[et_pb_section fb_built="1" _builder_version="4.0.9"][et_pb_row _builder_version="4.0.9"][et_pb_column type="4_4" _builder_version="4.0.9"][et_pb_text _builder_version="4.0.9"]<h2 class="h1 text-tc-blue-800 font-weight-bold" style="text-align: center;"><strong>Understanding Business Insurance Terminology</strong></h2>[/et_pb_text][/et_pb_column][/et_pb_row][et_pb_row _builder_version="4.0.9"][et_pb_column type="4_4" _builder_version="4.0.9"][et_pb_text _builder_version="4.0.9"]<div align="center">
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<p style="text-align: left;"><span style="color: #0a0a0a;">Business terminology shouldn’t be reserved for insurance agents. Once you’ve reviewed this business insurance glossary, you’re one step closer to understanding just how much your business insurance policy affects you and your company.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Aggregate limits:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This is the maximum amount of money that an insurer is contracted to provide to the policyholder in a specific policy period. For example, on a particular business liability policy, an annual aggregate limit would be the total amount the insurance company would pay for all claims on that policy in a given year.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="2c13bf22-39b5-5adb-bfd3-c13de698f4fa" href="https://www.trustedchoice.com/business-insurance/coverage-types/blanket-policy/" style="color: #0a0a0a;"><strong>Blanket insurance</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This policy allows a business owner to insure multiple property types at one location, or one property type at multiple locations, all under one policy.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="3d3462d7-7e5a-5e06-83a7-dd93e6615fbb" href="https://www.trustedchoice.com/business-insurance/coverage-types/builders-risk/" style="color: #0a0a0a;"><strong>Builders risk insurance</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">Provides protection for all building materials – on-site, off-site, and in transport – that a builder uses during the course of a construction project.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Business interruption insurance:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">If your business must shut down due to a covered loss, this form of coverage can provide reimbursement for the expenses that would have normally occurred if the business had been operating.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Business owners policy (BOP):</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This is a combined policy where property insurance and liability insurance are packaged together at a cost savings for small businesses.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="ceec5868-eb59-5940-9ddf-1108b9aeacad" href="https://www.trustedchoice.com/business-insurance/coverage-types/fiduciary/" style="color: #0a0a0a;"><strong>Fidelity bonds</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This is a type of insurance that protects an employer from dishonest employee acts.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Commercial property insurance:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This policy is meant to protect the building and other business property that you own or lease. Note that equipment insurance is typically a separate policy.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="4a979eb0-86b5-5482-9944-3cf9c2e425e4" href="https://www.trustedchoice.com/commercial-vehicle-insurance/" style="color: #0a0a0a;"><strong>Commercial auto insurance</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This policy covers you, your employees and company vehicles for injuries and damage, whether the vehicles are leased, owned, or rented. Passengers are also covered.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Commercial earthquake insurance:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">Provides coverage for property damaged in an earthquake. Typical business property insurance will not pay for this damage.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Commercial flood insurance:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">Provided by the National Flood Insurance Program (NFIP), and available through agents, this policy provides coverage for flood damage related to high waters, hurricanes and excessive rain runoff.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Data breach insurance:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This coverage can provide assistance in preventing a data breach as well as mitigate the consequences of a full-blown data breach.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Directors and officers liability insurance ("D &amp; O"):</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">If the directors or officers of a company are accused of wrongful or negligent acts, this coverage can protect the company’s financial assets from legal settlements and the cost of legal defense.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Employer’s liability insurance:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">If an employee files a lawsuit after being injured on the job, this insurance protects the employer. If an employee has workers' compensation benefits, the right to sue is limited.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="e127a4bf-89bf-5a39-a8c9-3f8fed098935" href="https://www.trustedchoice.com/business-insurance/liability/epli/" style="color: #0a0a0a;"><strong>Employment practices liability insurance</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This coverage provides company protection if someone is accused of an employment-related claim, such as harassment.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Professional liability insurance:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This policy provides liability protection in the event that an employee or the business commits a professional error or act of negligence that results in a client's personal loss or injury. This can be anything from a physician's error (malpractice insurance) to an accountant's mistake (E and O insurance) that leads to a monetary loss </span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Exclusions: </strong>These are certain risks that aren’t covered by your insurance policy. You may need to purchase extra coverage for further protection against excluded risks.