cars in the business of the insured.

Obligor - An infrequently used term usually intended to mean the "principal" in a bond, e.g., an employer arranges for a bond on his various employees to protect the employer against the infidelity of employees. The employer is the obligee under the bond, and the employee is the principal or the obligor. Since the obligor may also mean the surety company, it is generally better to express specifically the intent by indicating either the insurance company or the principal, and not use the phrase obligor.

Ocean Marine - A type of insurance coverage on cargo and ships on the high seas.

Occupancy • Occupancy is the act of holding possession of property or premises. The term implies the us( of the building for the purposes described in the policy, and no other. Vacating a building by removing the furniture and not using it for the general purposes of dwelling, would for example, bring about unoccupancy, which if not assented to by the company, may void the policy. The same applies to mercantile premises.

Occurrence -A happening or event. Casualty policies are usually written on either an accident or occurrence basis. For coverage on an accident basis, the loss or damage must be due to accident whereas, on an occurrence basis all that is required is the happening. In such policies, "occurrence" is often limited by definition.

Optional Settlement Clause - A clause in an insurance policy permitting the insured under certain circumstances to have a choice of benefits.

In accident and health policies the insured may have a choice of payment of various amounts as periodical indemnity for a certain period of time or a lump sum settlement of a predetermined amount set out in the policy.

In a fire policy a dwelling owner who carries insurance to 80 per cent of the value may have repairs made to damage resulting from a peril insured, without charge for depreciation and of course providing the repairs do not exceed the actual value of the property.

Paid Losses - Total payments made by an insurance company to discharge obligations made under policies issued within the particular period.

Payment Bond - A bond guaranteeing the payment of labour and material used in the construction of the particular structure identified in the bond.

Performance Bond - A bond guaranteeing the performance of a contract but not covering labour and material. If coverage is required for labour and material, a separate labour and material bond will be required, or a contract bond which would cover both.

Personal Injuries - All injuries to the person, including non-physical or neo physical injuries such as false arrest, libel, slander, etc., as well as the physical injuries set out under "Bodily Injuries."

Personal Property - Most commonly used personal property is property in which a person has an interest and which is personal, moveable, or separable from real property, e.g. tables, chairs, desks, clothing, jewellery, etc. are personal property.

It does extend, however, to include a building standing on leased ground. Such a building would be personal of the lessee (if the land and building on the land are owned by the same person, it is real property or realty).

Policy Fee - Flat amount added to the basic premium rate to reflect the cost of issuing a policy, establishing records and other expenses.

Pool - A group of insurance companies who unite to underwrite some particular risk. The collecting of premiums and the paying of losses and expenses involved are shared between the companies on a prearranged ratio.

Premium - A sum of money paid by an Insured in consideration of the protection afforded by the insurance policy.

Prescription - In law, a limitation of time within which legal action can be taken by a claimant. In insurance, the period of time in which a claim may be brought by the policyholder. Also Proscription.

Products Liability Policies - Policies which indemnify a manufacturer, wholesaler, distributor or merchant against suits brought by persons who are injured or who have suffered damages by reason of the product sold. A chair leg may give way when someone sits on the chair; hair dye may cause damage to the skin of a customer in a beauty parlour; a foreign substance may be found in a bottle of ginger ale; a pen may leak and ruin a lady's expensive dress; or dye in a new hat may drip in heavy rain all over an expensive raincoat. All such cases subject the manufacturer and the various persons handling the article to a possible claim or suit and protection against such a risk is found in the Products Liability Insurance Policy.

Professional Liability Insurance - Protects professionals against liability for damages and cost of defense based upon his/her alleged or real professional errors and omissions or mistakes.Proof of Loss - A statement made to the insurance company under oath setting out the basis of the Insured’s claim under an insurance policy. A form of Proof of Loss is supplied by Insurance Companies and is usually found convenient for the purpose. The Proof of Loss, however, does not have to be on the insurance company's form. Details as to what information is required to appear on the Proof of Loss are printed in the policy.

Protection Liability Insurance - Insurance against liability which arises because of some secondary cause, such as the act of a subcontractor or agent.

Proximate Cause - The immediate and effective cause of the loss - not necessarily the last event before the occurrence which, in a chain of circumstances leads naturally and directly in the ordinary course of events to the loss. Note difference from "causa causans."

The well known firecracker case perhaps best illustrates the difference between proximate cause and causa causans.

It will be recalled that a boy lighted a firecracker and threw it to another boy in the group. The recipient, fearing an explosion, quickly tossed the firecracker to another and so on until it eventually exploded and a boy was injured. The causa causans is the last boy who threw the firecracker to the boy who was injured. The proximate cause, however, is the boy who started the unbroken chain of events that resulted in the injury.

