Insurance Glossary
Every insurance term that matters, defined in plain English. 60 entries, curated for Florida homeowners.
41 terms
4-Point Inspection
A carrier-mandated inspection of four systems - roof, electrical, plumbing, and HVAC - required for older homes (typically 25-30+ years) to assess insurability risk.
A5 terms
Actual Cash Value (ACV)
Replacement cost minus depreciation. An older roof or appliance is worth less under ACV. The opposite of Replacement Cost Value.
Additional Living Expense (ALE)
Coverage D on a homeowners policy. Pays the extra cost of temporary housing, meals, and transportation if a covered loss makes your home uninhabitable.
Adjuster
The person who investigates your claim and determines the payout. A 'field adjuster' inspects the property. A 'desk adjuster' works remotely. A 'public adjuster' is hired by YOU and works for a percentage of the settlement.
Appraisal
A dispute-resolution clause in most policies. If you and the carrier disagree on claim AMOUNT (not coverage), each picks an independent appraiser and those two pick an umpire. Any two of the three set the final value.
Assignment of Benefits (AOB)
Contract where you sign your claim rights over to a contractor in exchange for repairs. Heavily restricted in Florida after 2019 reforms and virtually eliminated by SB 2-A (2022) for property insurance.
B1 terms
Binding
The act of making a policy effective. After the carrier reviews the application, inspections, and payment, they 'bind' coverage as of the effective date.
C4 terms
Citizens Property Insurance
Florida's state-backed insurer of last resort. Created in 2002 to cover homeowners who cannot obtain private-market insurance.
CLUE Report
Comprehensive Loss Underwriting Exchange - a database of homeowners insurance claims linked to you and your property for the past 7 years. Pulled automatically by carriers during underwriting.
Coinsurance
The 80% rule in homeowners insurance. You must insure your home to at least 80% of replacement cost; under-insuring triggers a proportional reduction in partial claim payouts.
Cross-Report Intelligence
Vcita's system where findings from one inspection automatically flow into all related reports (4-Point, Wind Mit, Home Inspection, Insurance Package), ensuring data consistency across documents.
D4 terms
Declarations Page (Dec Page)
The 1-2 page summary at the front of your policy listing named insureds, address, policy period, coverages, limits, deductibles, premium, endorsements, and mortgagee.
Deductible
The amount you pay out of pocket before the insurer begins paying a claim. Florida policies typically have separate AOP and hurricane (percentage) deductibles.
Depreciation
The loss of value of an item due to age, wear, and obsolescence. Used to calculate ACV settlements.
Depreciation Holdback
The portion of a replacement cost claim withheld by the carrier until repairs are completed and documented. Also called recoverable depreciation.
E3 terms
Elevation Certificate
A FEMA form prepared by a licensed surveyor documenting your lowest floor elevation relative to Base Flood Elevation. Can dramatically lower flood insurance cost.
Endorsement
A written change or addition to a policy, either adding, removing, or modifying coverage. Also called a 'rider.'
Extended Replacement Cost (ERC)
An endorsement that pays 25-50% ABOVE Coverage A if reconstruction after a total loss exceeds your dwelling limit - typical after a hurricane material surge.
F3 terms
First Notice of Loss (FNOL)
The initial report of a claim to the insurer. Starts the claim timeline clock.
Flood
FEMA-defined inundation from overflow of tidal/inland waters, unusual surface water accumulation, or mudflow. Storm surge from a hurricane is flood and NOT covered by homeowners policies.
Force-Placed Insurance
Coverage imposed by your mortgage lender when your regular policy lapses. Typically 2-4× more expensive, protects only the lender's interest.
G2 terms
Ground Sample Distance (GSD)
The real-world size represented by one pixel in an aerial image. Lower GSD = higher resolution. Vcita drone: <1 cm. Satellite: 15-30 cm.
Guaranteed Replacement Cost (GRC)
Rare endorsement paying whatever reconstruction actually costs with no cap. Mostly unavailable in Florida since 2017.
H4 terms
Hip Roof
A roof sloping down on all four sides, with no vertical gable walls. Favored in hurricane country and earns a wind mitigation credit.
HO-3
The most common homeowners policy form for single-family homes. Covers the dwelling on an open-perils basis and contents on a named-perils basis.
HO-6
Homeowners policy for condominium owners. Covers interior walls-in, personal property, liability, and loss of use. Works in tandem with the association's master policy.
Hurricane Deductible
A percentage-based deductible (typically 2%, 5%, or 10% of Coverage A) that applies specifically to hurricane damage. Triggered by an NHC watch or warning.
I2 terms
Inland Marine
Historically coverage for goods in transit; in personal insurance, refers to scheduled coverage for high-value items like jewelry, art, and instruments - worldwide all-risk coverage.