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="ceec5868-eb59-5940-9ddf-1108b9aeacad" href="https://www.trustedchoice.com/business-insurance/coverage-types/fiduciary/" style="color: #0a0a0a;"><strong>Fiduciary</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">An employee or contractor of the company that has been entrusted with the handling of benefit funds.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="7196c90a-771c-55b8-ac92-7bb8692fbf40" href="https://www.trustedchoice.com/business-insurance/liability/" style="color: #0a0a0a;"><strong>General liability insurance</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This policy will protect businesses from most situations where the company could be held liable for bodily injury or property damage. It does not include commercial vehicle or professional liability coverage, which are covered separately.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="fcaf294f-0882-5c19-b483-0f974a70612d" href="https://www.trustedchoice.com/business-insurance/employee-benefits/group-health/" style="color: #0a0a0a;"><strong>Group health insurance</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">Medical insurance that an employer offers to employees, who are covered or reimbursed for healthcare services according to the specific health plan chosen.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="5a0316fb-07bc-55a6-a6a2-e7e1a224a8fe" href="https://www.trustedchoice.com/business-insurance/employee-benefits/group-life/" style="color: #0a0a0a;"><strong>Group life insurance</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">Insurance offered by an employer that allows the employee to select a death benefit, which is distributed to named beneficiaries at the time of the employee’s death.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Key person insurance:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This policy provides business life insurance on one key person in a business. It issues benefits to help offset earnings loss and find a replacement for the key person.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Loss control:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">A risk management tool that aims to reduce the amount of loss a company experiences.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Marine insurance:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This coverage provides protection for company equipment or goods in transport. It also provides coverage if the vehicle transporting the goods is damaged, and provides liability coverage for third parties. You can choose between ocean marine coverage and inland marine coverage.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Named peril:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">An event or hazard that is listed as covered on your business insurance policy, and will be covered if it occurs.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Performance bond:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">A type of surety bond that ensures the policyholder will complete a contract.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Premium:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">The amount that you pay for insurance coverage.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Rider:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">Also referred to as an endorsement, this is an addendum that will alter or enhance the current policy’s terms. For example, you may be able to add an equipment rider to your property insurance to protect your equipment.</span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="502fcdce-4b9a-5185-a248-160789ec6e32" href="https://www.trustedchoice.com/business-insurance/coverage-types/surety-bonds/" style="color: #0a0a0a;"><strong>Surety bonds</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">A surety bond is three-party bond that guarantees the principal will perform the obligations set forth by the obligee, or else the surety will step in to help the obligee recuperate losses.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="6a39b5ad-a855-5dfa-ac57-8259b6ddb71a" href="https://www.trustedchoice.com/business-insurance/coverage-types/umbrella/" style="color: #0a0a0a;"><strong>Umbrella insurance</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">An umbrella policy is extra liability coverage that can dramatically increase a firm's ability to settle claims or cover the cost of court judgments in the event of a sizable lawsuit. Typically sold in increments of $1 million, umbrella liability is available at a relatively low cost.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><strong>Underwriting:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">Underwriting is the process that takes place with most insurance applications. Underwriters review potential insurance risks and set the appropriate premiums.</span></p>
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<p style="text-align: left;"><span style="color: #0a0a0a;"><a data-item-id="b1857861-67b4-5266-967b-16298f6bfcd7" href="https://www.trustedchoice.com/business-insurance/workers-compensation/" style="color: #0a0a0a;"><strong>Workers' compensation insurance</strong></a><strong>:</strong></span></p>
<p style="text-align: left;"><span style="color: #0a0a0a;">This policy will provide compensation for an employee’s medical bills, lost wages, rehabilitation and disability coverage in the event of a work-related illness or injury.</span></p>
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<div align="center" style="text-align: justify;"><span><span style="color: #000000;"><br />To read the full article, </span><a href="https://www.trustedchoice.com/business-insurance/coverage-faq/terminology-glossary/">click here</a><span style="color: #000000;">.</span></span></div>[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]