Rate - A rate is the unit of charge made by the insurer against the property owner. It is based on the experience of the class of risk (incidence and frequency of loss), and is fixed at a level which will enable the insurance company to accumulate sufficient funds from all like risks to pay the losses for the fewer within the class who have losses, and at the same time provide sufficiently for the expenses of collecting and disbursing the fund.

Reinsurance - The placing of part of insurance by an insurance company with another insurer. Thus where an insurance company has a larger portion of the particular risk that they feel wise to carry themselves, they may buy insurance from another insurer thus "reinsuring" part of their risk. The common types of reinsurance are as follows:

Assumed Reinsurance - Risks or part of risks accepted from other companies. Ceded Reinsurance - Risks or part of risks given to other companies.

Excess Reinsurance - Reinsurance arrangement to recover losses over a specified amount, or over the limit of certain policy or policies.

Facultative Reinsurance - Reinsurance arranged on an individual risk basis.

Treaty Reinsurance - Reinsurance arrangement for the continuous systematic placing of risks with another company or group of companies. The reinsurer automatically accepts reinsurance on all risks of nature described in the agreement as soon as they are written by the prime company.

Renewal - A certificate which attests to the fact that an insurance policy has been extended for another term.

Reserve - Insurance companies are required to put up sums of money which are identified for particular purposes. Such monies are known as "reserves." A reserve is required for unearned premiums and the reserve is required for all unpaid claims. The object of these reserves is to protect the insuring public against any possible financial loss.

Return Premium - This is the amount of premium returned to the insured, usually because of the early termination of a policy. It may be a pro-rata return premium or short rate return premium, depending upon the circumstances involved.

Rider - A rider is a separate policy attached to and extending another policy. Extensions of a policy within the general terms of the policy are normally made by endorsements. Where however this extends to additional form of coverage it is performed by the addition of a "Rider" to the policy. Note the difference between "Rider" and "Endorsement."

Risk - The chance of loss. Specifically the possible loss or destruction of property or the possible incurring of a liability. Sometimes refers to the subject of an insurance contract.

Salvage - The value of property after a fire or other peril which value is used to reduce the total loss. Some of the property may be undamaged and quite saleable, some may be partially damaged and repairable and then saleable.

It is also used to mean the removal of goods during the course of a fire to prevent damage or the removal of the goods after the fire to prevent further damage.

In marine insurance, it also means the cost of avoiding the loss of property by the particular peril insured.

In bond or suretyship, it is the amount of money paid back to the principal to reduce the loss before payment by the bonding company and the amount paid after the payment of the loss to the insurance company reducing their loss with respect to that claim.

Self-Insurance - The term describes the assuming of one's own risk instead of buying conventional insurance.

Settlement - An agreement between concerned parties. In insurance, the agreement is usually on the money changing hands to discharge an insurance claim.

Shock Loss - A loss much larger than anticipated, usually large enough to have an impact on a company's underwriting results in any given territory.

Sprinkler - A fire protection system in which sprinkler heads are installed at the ceiling level of the building and at certain regular intervals. A fire automatically activates the sprinkler in the particular area involved.

Statutory Conditions - Special prescribed and standardized conditions that the Provincial Insurance Acts require to be included in fire, automobile and accident and sickness policies.

Subrogation - The substitution of one person or company, for another so that the rights and duties of the original person or company becomes operable by the other.

In insurance, it applies more particularly to indemnity policies. Where an insured is fully indemnified by an insurance company for a loss, the company so indemnifying the insured will, in some instances, have the right to benefit financially from any claim made against a third party who was responsible for the damage in the first place.

Subscription Policy - A policy usually in a fire insurance field in which two or more insurance companies may all subscribe to the one policy and indicating on the policy, the apportionment to be borne by each company.

The advantages to an insured are mainly that all companies offer exactly the same wording and he has only one policy instead of many.

Substandard Risks - Insurance risks that are more hazardous than the standard risks and accordingly require somewhat higher rates.

Surety - A person (or generally an insurance company) who undertakes to agree to be responsible for certain acts or performances of one party to another party.

Surety Bond - An agreement (not an insurance policy) by which the person or insurance company (known as the Surety) guarantees or agrees to be responsible for certain acts or performances which one party is undertaking to perform for another. The person for whom the work is being done is known as the obligee and the person who is required to perform the work is the principal. E.g. A contract bond in which an insurance company as surety guarantees owners of the building under construction (the obligee) that the contractor (Principal) will have sufficient money etc. to perform their undertaking under the contract.

Term - The period of time from the inception to the termination of an insurance policy or bond.

Third Party - The first person referred to outside the particular transaction involved. In an Insurance Liability policy the third party is a person who may be injured or whose property may be damaged other than the insured or the insurance company. There may be many third parties in one case.

