Insurance Words, Translated Into Plain English

Insurance paperwork is written in a language nobody speaks at the kitchen table. After Hurricane Ian I sat with letters full of words like "recoverable depreciation" and nodded like I understood them. I didn't, and it cost me. Here is every word you are likely to meet, in plain English first and the official term second. Jump to the group you need.

The money words

The part you pay first: the deductible

Before the insurance money starts, you cover the first slice yourself. If the repair is $20,000 and your deductible is $2,500, the check math starts from $17,500.

The bigger storm version: the hurricane deductible

For named hurricanes, most Florida policies switch to a separate deductible that is a percentage of your Coverage A, usually 2, 5, or 10 percent. On a $400,000 house, a 5 percent hurricane deductible is $20,000, and it is a percent of the house value, not of the damage. Find yours on the declarations page before you need it.

The used-item price: actual cash value (ACV)

What the damaged thing was worth the day before the storm: the price of a new one minus years of wear. A 12-year-old roof has an ACV far below what a new roof costs.

The new-item price: replacement cost value (RCV)

What it actually costs to buy or rebuild new today. Whether your policy pays ACV or RCV is one of the most expensive single lines in it.

The subtraction for age: depreciation

The gap between new price and used value. Insurers apply it item by item: so much off for the roof's age, so much for the carpet's.

The money they keep until you prove the repair: recoverable depreciation, the holdback

Under many RCV policies the insurer first pays the used value, and holds back the depreciation until you show the repairs actually happened: receipts, invoices, sometimes photos. That second check usually does not come on its own. You claim it, on a deadline. This is the single most commonly abandoned money in the process.

The hotel-and-meals money: additional living expenses (ALE)

If the home is unlivable, this pays the extra cost of living somewhere else: hotel, rent, mileage, the difference in food costs. Keep every receipt; it is paid back, not paid up front.

Your policy's parts

The house itself: Coverage A, dwelling

Walls, roof, attached garage, built-in fixtures. The hurricane deductible percentage is a percent of this number.

Everything standing apart from the house: Coverage B, other structures

Fence, shed, detached garage, standalone carport. Often capped at 10 percent of Coverage A, which surprises people with big outbuildings.

Your stuff: Coverage C, personal property

Furniture, clothes, dishes, electronics. Frequently paid at used value (ACV) unless you bought the replacement-cost upgrade.

The one-page summary: the declarations page

The "dec page" at the front of your policy lists your coverages, limits, and deductibles. If you read one page of your policy before hurricane season, read this one, and photograph it for your records.

What the policy refuses: the exclusion

Every policy has a list of things it will not pay for. The one that matters most here: standard homeowners policies exclude flood. Rising water is a separate flood policy; wind-driven rain through a broken roof is the homeowners policy. After a hurricane, which water did the damage becomes the whole argument.

The add-on page: the endorsement, or rider

A page that changes the standard policy, adding coverage (screened enclosures are a classic Florida one) or taking it away. The dec page lists which endorsements you have.

The people

The insurer's employee: the company adjuster

Works for the insurance company, evaluates your damage, writes their estimate. Polite and professional is not the same as on your side.

The insurer's contractor: the independent adjuster

The name misleads. An independent adjuster is a hired contractor working for the insurance company, common after big storms when insurers need extra hands. Independent of the payroll, not of the assignment.

The one who works for you: the public adjuster

A state-licensed professional you can hire to prepare and negotiate your claim, paid a percentage of what the claim recovers. Florida caps their fees and licenses them; verify any license before signing, the same way you would a contractor's.

The process words

The day it happened: the date of loss

The day the storm damaged your home. Every legal clock counts from this date, not from the day you found the damage. The deadlines guide walks through both clocks and calculates your dates.

Officially telling them: the notice of claim

Reporting the damage to your insurer through their official channel, and coming away with a claim number. In Florida this has a hard legal deadline of one year from the date of loss.

The sworn list: the proof of loss

A signed, notarized form itemizing your damage and the amounts you claim. Many policies require it within a set number of days of asking. Miss it and the claim can stall; take it seriously and get help filling it in if you need it.

The itemized damage list: the scope of loss

The line-by-line list of everything damaged and what repairing it costs. When your contractor's scope and the insurer's scope disagree, that gap is the negotiation.

Asking for more later: the supplemental claim

More money requested on a claim you already reported, for damage that turned up later. In Florida it must be filed within 18 months of the date of loss.

The policy's tie-breaker: appraisal

When you and the insurer agree something is covered but disagree on the amount, many policies let either side demand appraisal: you pick an appraiser, they pick one, the two pick an umpire, and the decision sets the amount.

The state's free referee: mediation

Florida's Department of Financial Services runs a free mediation program where a neutral mediator sits you and the insurer down to try to settle. Free to the homeowner; call the DFS helpline at 1-877-693-5236 to ask about it.

Signing your claim away: the assignment of benefits (AOB)

A paper that transfers your claim rights to someone else, usually a contractor at the door. For most current Florida policies it should no longer exist at all; the full story is in the one paper you should not sign in the driveway.

Your duty to stop the bleeding: mitigation

Policies require you to take reasonable steps to keep damage from getting worse: tarp the roof, dry the floors, board the window. The insurer pays reasonable mitigation costs, so keep every receipt, and photograph the damage before the tarp goes on. The first 72 hours checklist puts this in order.

Every one of these words was invented by the industry, not by homeowners. Learning them is not becoming an expert. It is refusing to nod at your own kitchen table.