Replacement Cost
Insurance which pays the amount needed to replace damaged personal property or home property without deducting for depreciation.

Lapse
Termination of a policy because of failure to pay the premium.

Endowment Insurance
A form of life insurance payable to the insured if living at the end of the endowment period or to a beneficiary if the insured dies before the endowment date.

Universal Life Insurance
A flexible premium policy that combines protection against premature death with a cash value account that earns a money market rate of interest. Death benefits can be altered during the life of the policy within limits, generally subject to a medical examination. Once funds accumulate in the cash value account, the premium can be paid at any time but the policy will lapse if there isn’t enough money to cover annual mortality charges and administrative costs.

Group Insurance
Insurance policy or health services contract covering a group of employees (and often their dependents) under a single contract issued to an employer or other group by an HCSC, HMO or other insurer.

Homeowner Policy
A package or multi-line policy providing the protection needed by most homeowners. The policy provides property insurance, including theft, with very broad coverage on both the building and the contents.

Health Plan
A generic term referring to a specific benefit package offered by an insurer.

Pro Rata
Distribution of the amount of insurance in one policy, among the several objects or places covered, in proportion to their value or to the amounts shown. The distribution of liability among the several insurance companies having policies on the risk.

Flood Insurance
Flood damage coverage is available from the federal government but is sold by licensed insurance agents. Flood coverage is often excluded under homeowners policies. However, flood damage is covered under the comprehensive portion of a car insurance policy.

No-Fault
Auto insurance coverage which pays for each driver’s own injuries, despite who was responsible for the accident. No-fault coverage varies with each state.