Tort - A wrong, or a breach of duty, committed by some person as regards some other person, which gives rise to a cause of action at the hands of the injured party.

Trespass on Land - The act of entering on to the property of another without permission or invitation from the owner.

Trespass of Person - Assault, batter, false imprisonment, malicious prosecution, etc.

Detinue - An action asking for the return of the plaintiff's property or its value.

Replevin - Sometimes an article in itself is virtually irreplaceable and an action in replevin demands the return of that particular article. Again if it is not possible to return the article then judgement is given on its value.

Distress - Sometimes the goods of another might be held as security even without the actual owner's consent, e.g.. Personal property of a tenant may be seized to secure rent. At one time this could only be held as security but it is now possible that in event of the rent due not being paid goods may be sold and the proceeds credited toward the rent. If such goods arc improperly held it is said to be wrongful distress.

Conversion - The wrongful changing of property to which one is entrusted to one's own personal use. e.g. A company automobile is taken by the employee and sold and the proceeds used in the personal affairs of the employee.

Negligence - Doing something a prudent man would not do or not doing something a prudent man would do, the result of which results in loss by damage or injury.

Nuisance - An act unlawfully interfering with the person's use or enjoyment of land including the interference of easements and allowing or causing the escape of obnoxious things on to the land of another.

Umbrella - An insurance policy usually basically affording a high limit excess coverage but frequently extending to pick up many forms of coverage that may be missed between the prime policy companies.

Underwriter - The insurance company or group that underwrites or insures a particular risk.

It is also used as the identification of the individuals within the company whose responsibility it is to accept or reject business in the particular line in which they specialize and in this way choose risks their principals are prepared to underwrite.

Underwriting Profit (or Loss) - The excess of earned premiums over incurred losses and expenses shows the underwriting profit. The reverse would show an underwriting loss.

Unearned Premium - That part of the premium which has not been used or earned, and which must be returned to the insured in the event of cancellation of policy by the company prior to its full term.

Unoccupied - Where the premises is complete with its content except for the human beings, such persons being temporarily away from the premises, as for example on vacation or any other reason, the premises are said to be unoccupied.

Premises that are unoccupied present a greater hazard and standard fire insurance policies permit unoccupancy of the premises for only a certain period of time. If the unoccupancy is going to extend beyond that time, it is necessary to have an endorsement added to the policy. In protected areas, it is not usually difficult to obtain such an endorsement and sometimes without charge. In unprotected areas, it is much more difficult to obtain such an endorsement and an additional charge can be expected. Unoccupancy is distinguishable from "vacant" in that in vacancy, the occupants have moved out without the intention of returning; or in the event of a new building the occupants have not yet taken up residence.

Utmost Good Faith - A phrase in a legal document calling for the highest standards of integrity on the part of the insured and the insurer.

Vacant – Vacant refers to the circumstance where, regardless of the presence of furnishings or contents; all occupants have moved out with no intention of returning; and in the event of a new dwelling/building – no occupant has yet taken up residence.

Vandalism - Vandalism is the intentional damaging or destroying of property.

Vicarious Liability - Liability imposed upon a person even though he is not a party to the particular occurrence, e.g. the owner of a motor vehicle is vicariously responsible for injuries even though he is not driving the car at the time of the occurrence.

Waiver - The intentional relinquishment of a known right. A waiver under a policy is required to be clearly expressed and in writing.

Warranty - A guarantee or assurance. A stipulation in a contract, the breach of which nullifies the contract, such as certain warranties in an insurance policy.

Warranty is essentially a guarantee. Warranty of the contents of a formula guarantees that the formula contained in the bottle conforms with the statement on the outside. A warranty against defects in workmanship and material is a guarantee that if the product is defective, the manufacturer will replace the part or perhaps the product itself.

In insurance, a warranty is the general atmosphere of facts upon which the policy is rated and written.

Without Prejudice - An action taken during claims negotiations designated as ''without prejudice" is intended to be without detriment to the existing rights of the parties.

Wrap-Up Policy - One policy covering all involved interests of a big construction project, e.g., the owner, contractor, sub-contractor, suppliers, etc.

Written Premium - The total amount of premium collected on that class of business or on all classes of business.

The Property of Every Description (POED) format is designed to protect your company's buildings, equipment and stock for one blanket limit. This blanket coverage eliminates having individual limits for each separate property value that is written.

Broad Form: (top)
This form provides coverage on all losses and all property and then uses the exclusions to take away coverage and protection. Some examples of losses which are normally excluded are earthquake, flood, seepage, rodents, vermin, war, nuclear incident, certain types of explosions and bylaws. Many of these exclusions can be added with a rider for an additional premium.

** Note that the flood exclusion does not apply to ensuing loss or damage which results directly from fire, explosion, smoke or leakage from fire protective equipment or from a watermain.