Insurability Risk Score
A composite rating predicting claim likelihood based on roof age, electrical/plumbing type, HVAC condition, claims history, location, and protective features. Used by underwriters to approve or decline risks.
L2 terms
Law or Ordinance Coverage
Endorsement covering the extra cost of rebuilding to current building code after a covered loss. Also called Increased Cost of Construction (ICC).
Loss of Use
Coverage D. See Additional Living Expense.
M1 terms
Mortgagee Clause
Section of the dec page naming your lender so they are notified of cancellation/non-renewal and are named as a payee on any dwelling claim check.
N4 terms
Named Peril
Policy language that covers ONLY the specific perils listed - fire, lightning, wind, hail, etc. Broader is 'open perils' which covers anything not excluded.
Named Storm Deductible
A variant hurricane deductible triggered by any NHC-named storm, including tropical storms - broader (and worse for you) than a hurricane-only deductible.
NFIP
National Flood Insurance Program - FEMA-run flood insurance. Caps at $250K dwelling / $100K contents. Uses Risk Rating 2.0.
Non-Renewal
The carrier declines to renew your policy at the end of the current term. Florida requires 90-120 days' written notice.
O2 terms
Open Peril
Policy language that covers ANY loss not specifically excluded. The opposite of named peril. Standard on Coverage A in HO-3 and HO-5 forms.
Ordinance or Law
See Law or Ordinance Coverage.
P5 terms
Part 107
FAA certification required for commercial drone pilots. Covers rules for small unmanned aircraft systems including altitude limits, airspace restrictions, and visual line of sight requirements.
Perils
The causes of loss - fire, wind, theft, vandalism, water discharge, etc.
Policy Form
The standardized ISO document that defines the coverage type - HO-3, HO-5, HO-6, HO-8, etc.
Proof of Loss
Sworn statement filed by the insured listing the amount of loss and its circumstances. Most Florida policies require filing within 60 days.
Public Adjuster
Licensed professional hired by the homeowner to represent their interests in a claim, typically for 10-20% of the settlement. Regulated by Florida Statute 626.854.
R6 terms
Reinsurance
Insurance that insurance companies buy from global reinsurers to cover catastrophic loss years. Cost spikes flow through to your premium.
Replacement Cost Value (RCV)
The cost TODAY to replace an item with one of like kind and quality, without subtracting depreciation.
Roof Deck Attachment
How plywood roof sheathing is fastened to trusses. Graded A (staples, worst) through D (8d nails at 6"/6", best) on the wind mitigation form. Higher grades earn bigger premium credits.
Roof Health Index (RHI)
Vcita's proprietary 1-100 scoring system for overall roof condition. Factors: material condition, flashing, penetrations, drainage, thermal anomalies, and remaining useful life.
Roof-to-Wall Connection
The fastening between roof trusses and wall top-plate. Options from weakest to strongest: toe nail, clip, single wrap, double wrap. Strongest types earn the biggest wind mitigation credit.
Roof-to-Wall Connection
The fastening between roof trusses and wall top-plate. Options from weakest to strongest: toe nail, clip, single wrap, double wrap. Strongest types earn the biggest wind mitigation credit.
S6 terms
SB-76
Florida Senate Bill 76 (2021) - mandates carriers cannot refuse coverage solely due to roof age if the roof has at least 25% useful life remaining per a licensed inspector's report.
Scheduled Personal Property
Endorsement that lists specific high-value items (jewelry, art, firearms) with individual limits, worldwide coverage, and no deductible.
Secondary Water Resistance (SWR)
A peel-and-stick membrane installed under shingles to prevent water infiltration if the shingles blow off. Earns a wind mitigation credit.
Secondary Water Resistance (SWR)
A peel-and-stick membrane installed under shingles to prevent water infiltration if the shingles blow off. Earns a wind mitigation credit.
Sinkhole Coverage
Optional endorsement covering ground subsidence damage short of catastrophic collapse. Standard policies only cover 'Catastrophic Ground Cover Collapse.'
Supplemental Claim
A follow-up to an existing open insurance claim when additional damage is discovered after the initial adjuster visit. Does not count as a separate claim on CLUE.
U2 terms
Umbrella Policy
Additional liability coverage ($1M-$5M+) sitting above your home and auto liability. Inexpensive, critical for higher net worth.
Underwriting
The carrier's process of evaluating a risk and deciding whether/how to insure it and at what price.
V1 terms
Verified Property Record (VPR)
A living, inspector-verified property dossier maintained by Vcita that persists across inspections and transactions, containing verified construction details, system ages, photos, and repair history.
W2 terms
WDO Inspection
Wood-Destroying Organism inspection (commonly called termite inspection). Documents evidence of termites, beetles, and wood-decay fungi. Required for FHA/VA loans.
Wind Mitigation Inspection
OIR-B1-1802 form documenting seven construction features that reduce hurricane damage. Required by Florida carriers and unlocks significant premium credits.