Insurance Glossary
Please select any of the coverages listed below to read more detailed information about them.
GENERAL PROPERTY
Property insurance pays for losses and damages to real or personal property. For example, a property insurance policy would cover fire damage to your office space.
GENERAL LIABILITY
In today’s litigious society, even small mishaps can result in large lawsuits. That’s why general liability insurance, along with property and worker’s compensation insurance, are essential for most companies. Liability insurance protects the assets of a business if it becomes involved in a lawsuit. Other coverage for premises and operational liability, medical payments and contractual liability are also included. General liability insurance can be purchased separately or as part of a business owner’s policy.
BOILER AND MACHINERY
Boiler and machinery insurance, sometimes referred to as “equipment breakdown” or “mechanical breakdown coverage,” provides coverage for the accidental breakdown of boilers, machinery, and equipment. This type of coverage usually will reimburse you for property damage and business interruption losses. For example, this coverage would cover fire damage to computers.
DEBRIS REMOVAL
Debris removal insurance covers the cost of removing debris after a fire, flood, windstorm, etc. For example, if a fire burns your building to the ground, the remains of the old building have to be removed before you can start rebuilding. Your property insurance will cover the costs of rebuilding, but not of removing the debris.
BUILDER’S RISK
Builder’s risk insurance covers buildings while they are being constructed. For example, a Builder’s risk policy would cover losses if a windstorm takes down your partially constructed condominium complex.
BUSINESS INTERRUPTION
Business interruption insurance covers lost income and expenses resulting from property damage or loss. For example, if a fire forces you to close your doors for two months, this insurance would reimburse you for salaries, taxes, rents, and net profits that would have been earned during the two-month period.
ORDINANCE OR LAW INSURANCE
Ordinance or law insurance covers the costs associated with having to demolish and rebuild to code when your building has been partially destroyed (usually 50 percent). For example, your three-story building is 100 years old. A flood destroys the basement and first two stories. Because more than 50 percent of your building has to be rebuilt, a local ordinance requires that the building be completely demolished and rebuilt according to current building codes. Property insurance covers only the replacement value, not the upgrade.
TENANT’S INSURANCE
Commercial leases often require tenants to carry a certain amount of insurance. A renter’s commercial policy covers damages to improvements you make to your rental space and damages to the building caused by the negligence of your employees.
ERRORS AND OMMISSIONS
Errors and Omissions (E&O) insurance covers inadvertent mistakes or failures that cause injury to a third party. The act must actually be an inadvertent error, and not merely poor judgment or intentional acts. For example, an E&O policy would cover damages arising from an accountant failing to file the appropriate tax documents, or a notary filling out notarizations improperly.
PROFESSIONAL LIABILITY
Malpractice insurance, or professional liability insurance, pays for losses resulting from injuries to third parties when a professional’s conduct falls below the profession’s standard of care. For example, if a doctor makes a mistake that other doctors of his specialty would not have made, his patient might sue him. A malpractice policy will pay his defense costs and any judgment or settlement. Malpractice insurance is available for doctors, dentists, accountants, real estate agents, architects, and other professionals.
COMMERCIAL UMBRELLA
A Commercial Umbrella policy protects you against a loss due to catastrophic lawsuits by providing business liability coverage above and beyond your basic standard liability policy. Your business can be covered for $1,000,000 up to $10,000,000 or even more in special cases.
EMPLOYMENT PRACTICES LIABILITY
Employment Practices Liability provides protection against the risks related to discrimination claims, workplace harassment, wrongful termination or other employment practices.
DIRECTORS AND OFFICERS LIABILITY
This type of insurance is generally purchased by corporations and nonprofit organizations to cover the costs of lawsuits against directors and officers.
COMMERCIAL AUTO
Commercial automobile policies cover the cars, vans, trucks and trailers used in your business. The coverage will reimburse you if your vehicles are damaged or stolen or if the driver injures a person or property. If your business owns a car or truck, or a fleet of vehicles, you need Commercial Automobile Insurance.
