Florida insurance glossary

ACV pays depreciated value at time of loss. RCV pays the cost to repair or replace with new materials, typically with depreciation held back until repairs are completed.

Coverage that reimburses the reasonable additional costs of living elsewhere while your home is uninhabitable due to a covered loss.

The all other perils deductible is the flat dollar amount you pay out of pocket on a claim caused by anything other than a hurricane or named storm, such as a kitchen fire or a burst pipe.

An anti-concurrent-causation clause directs the insurer to deny an entire loss when a covered peril and an excluded peril combine to cause the damage, no matter the order in which they occurred.

The written decision of an appraisal panel resolving a dispute over amount of loss: generally binding on both parties.

A policy provision allowing either party to demand a three-party appraisal when the policyholder and the carrier disagree on the amount of loss.

The neutral third decision-maker in an appraisal process: selected by the two appraisers (or by a court) to decide amount-of-loss when the appraisers cannot agree.

An agreement transferring a policyholder's post-loss insurance benefits to a third party such as a contractor, now barred for Florida property policies issued on or after January 1, 2023 and tightly regulated for policies issued between July 1, 2019 and before that date.

A carrier's unreasonable failure to settle a claim that should be paid: supporting a statutory cause of action under Fla. Stat. 624.155.

Betterment is the increase in value or useful life a repair gives property beyond its pre-loss condition, which a carrier may try to deduct so it is not paying to make the property better than it was before the loss.

Blanket coverage insures a group of items or structures under one shared limit, while scheduled coverage insures specific listed items individually for stated values.

A time period after a covered loss begins during which business-interruption coverage does not yet apply: typically 72 hours.

A catastrophe (CAT) adjuster is an insurance adjuster, usually an independent contractor hired by your insurance company, who is deployed after a hurricane or other large-scale disaster to inspect and process a high volume of property claims quickly.

The cause of loss is the peril or event that produced the damage, and identifying it is the threshold question that decides whether a policy covers the claim.

The statutory ceiling in Fla. Stat. 627.351 on how much Citizens Property Insurance can raise the rate on a single policy each year, phasing up from 12 percent in 2023 to 15 percent in 2026 and beyond.

A business-interruption extension that pays for losses caused by civil authority action that prohibits access to the insured premises: typically for a limited time.

A Civil Remedy Notice (CRN) is the filing under Fla. Stat. 624.155 that gives a Florida insurer 60 days to cure a violation before a first-party bad-faith claim can proceed.

A policy condition penalizing underinsurance: typically requiring the insured to carry at least 80% of replacement cost.

A standard policy condition that voids coverage when an insured intentionally conceals or misrepresents a material fact, whether in the application or in the claim.

A policy requirement the insured must satisfy before the carrier owes performance: e.g., prompt notice or sworn proof of loss.

A loss where the structure is not literally destroyed but is treated as a total loss because repairing it costs as much as, or more than, replacing it, or repair is not practical.

A policy endorsement that limits or excludes coverage for hurricane or hail damage the insurer deems purely cosmetic, meaning it changes a surface's appearance without affecting its function.

Coverage A is the part of a homeowner policy that pays to repair or rebuild the physical structure of your house, including attached components like the roof, walls, and built-in systems.

Coverage B pays for damage to structures on your property that are not attached to the house, such as a detached garage, shed, fence, or pool enclosure.

Coverage C pays to repair or replace your personal belongings, such as furniture, clothing, electronics, and appliances, when they are damaged or destroyed by a covered peril.

Coverage D reimburses the extra living costs you incur when a covered loss makes your home uninhabitable, such as temporary rent, hotel bills, and increased meal expenses.

The front page of a property policy summarizing named insureds, coverage limits, deductibles, and endorsements.

The Fla. Stat. 627.351 program that moves policies out of Citizens Property Insurance and back to private carriers, where a take-out offer within 20 percent of your Citizens premium generally makes you ineligible to stay with Citizens.

The reduction in value from age, wear, and obsolescence: subtracted from Replacement Cost to yield Actual Cash Value.