This form is subject to exclusions such as sewer backup, 30 day vacancy, growing plants, money, bullion, automobiles, watercraft, furs, jewellery, boilers and pressure vessels. Again, many of these can be added by endorsement for an additional premium.

Replacement Cost: (top)
Your building and contents will be written on a replacement cost basis which would replace items lost, due to an insured peril, with payment equal to today's purchase price of those items with no deduction for depreciation.

Debris Removal: (top)
In the event of damage to your property, whereas debris cleanup is necessary, this coverage will pay for expenses up to a stated amount.

Inflation Protection: (top)
This endorsement pays for automatic increases of insured amounts on a pro-rated basis throughout the policy year. This protects your property that has a tendency to increase in value over a years time.

Coinsurance Clause: (top)
This clause is used by insurance companies to protect themselves against people under insuring their property. It acts as a penalty clause which makes the insured a co-insurer on any type of loss, full or partial.

Each form stipulates that the limit of insurance should represent a (Stated Amount, 80% or 90% or 100%) of the insured value at the time of loss. Upon valuation at the time of loss if it was determined the insured amount was below the form chosen, then the following calculation will be made and its result will be applied to the loss amount.

———-—————-————— ————- = $ Amount of Loss Paid

Example: Amount of Insurance carried was $100,000. & 100% or Value which is ascertained is $200,000., Loss Amount is $50,000. and form is 80% coinsurance. The amount of loss paid is:

Stated Amount Coinsurance: (top)
This endorsement waives the co-insurance clause, thus eliminating any potential penalties for purchasing inadequate amounts of insurance. An agreed liability limit is the basis for monetary reimbursements and payments and a form is signed by the Insured to confirm the value is agreeable to them.

Deductible Clause: (top)
This clause gives you one deductible as stated per occurrence. In the event of a loss the Insuring company pays only amounts in excess of the deductible.

Earthquake: (top)
Damage caused by earth movement, whether by earthquake, landslide, volcanic eruption, and rising or shifting of land, is covered up to the stated policy limit with a deductible as specified.

Flood: (top)
Damage caused by flood, high tides or waves or rising waters due to a storm, that results in damage to your building(s) or contents, is covered up to the policy limit. Mudslide damage, when caused by these perils, is also included.

Bylaws: (top)
City or town bylaws can affect the cost to repair or rebuild in that the building codes were changed since the existing structure was constructed. These changes often result in extra costs which are not insured in the normal wording. With a specific endorsement, you can purchase amounts of insurance to cover the following situations:

All of these riders require specific knowledge of the bylaws relating to your occupancy in the specific building. Many businesses do not inquire before a loss happens and fail to purchase the required insurance and sustain more of a loss than first thought.

Newly Acquired Property: (top)
This endorsement extends your building and property coverage to include newly acquired property for up to the stated time period. Insurance amounts are up to and including the limits stated for building, contents, etc.

Off Premises Property: (top)
This covers property other than stock for loss or damage due to an insured peril, when that property is temporarily at a location which you do not own, operate, or lease, up to the stated limit.

Peak Season Endorsement: (top)
This endorsement will provide additional coverage during peak business months, where the extra insurance is needed to cover increased exposure to loss. This would eliminate having too much coverage during non-peak months or not enough during peak months. The increased amount is as stated and for the time periods stated.

Property of Others: (top)
This coverage provides protection in the event the property of others, in which you hold for "care, custody, or control", is damaged by a covered peril. A limit must be stated.

Tenants Improvements & Betterments: (top)
This coverage provides protection of the modifications you have completed, affecting the value of your building. This coverage is needed if you plan to partake in the remodeling of your premises or if you are the tenant and the upgrades are at your cost. This limit can be included in the Property of Every Description Limit at your request.

Office Contents Floater: (top)
It is designed to cover your usual office equipment and separates -from other equipment in your business. It often carries a separate and lower deductible than the rest of the policy representing the lower valued items insured.

Brand and Label Clause: (top)
This endorsement will reimburse you for costs when damage occurs to your property and it must be stamped as salvage or voided, or when your labels must be removed from the property items due to damage.

Pollutant Clean Up and Removal: (top)
This coverage pays your expenses to extract pollutants from land or water at the insured property, if the discharge, dispersal, seepage, migration, release or escape of the pollutants is caused by or results from a covered cause of loss.

Radioactive Contamination: (top)
This coverage provides insurance in the event of sudden and accidental radioactive contamination which results in loss or damage to your property or contents.

Selling Price Clause: (top)
This endorsement would pay for loss or damage of your stock at the standard selling price, in the event of an insured peril. This insures merchandise for profits you would have realized had the peril not occurred.