WORKERS COMPENSATION
Workers Compensation Insurance pays for medical care and physical rehabilitation of injured workers and helps to replace lost wages while they are unable to work. It may also provide benefits for dependents of those workers who are killed because of work-related accidents or illnesses.
When it comes to buying health insurance, there’s strength in numbers. That’s why 70% of Americans get their health insurance through their employers.
Why do I need Health Insurance?
When it comes to buying health insurance, there’s strength in numbers. That’s why 70% of Americans get their health insurance through their employers.
Just like other forms of insurance, for your car and your home, health insurance helps relieve the burden of unexpected events: you put away a little in case you need a lot later. You and your family’s health should be of the highest priority.
Every year, the cost of healthcare increases dramatically. Simple same-day surgeries, required tests and emergency attention can add up to thousands of dollars or more.
The overall benefits of health insurance are obvious. You won’t be avoiding the doctor because it costs too much. The hospital bills won’t be piling upon your desk waiting for attention. Your health insurance will provide the help and care you demand. Also, if you drive a car, health insurance will work cooperatively with your auto insurance in case of an accident.
There are many health insurance companies available, offering various types of plans. We are capable to get you the best plan and coverage to suit your needs.
Each plan differs in coverages, payment terms and medical treatment procedures.
Group Dental plans are available in traditional indemnity plans, PPO Plans and Dental Health Maintenance Organization Plans (DHMO). Traditional Dental plans offer your employee’s comprehensive and flexible dental coverage and the dentist or specialist when you need care.
Preferred PPO combines the freedom of a traditional dental plan with the economy of managed care. With the PPO plan, you and your family can visit any dentist or specialist you choose or a high-quality Dental Guard Preferred network dentist, any time you need care. If you do visit a network provider, you’ll receive the highest level of benefits and save on out-of-pocket costs
After any applicable deductible, indemnity and PPO plans pay a generous percentage of dental expense up to an annual maximum. Also available are health maintenance organizations (DHMO) and pre-paid plans in certain geographical regions.
Group term life insurance is a common workplace benefit. It can help protect your employees and their beneficiaries with coverage that could be quite expensive to purchase as an individual.
Plans can be devised to pay a modest benefit, one years salary or key employees may be offered additional options.
Disability income insurance is a valuable benefit f you may provide as group coverage. It provides payments (on a short-term or long-term basis or both) to employees when they cannot work because of illness or injury.
If your employees were injured or got sick and were unable to work, they still need some form of income. Disability income insurance to ensures that if someone becomes disabled, they will l have a source of income.
Plans are available for short and long-term disability for employees who are unable to work because of a disability, and ensure that they will be protected, even if they use up their sick pay.
PERSONAL AUTO
For most of us, our cars are one of the biggest investments we make and to experience a loss could be financially devastating. Auto insurance can cover more than just the repairs on your vehicle. Depending on the coverage you choose, your insurance can:
- Cover medical expenses associated with an accident
- Pay for losses caused by underinsured or uninsured drivers
- Reimburse you for damages suffered because of vandalism, natural disasters or theft
- Pay for legal representation in case of a lawsuit
Figuring out which coverages make sense for you can be confusing. That’s why it’s important to discuss your needs with a Seely & Durland agent who can recommend coverages that are right for you and help identify whether you qualify for any of the auto discounts we have available.
HOMEOWNERS
Your house is more than four walls and a roof. It can provide you with financial security. And, it’s probably your biggest investment. Inside those walls are possessions and valuables that make your house a home—and those items need protection as well.
A standard homeowners policy safeguards your home and possessions against:
- Sudden and accidental damage from electrical current
- Fire and lightning
- Windstorms and hail
- Explosions
- Smoke damage
- Freezing
- Theft
- Glass breakage
- Falling objects
- Weight of ice, snow or sleet
- Accidental discharge of water or steam
- Vehicles
- Vandalism and malicious mischief
Homeowners insurance doesn’t only apply to those who own a single-family house. If you own a condominium, have combination dwellings, rent an apartment or if you have a second home, you can also buy insurance specifically designed for your circumstances.