A policyholder-signed authorization directing the carrier to pay a contractor directly without assigning underlying claim rights. Distinct from AOB and the Florida limitations on it.

The policy conditions a policyholder must meet after a loss - giving prompt notice, protecting the property from further damage, documenting and inventorying the damage, submitting a proof of loss, and cooperating with the insurer - before the carrier is obligated to pay.

Efficient proximate cause is the rule that looks to the single predominant peril that set a chain of events in motion to decide whether a loss is covered.

A policy document that modifies the base policy by adding, removing, or changing coverage. Endorsements control coverage on Florida claims as much as the base form does, sometimes more.

An ensuing loss provision restores coverage for separate, covered damage that follows an excluded event, such as water damage that results from otherwise-excluded faulty work.

A formal, recorded, sworn question-and-answer session in which the policyholder answers the insurer's questions about a claim under oath.

A policy provision removing specific causes of loss, property, or circumstances from coverage. Florida exclusion language is heavily litigated; how it's read decides many denied claims.

A claim you file with your own insurance company for your own loss, as opposed to a third-party claim brought against someone else's insurer for damage they caused.

The flood exclusion in a standard property policy removes coverage for damage caused by flooding, including storm surge, so flood losses generally must be covered by separate flood insurance.

A state-run reinsurance fund that reimburses Florida property insurers for a share of their catastrophic hurricane losses, helping carriers stay solvent and keeping some reinsurance capacity in the market.

The statutory entity that takes over covered Florida property claims when a carrier becomes insolvent. FIGA pays claims subject to a $300,000 cap and other policy-specific limits.

Florida law requires insurers to replace or repair damaged items with materials of like kind and quality when matching items are not reasonably available.

The High-Velocity Hurricane Zone is the region of Florida, made up of Miami-Dade and Broward counties, where the Florida Building Code imposes the state's strictest wind-design and product-approval requirements.

A separate, usually higher deductible that applies to damage caused by a hurricane: typically calculated as a percentage of the dwelling coverage, not a flat dollar amount.

An inflation guard endorsement automatically increases your dwelling and related coverage limits by a set amount over time so your coverage keeps pace with rising rebuilding costs.

Insurance coverage that pays for the additional cost of bringing a damaged structure up to current building code when repairs are made.

A line-item estimate breaks a repair into individual tasks, each with its own quantity, unit price, and total, instead of a single lump-sum figure, so every component of the claim can be inspected and priced separately.

The policy provision specifying how a claim will be valued: ACV, RCV, functional replacement, or other basis.

A carrier program in which the insurer arranges and oversees repairs through its own network of contractors instead of paying the policyholder cash to hire their own.

Market value is what a property would sell for, including land and location, while replacement cost is what it costs to rebuild the structure with new materials, and property claims are paid on replacement cost, not market value.

The policy and statutory obligation to repair damaged items so that repairs match adjoining undamaged items.

The insured's policy duty to take reasonable steps to protect property from further damage after a loss. Failure to mitigate is a frequent Florida carrier defense; reasonable mitigation costs are reimbursable.

A mold coverage limitation caps or restricts how much a property policy will pay for mold or fungi remediation, and usually covers mold only when it results from a covered water loss.

A coverage form that pays only for causes of loss specifically listed in the policy, contrasted with open-peril (all-risk) coverage. Most Florida personal-property forms are named-perils.

A deductible that applies when a named storm (tropical storm, subtropical storm, or hurricane) causes damage: broader than a hurricane-only deductible.

The carrier's decision not to offer a new policy at the end of the current term, distinct from cancellation mid-term. Florida law requires advance notice and limits the grounds carriers can use.

The former Florida rule that made an insurer pay a policyholder's attorney fees whenever the policyholder won any recovery in a coverage suit, carved back for property insurance by SB 2-A (2022) and eliminated entirely by HB 837 (2023).

A coverage form covering any cause of loss that is not specifically excluded by the policy. The carrier bears the burden of proving an exclusion applies; on Florida HO-3 forms, dwelling coverage is typically open-peril.