Tenant's Restriction Endorsement: (top)
Applicable to Form 2181 - It is understood and agreed that under Paragraph (D) of Clause 5, there shall be

Applicable to Form 2182 - It is understood and agreed that Paragraph (r) is added to Clause 6.B. as follows:

(r) By riot, vandalism or malicious acts caused by tenants occupying the Insured Premises named in this policy.

Waiver of Subrogation: (top)
This endorsement waives the right by another party to place claim for recovery of a loss, after reimbursing or having made prior payment to your firm for that loss. This waiver protects your relationships with important clients or trade partners.

Stock Reporting Form: (top)
This form allows you to have a variable amount of coverage from one month to the next, depending on the actual cash value of your stock and contents. At the end of the year you will receive a refund or pay additional premium, based on your average amount of coverage over the length of the policy. A monthly report must be submitted to the Company.

This form provides specific coverage which is listed in the wording: Fire and Lightning

If the loss which occurs is not included in one of the above standard coverage then NO coverage applies and NO payment will be made unless an Extension of Coverage is included.

Actual Cash Value: (ACV) (top)
Your building and contents will be written on an actual cash value basis. Any loss will be reimbursed based on the value of the item at the time of the loss, less depreciation.

This policy covers exposure that involve property and merchandise while in transit or "floating" on an "all risk" broad form basis.

Accounts Receivable:
This coverage would provide payment in the event of loss or damage to your accounts receivables whereas those receivables due are deemed uncollectible. Reasonable costs of re-establishing records of the account receivables and the abnormal collections expenses are also included in this broad coverage. An 80% coinsurance condition does apply.

Valuable Papers:
This coverage protects your valuable papers and records in the event of direct physical loss. This covers the cost of reproducing those lost or damaged documents up to the policy limit. Papers damaged or lost while in transit or while in temporary custody of others are also insured. Irreplaceable documents may also be insured at a "stated amount".

Transit Coverage:
This coverage provides protection to your property and merchandise while being transported by an owned vehicle or by carrier. It includes coverage of losses on an "all risks" basis. This can be written for individual shipments of high value or on a blanket basis.

Contractors Equipment & Tool Floaters:
This coverage will protect your movable equipment in the event of damage or loss. As the cost to insure the contractors equipment floater is much lower than the cost of tools, it is important to breakdown the limit for each. A tool is easily removed & carried on person and values are generally $750. or less per item • and need not be scheduled. Contractors equipment is larger and less likely to be stolen and a detailed list including values should be filed with the insuring company.

Sign Coverage:
This coverage provides for those signs scheduled and not forming a part of the building or of high value such as neon, fluorescent, automatic or mechanical signs or lamps.

Exhibition Floater:
This coverage is needed to protect your property while being exhibited at trade shows and conventions. This coverage also provides for the transportation of the property to and from the exhibit.

Fine Arts Floater:
This coverage insures your specifically scheduled paintings, sculptures, etchings, statues and other listed art work items.

Installation Floater:
This coverage provides protection on property in transit or at a customer's premises that is to be installed by your company. Once the equipment or supply has been installed, or upon acceptance and receipt by the purchaser, coverage ceases.

Salespersons' Samples:
This coverage provides payment for lost or damaged merchandise being transported and used as a sample by outside salespersons.

Bailees:
This coverage protects your business in the event a customers' property which you hold care, custody, and control of, is lost or damaged and you or your business is held responsible.

Jewellers Block Coverage:
This covers stocks of merchandise including pearls, precious and semi-precious stones, jewels, jewellery, watches, gold, silver, platinum and other precious metals used or held for commercial purposes.

Ocean Marine Cargo:
This coverage protects your goods and merchandise from perils of the sea while in transport by ocean carrier.

Owners' Motor Truck Cargo:
This coverage protects your property and merchandise while being transported by your carrier. An endorsement has been added to extend coverage to property located at a terminal or loading platform.

Pattern & Die Floater:
This coverage is designed to provide the cost of replacing expensive patterns or dies used to produce products within your premises. This covers both your own property as well as your customers' property.

Builders Risk:
This coverage insures the value of a building which is in the process of being built. The structure, materials, equipment and supplies kept within 100 feet are all covered under this policy. This coverage will be written on an "All Risks" perils basis.

Liability limits are determined by the estimated end value of the insured project.

Coverage can also be extended to include property temporarily away from premises, transit coverage and liability if required.

Computers and other Electronic Data Processing and Media, will be covered with this floater. Covered items include data processing equipment, data processing media (example: diskettes, tapes, software), and reproduction of data. Extra Expenses and Loss of Income due to the loss of use of the computer system and its effect on your income.