COMBINATION DWELLINGS
One policy provides both property and liability coverage for dwellings not eligible for a homeowners policy. All coverage options track with the homeowners policy, making it easier to use individually or in combination with homeowners coverage.
CONDOMINIUMS & RENTAL PROPERTIES
If you rent an apartment or own a condominium, you need insurance to protect your belongings. While your landlord or condo association might have insurance, it only protects the building. Your belongings are not covered under those policies. There are several types of residential insurance policies. The HO-4 policy is designed for renters, while the HO-6 policy is for condo owners. They both cover losses to your personal property.
SECOND HOMES
Vacation homes require a special type of insurance–one that protects your vacation home but doesn’t overlap with your already existing homeowners insurance coverage. Most homeowners insurance policies provide limited coverage for personal property at an additional residence. However, if your coverage needs for your vacation home exceed this amount, you’re going to want to fill this gap by purchasing a policy that will cover your vacation home in its entirety. One way to do this is to purchase a dwelling fire policy, which is specially designed for a second home in that it provides coverage for the dwelling itself, along with your personal property. In addition to protecting your home and its contents, we also offer several discount programs to those that qualify.
Term Insurance
Term Life Insurance provides life insurance for a limited period of time or “term” Term life insurance provides only “pure” insurance protection and does not have any savings features typically found in cash-value type life insurance policies. Term insurance offers relatively low premiums, especially during a policy’s early years. Most term policies have renewal features that are fairly routine and automatic as long as you can live with the rising premium levels as you and your policy get older together.
Whole Life Insurance
With Whole life insurance, part of your premium goes toward the insurance portion of your policy, a small part of your premium goes toward administrative expenses, and the balance of your premium goes toward the investment or cash portion of your policy.
The Whole life policy provides insurance coverage for the entire life of the insured regardless of how many years premium is paid. Premiums may be paid throughout the insurers entire life or for a portion of his/her life. Ordinary, or straight life, is how the policy is referred to if the insured pays premiums throughout his/her entire life. Limited Life, is how the policy is referred to when premiums are to be paid over a specified period of time. (30 years or until age 65) The cash value portion of Whole life insurance belongs to the insured.
You can take it out in the form of policy loans or you can cash the policy in. The interest you accumulate through the investment portion of your policy is tax- free until you withdraw it. Premiums with Whole Life insurance are fixed, regardless of your age or health. The premiums with Whole life insurance are higher as opposed to term insurance. The reason for this is that the policy has investment features as well as death benefits. The cash portion of the Whole life policy builds slowly during the first several years because most of the premium goes to cover commissions and administrative expenses. Because of this slow buildup Whole life insurance is not recommended if the policy will be held for less than five years.
Universal Life
Universal life is a variation of Whole life insurance. The difference between the two is that with Universal life the pure insurance part is separate from the investment portion of the policy. Universal life’s investment side is invested in money market funds whereas Whole life is invested in bonds and mortgages. The cash value portion is set up as an accumulation fund. Investment income is credited to the accumulation fund. The death benefit portion (term insurance) is paid for out of the accumulation fund. The cost of the Term insurance is paid for on a mortality basis (age and amount of coverage). Unlike whole life the cash value portion grows at a variable rate. With Universal life the insured can vary his annual death benefit and the annual premium.
Variable Life Insurance
Variable Life Insurance is a form of whole life Insurance, A portion of the premium goes to the term insurance part of your policy; a part goes toward administrative expenses; and a portion of your premium goes toward the investment portion of your policy. With Variable you may choose how the funds in the investment side are invested (stocks, bonds,, mutual funds). You may only choose the investment vehicles that your insurance companies manages.
Life Insurance – Defining Your Needs Is The Place To Start
Life insurance is simply protection to ensure that your family will have financial security when you die. If something should happen to you, how will they be able to continue doing the things they take for granted, like live in a nice home, continue their education, or create a retirement nest egg without you? Life insurance can help provide the answer.