Overhead and profit, often called general contractor overhead and profit, is the markup a general contractor charges to coordinate multiple trades on a repair, commonly written as 10 percent for overhead and 10 percent for profit.

The time during which business-interruption coverage applies: from the end of the waiting period until the business is (or reasonably should be) restored.

The maximum amount the carrier will pay under each coverage part: dwelling, other structures, personal property, loss of use, and liability. Florida limits also include sublimits and per-claim caps that apply before the main limit.

A written notice of intent to initiate litigation that a Florida property policyholder must file with the Department of Financial Services at least 10 business days before suing the insurer, as a condition precedent under Fla. Stat. 627.70152.

A sworn, notarized statement from the policyholder detailing the loss, the amount claimed, and the circumstances: typically required by policy.

A Florida civil-litigation tool under Fla. Stat. 768.79 and Rule 1.442 that shifts attorney fees to the party who rejects a settlement offer and then does at least 25 percent worse at judgment.

A Florida-licensed professional (3-20 license) retained by and accountable to the insured to handle a property insurance claim.

The $2 billion state reinsurance layer created by Florida's CS/SB 2-D in May 2022 to sit below the Florida Hurricane Catastrophe Fund and, in theory, help hold down homeowner premiums.

Reasonable and customary pricing is the going rate for materials and labor in a specific geographic area at the time of loss, which insurers use as the benchmark for what a repair should cost.

Recoverable depreciation is the held-back portion of a replacement cost claim the insurer pays once repairs are completed, while non-recoverable depreciation is a deduction you never get back.

The difference between ACV and RCV that the carrier initially withholds from a claim payment, releasing it only after repairs are completed and documented.

A letter from the carrier stating that the carrier is investigating or handling the claim but reserves the right to later deny coverage if specific conditions are found.

A policy provision that caps what an insurer will pay for a roof-surface loss at a percentage of replacement cost tied to the roof's age and material, rather than paying full replacement cost.

A sublimit is a smaller coverage cap that applies to a specific category of loss inside a larger coverage part, limiting what the policy pays for that category even when the overall limit is far higher.

The insurer's right, after paying a claim, to step into the policyholder's position and recover what it paid from the party that actually caused the loss.

Policy language that distinguishes sudden water or other damage (typically covered) from gradual or long-term damage (typically excluded).

A policy condition setting a deadline by which any lawsuit against the insurer must be filed, separate from and often shorter than the general statutory time limit.

A claim for additional amounts on a Florida loss previously reported, distinct from a reopened claim. Florida Statute 627.70132 sets a hard reporting deadline that controls eligibility.

A non-admitted insurance company allowed to write Florida coverage that licensed carriers will not, but which is not backed by the Florida Insurance Guaranty Association if it becomes insolvent.

An undisputed payment is the portion of your claim the insurance company agrees it owes and pays you, even while the rest of the claim is still being contested.

Unit-cost pricing sets a repair's cost by multiplying a measured quantity by a standardized price per unit, such as per square foot or per linear foot, rather than quoting a single lump sum.

A table insurers use to calculate actual cash value by assigning each building component an expected lifespan and depreciating it based on its age relative to that lifespan.

Florida's valued policy law requires an insurer to pay the face amount stated in the policy when a covered structure is a total loss, instead of relitigating the property's actual value.

A provision in a policy or contract by which one party gives up its insurer's right to pursue the other party for a loss, common in leases, construction contracts, and condominium documents.

A water damage sublimit is a policy provision that caps how much the insurer will pay for certain water losses at an amount lower than the overall policy limit.

The wear and tear exclusion removes coverage for gradual deterioration, aging, and normal use, separating those slow losses from the sudden, accidental damage a policy is meant to cover.

Florida premium discounts awarded to homeowners who document qualifying wind-resistant construction features: hip roof, secondary water resistance, impact-rated windows, etc.

The industry-standard claim estimating software used by virtually every Florida carrier and most public adjusters. Pricing data, scope notes, and depreciation tables drive what the carrier offers.