Mechanical Breakdown:
This extension provides coverage when your insured data processing item is damaged due to mechanical breakdown, short circuit or other electrical damage to an insured item during normal processing or when being serviced. Media is also included if damaged when in actual use with the insured data processing equipment. This extension is usually subject to a separate deductible of $1,000.

Property in Transit:
This coverage would protect your business in the event an insured data processing item were damaged, lost or destroyed while in transit or while temporarily removed from your principle location.

In the event you could not continue normal business because of an insured loss, this coverage would pay for:

This protection is designed to provide the funds necessary to maintain your financial condition, as if no loss had occurred.

Extra Expense:
This form is purchased to cover those expenses which you will have to pay after an insured peril interrupts your business. You will find that there are expenses to be paid over and above your normal expenses and if you can prove this, this form will pay for those added expenses. Those expenses may vary from relocating costs, new phone lines, sub-contracting of work, necessary increased cost of rents, etc.

after 1st 30 days - up to 40% of limit insured after 2nd 30 days - up to 70% of limit insured after 3rd 30 days - up to 90% of limit insured after 4th 30 days - up to 100% of limit insured

Experience shows that most of the extra expenses occur during the first two periods and the payment schedule relates this fact. We can negotiate different lengths and percentages to fit your needs.

Rental Income:
Your rental property is covered against loss to the structure and certain contents. This coverage extends the protection to include reimbursement for rental income lost should that property be rendered uninhabitable, whereas you would receive payment equal to that which would have been received had the loss not occurred.

Gross Earnings:
This form will provide for lost income due to a loss of an insured peril up to the limit shown for the specified indemnity period, usually 12 months, or the day operations resume, whichever occurs first. It will pay for lost income (developed from previous period experience) minus those expenses which will cease to be incurred due to the interruption of the business. Costs such as payroll, cost of stock, utilities and any other expenses normal to your ongoing operations are covered automatically.

It is best to complete a worksheet to determine the amount required to insure. Specific extensions for expenses can be added upon request for things like payroll of employee's (referred to as "ordinary payroll") which will assure their availability when it is time to resume operations. While calculating the limit required, it will be important to determine the amount of time it will take to resume the operations. Factors such as length of time to reconstruct the premises or the length of time to order, receive and install specialized equipment must be considered.

This form ceases to make payments the day the business returns to operation (even partial). This form best suits those businesses which will not result in lost future sales or regular customers.

Profits:
This form provides much the same protection the Gross Earnings form does but allows the customer to determine expenses to include in the limit of insurance. These expenses are called Standing Charges and when calculating the limit required, it's advisable to list these charges which can include "Ordinary Payroll".

The biggest difference and advantage of the profits form to a business which will lose customers due to a failure to operate and might take some time to regain the old customers, or develop new customers to regain the sales levels prior to the Insured loss, is payments will continue after the operations resume. Whereas the Gross Earnings form ceases to make payments when the business resumes operations, the Profits Form will continue for a set period of indemnity (usually 12 months) or until prior to loss levels are achieved. This form will pay the difference between the actual sales after re-opening and the estimated sales if the loss never occurred based on previous years and current trends.

Ordinary Payroll:
You can insure all normal payroll (excluding Owners, officers, executives and managers - already automatically included) for coverage after a loss to assure those employees remain available to you when you are ready to resume your operations. This can be purchased for a specified limit of time (i.e. 90 days).

Professional Fees:
This will pay the expenses to have somebody determine the amounts lost due to the interruption of business by looking at past performance and present trends of your business, i.e. Auditor.

Off Premises Power:
This coverage provides payment in the event an off-premises power failure, communication network breakdown or lack of sufficient water supply causes an interruption of business and subsequent loss of income.

Stated Amount:
The insurance company will agree to waive any co-insurance thus agreeing that the amount of insurance purchased is adequate and sufficient. In the event of a loss the amount is agreed to in advance. A Business interruption worksheet is mandatory and must be completed in full and signed by an officer of the company.

Contingent Business Interruption:
This coverage provides protection in the event you were to lose income as a result of damage or loss sustained by a major supplier, distributor or customer. You would receive payment of income up to the limit specified or for the period specified whichever comes first.

This policy provides payment in the event of a "liability" loss that causes injury or property damage during the policy period only - "occurrence" form. It protects your business against liabilities that arise from your daily operations, the products you sell, or the services you render.

Premises or Operations:
This coverage protects your business in the event of loss due to bodily injury or physical damage arising from ownership, maintenance or any use of the insured premises. It also covers the operations performed by your firm.

Products & Completed Operations:
This coverage provides protection in the event of claims pertaining to your products. It covers real or alleged defects in the products you manufacture, sell, handle, or distribute. It also provides coverage in the event of claims pertaining to real or alleged faults in work or services completed by your firm.

Broad Form Property Damage:
This coverage expands your general liability policy to include certain property while in your care, custody, or control. When performing normal operations, the property is insured from damages resulting in a loss of use, for which you (or your business) are held liable.