In this section, we’ll help you begin to think about life insurance. We’ll take a look at the two basic types of life insurance, providing you with a framework for considering how much life insurance you need.
UMBRELLA LIABILITY
Umbrella liability coverage protects you from financial catastrophe due to lawsuits. It offers additional protection above and beyond your standard homeowners and auto policy limits and helps eliminate any gaps in your coverage. This type of policy can help ensure you are safeguarding your possessions, savings, and your future earnings.
MOTORCYCLE
Just like personal auto insurance, motorcycle insurance offers similar property and liability coverages.
When you buy an Annuity, an insurance company agrees to pay you an annual payment for a specified period of time.
What is an Annuity and Why Should I Use It?
Annuity literally means “annual payments”. When you buy an Annuity, an insurance company agrees to pay you an annual payment for a specified period of time. What type of Annuity you buy, Deferred or Immediate, will determine whether these income payments start right away, or at some future date.
An Annuity contract between you and an insurance company will allow earnings from your Annuity to grow and compound tax free because there are eligibility requirements and limits on contributions to alternative investments such as IRAs and pension plans, and mutual fund investments are subject to taxation every year, one of the best solutions to the problem of saving enough money for a comfortable retirement is a variable annuity. Although contributions to annuities are not tax-deductible, the investment earnings accumulate on a tax-deferred basis until funds are withdrawn, at which time the money is taxed at then current ordinary income tax rates. There is no limit on the amounts that can be invested.
What are the Common Types of Annuities?
Fixed Annuity – Fixed annuities are designed to provide tax-deferred growth and to provide an income for you. A “fixed” annuity means that money is invested in non-stock market money instruments such as Government Bonds, Corporate Bonds, First Deeds of Trust. There is no stock market risk with a fixed annuity.
Variable Annuity – A variable annuity is designed to provide tax-deferred growth and to provide an income for you at a later date. A variable annuity is an investment vehicle where you choose how to invest the money; the amount you receive later, depends on which investments you select and how they perform.
When you die, there are certain typical problems, which, if not planned for, create a burden on those you leave behind.
Why do I need an Estate Plan?
When you die, there are certain typical problems, which, if not planned for, create a burden on those you leave behind. The objective of an estate plan is to protect your assets and make sure your instructions are followed should you become permanently disabled or die. Some of the tools used to accomplish this are very simple and some are very complicated. Although there are a lot of printed forms and software packages that can assist you in planning your estate you would be well served to consult an estate planning attorney. Once you’re gone mistakes are hard to correct and a poorly designed estate plan can do more harm than good. In the simplest sense, estate planning is the process of assessing your current circumstances to prepare for your future. At the same time, you’ll start to take control of your finances by taking a good hard look at what you have now, and weighing that against what you’d like to own one day. Planning your estate, you’ll become more aware of your finances than ever before.
Estate Planning Goals & Tools
When you die, there are certain typical problems, which, if not planned for, create a burden on those you leave behind.
Estate Planning Goals
• Minimize Death Expense
• Avoid Death Tax
• Assets to Proper People
• Business Survival
• Ease Burden of Your Heirs
Estate Planning Tools
• Proper Medical Coverage
• Life Insurance
• Wills & Trusts
• Buy Sell Agreements
• Long-Term Care Insurance
Estate Planning Documents
When you die, there are certain typical problems, which, if not planned for, create a burden on those you leave behind.
Typical Estate Planning Documents
Will
Revocable Living Trust
Durable Power of Attorney for Property Management
Durable Power of Attorney for Health Care
Insurance Trust
Trust for Children
Property Agreement
Nomination of Conservators
PERSONAL WATERCRAFT/BOAT/YACHT
Watercraft insurance policies provide coverage for physical damage caused by a collision, fire, theft, windstorm, lightning, vandalism, and others. This coverage is broad and often includes machinery and auxiliary equipment, outboard motors, boat trailers and other personal property. Additional coverages are available as well, such as Personal Effects, Boat Liability, Medical Payments and Commercial Towing and Assistance.