Property Damage Occurrence:
An occurrence is an accident which occurs sustaining damage to others or their property. This is extended to include continuous or repeated exposures to harmful conditions in specific and defined instances.

Personal Injury:
This coverage protects your business in the event of "injury" due to: false arrest, detention, imprisonment or malicious prosecution, libel or slander, defamation of character, wrongful eviction or entry, invasion of the right of private occupancy privacy or personal injury assumed by a contract. This coverage is enforced when you are held liable for damages.

Medical Payments:
This coverage pays for medical expenses incurred by persons as a result of injury due to an accident on your premises. The coverage pays to the established limit, regardless of who was at fault.

Employers Liability:
This coverage would protect your business against a legal action brought forth by a person or persons arising out of their employment. Note, where workmen's compensation plan is in place then Contingent Employers Liability will apply.

Blanket Contractual Liability:
This coverage protects your business when liability arises from obligations you have assumed under specific or implied contracts with others.

Employees As Additional Insured's:
This endorsement extends your policy to include your employees as a Named Insured while acting within the scope of their work related duties.

Tenants Legal Liability:
This coverage protects your business against financial loss in the event your leased or rented property is damaged due to fire or explosion caused by your operations. Payment is made when your firm is held legally liable. Broad Form Tenants Legal Liability is an all risks form.

Non Owned Automobile:
This endorsement provides coverage for the operations, maintenance or use of non-owned automobiles when damage or injury occurs in direct relation to your business operations.

Limited Worldwide Liability:
This coverage protects your business in the event of suit from outside Canada and its territories, as well as the United States, when you are found liable for damages resulting from products you sell for use in foreign countries. The suit must be brought into policy Territory Limits.

Advertising Injury:
This coverage protects your business from advertising "injury" to others. Coverage includes lawsuits arising from your advertising or promotional activities, where you are held liable for piracy, unfair competition, unknowing infringement of copyright, slander or libel.

Elevator Collision:
This coverage provides protection in the event of an elevator accident in which the elevator or the property it is carrying is damaged or destroyed.

Liquor Liability:
This coverage protects your business when held liable for loss or damage that occurs due to the serving of alcoholic beverages. Host Liquor Liability refers to serving of same incidental to your operations -example: company functions.

Contractors Protective Liability:
This coverage would protect your business in the event a hired sub-contractor is held responsible for injury or damage to others, while performing operations under contract with your firm. It provides coverage when the employed contractor proves to be underinsured and cannot cover the entire loss. Defense expenses related to the loss are also included.

Incidental Medical Malpractice:
This coverage protects your business when liability arises from the administration of medical aid by an employee(s) which results in injury to a member of the public. Your firm as well as the employee(s), when held liable for malpractice, is covered if the aid was given on premises.

Broad Form Equipment:
This coverage protects your business from claims arising from the use of mobile equipment operated and maintained primarily for transportation of items other than products, stock, or cargo, and excluding the mobile equipment used for transporting of any persons. Land vehicles, and mobile machinery and equipment are covered.

Employee Benefits:
This coverage would protect your business in the event you were held liable for claims arising from your employee benefits program. In the event of loss due to improperly counseling plan participants, handling records carelessly, failing to enroll or terminate employees, or improperly interpreting coverage, you would be covered up to the stated limit.

Vendors Coverage:
This coverage extends your products liability coverage to include any of your vendors when distributing your products.

Watercraft Liability:
This coverage provides protection in the event of bodily injury or property damage arising out of the ownership, operation or use of watercraft owned by your firm.

Limited Pollution Liability:
This coverage provides protection in the event your business is held liable for pollution related damages caused by your products & completed operations, whether by sudden or gradual emission. A policy can be designed to provide protection including clean up costs incurred. Different amounts of protection can be purchased depending on the exposure of your individual business operations.

Explosion, Collapse, Underground Property:
This coverage (also known as XCU) provides insurance protection for your business in the event of damage to the property of others due to an explosion (other than caused by boiler), collapse of structure or underground maintenance and where your business is held liable.

Extended Bodily Injury:
This coverage protects you or your employees when held liable for damages caused by assault and battery or physical restraint of persons on your premises, or in the course of your operations, which results in bodily injury. This covers intentional acts when necessary to protect your property or the lives of others.

Claims Made Form:
Under a claims-made policy, the trigger of coverage is when the claim is made rather than when the damage occurred. A retroactive date (which is the effective date of the first claims-made policy) is specified in the declarations. Coverage will not be extended to any claims, whenever made, which result from an occurrence before this retroactive date. (This coverage will presumable be provided by the occurrence policy in force at the relevant time.) The policy responds to only those claims brought during the policy period provided the claim results from an occurrence which took place during the policy period. Extended or Unlimited tails may be purchased at additional costs.

This policy protects your business in the event of mechanical equipment failure or damage of a covered object which results in financial loss to your business. It covers losses to your insured property as well as the property of others. In the event an insured object causes an "accident", the Boiler and Machinery policy would pay for damage and repair of property, excluding any subsequent fire related damage, which would be covered by our property insurance policy. Insurable Objects consist of any boilers, pressure vessels, refrigeration equipment and electrical apparatus, excluding production machinery.

Business Interruption:
In the event a loss of an insured object caused by a boiler or machinery peril results in an interruption of normal business, coverage is afforded for the form of Business Interruption & Limit specified. Gross Earnings, Profits, Rental Income, and Extra Expense are common forms.

Consequential Loss:
In the event of an accident involving an insured boiler or machinery object, coverage is provided for resultant spoilage of property or product to the specified limit.

Power Interruption:
This coverage would protect your business in the event of power failure which results in a loss of equipment usage and/or profits when that source of power is used exclusively by your firm.

Ammonia Contamination:
In the event of a leakage of ammonia, whether from a refrigerator or other source, which results in the contamination of stored goods, coverage is afforded.

Production Machinery:
If your business relies on production machinery, vital to your operations, this extension can protect against loss due to the breakdown of those insured items.

There are various forms of crime coverages available. It should be noted that even crime policies which provide the broadest range of coverage do not provide coverage against loss arising out of all types of crime.

."Burglary" is the felonious taking of property from the insured premises after making a forcible entry into the premises and leaving signs of that entry.

"Robbery" is the felonious & forcible taking of insured property by threatening or inflicting violence upon the custodian or employee, on or off the premises. Property can be money, securities, merchandise or furniture and fixtures.

"Theft" if the wrongful abstraction, disappearance or actual destruction of the insured property.

Forms of Coverage

Employee Dishonesty:
This coverage will protect your business in the event fraudulent or dishonest acts are committed by an employee, either alone or in collusion with others excluding partners. There are two forms. Form A is blanket form for limit per loss regardless of how many persons are involved. Form B is a Blanket Position bond and the limit is per employee and is not capped at a limit per occurrence.

Broad Form Money & Securities:
This provides coverage of money, securities against destruction, disappearance and wrongful abstraction both at the premises insured and at the banking premises, including both burglary & robbery.

Inside Outside Hold-up:
"Hold-up" protects for "robbery" only. The Inside Hold-up coverage does extend to property stolen from a window display during a "smash and grab" robbery. The outside coverage extends to property stolen from a custodian away from the premises while carrying deposits or while at home.

This policy will protect your officers and directors in the event they are held liable for damages caused by error, mismanagement, negligent acts, misleading statements, omission, or any other wrongful act that results in financial loss to others.

A company reimbursement (or corporate indemnification) endorsement will reimburse a named insured director or officer for expenses incurred while defending against suits claiming wrongful acts committed.

This policy is designed to provide protection against claims arising from perils of pollution and contamination associated with the operations of your business. This coverage also includes cleanup costs incurred.

Bodily Injury, property damage and environmental impairment losses are covered under this policy when directly related and caused by your business operations.

Environmental impairment losses can be defined as those claims that arise from perils of pollution and contamination associated with the existence hazards of landfills, sanitary dumps, hazardous material sites and the transportation of materials to such locations.

Other exposures common to local residents and/or businesses such as fuel and holding tanks are covered as well.

If any single insurance policy could be called the most important of the Insured's entire Account Program, it is the umbrella. This coverage provides excess general liability, automobile and other underlying coverage and also protects the insured from the exclusions and gaps of the primary liability policy or policies. An umbrella liability policy comes into play when the limits of the primary insurance have been exhausted, or when a claim develops that is not covered by the primary insurance. Special features are the virtual elimination of concern of catastrophe losses by means of high limit protection and broadened protection for third party claims, including worldwide coverage, blanket contractual liability coverage, coverage of property in care, custody & control of the insured, non owned aircraft and watercraft liability coverage, advertisers liability coverage and automatic coverage for additional insureds.

This policy provides coverage for individuals, firms or associations as a result of claims arising out of the negligent performance or non-performance of their professional duties. These policies are specifically designed to cover the medical and fringe medical professions. This type of policy is normally written on a claims made form.

In addition to the medical and fringe medical professions, other occupations carry with them the risk of claims arising out of the negligent performance, or non-performance of their duties. Lawyers, accountants, insurance brokers, real estate agents and publishers, as well as many other types of occupations are subject to suits brought against them for their errors or omissions. This type of policy would provide the insured with a defense of their claim and the payment for awards made against them. This type of policy is normally written on a claims made form.

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