Actual Cash Value (ACV)
This means you are covered and subsequently reimbursed for the actual cash value (ACV) reimbursement, which is the replacement cost minus the physical depreciation of the lost or damaged property.

Adjuster
A policy that covers all perils except those specifically named. This is also known as special form coverage.

All-Risk Policy
This kind of insurance coverage, which is usually included in a Business Owner's Policy package (BOP), covers expenses incurred if business is suspended due to a disaster-related event such as a tornado. The policy can include coverage for costs such as rent, payroll, and utilities.

Audit
A confirmation of a company's finances that allows an insurance agency to set fair premiums, as well as expose any discrepancies that may be affecting premiums. Your business will undergo yearly audits to determine if your workers' compensation premium is correct.

Business Interruption
This kind of insurance coverage, which is usually included in a Business Owner's Policy package (BOP), covers expenses incurred if business is suspended due to a disaster-related event such as a tornado. The policy can include coverage for costs such as rent, payroll, and utilities.

Business Owner's Package Policy (BOP)
A BOP is a package that bundles property and liability insurance together through one affordable premium. The coverage is relatively broad and meant to appeal to small businesses with 100 or fewer employees.

Claim
A request filed by the insured to the insurance company to be reimbursed for a loss. With workers' compensation, a claim for reimbursement would be filed if an employee is injured on the job.

Claims-Made Insurance
This kind of policy provides coverage only if a claim is made during the policy period. If the policy has a retroactive date, a loss that occurred before that date is not covered.

Commercial General Liability Insurance
A basic liability policy that covers four forms of injury: bodily injury or property damage that results in actual physical damage or loss, personal injury, and advertising injury. Most companies will need to supplement their CGL with automobile insurance and workers compensation.

Coverage
The extent of what your insurance policy will cover in case of any accident or need for reimbursement.

Deductible
The amount the insured must pay towards a claim before receiving any policy benefits. Deductibles can be calculated on a per-claim or aggregate basis.

Employee Liability Coverage
Often included as part of a workers' compensation insurance policy. It is meant to protect an employer if an employee files a lawsuit because of an injury or sickness incurred while on the job.

Experience Modification Factor
The experience modification factor is just one of the many ratings and factors that go into the calculation of your workers' comp premiums. This rating is based on your entire history of claims. When purchasing insurance for the first time, this rating won't be considered (simply because you don't have a history of claims at this point).

Experience Rating
An indication of your history of claims. Experience ratings better or worse than average will affect a firm's premiums.

Exposure Base
A measure of the size of a firm. The exposure base may be measured in terms of payroll, gross sales, or square footage.

Extended Reporting Period (ERP)
The extended reporting period (ERP) or tail end coverage is coverage for claims that result from incidents that took place while the policy was in effect but were reported after the policy expired.

Grace Period
The amount of time granted to a policy holder to adjust a policy to reflect the value of newly-purchased assets.

Named-Perils Policy
A policy that covers losses resulting from only those perils that are named in the insurance policy.

NCCI
National Council on Compensation Insurance. A bureau that calculates rates for workers' compensation insurance premiums. They use over 600 industry classifications to calculate these rates.

Perils
These are events, caused by either weather or humans, that do damage, often resulting in a loss for a business. Lightning strikes and robberies, for example, are considered perils.

Policy
The plan you receive for your business through your insurance agency. It's a legal document that details all the terms and conditions of your insurance coverage.

Premium
The amount of money a firm must pay to obtain insurance coverage.

Property Insurance
This protects your business against any physical damage to or loss of your assets in the case of catastrophes such as fire, theft, or vandalism.

Replacement-Cost Basis
This means you are covered and subsequently reimbursed for the actual cost of replacing your property.

Retroactive Date
This date on a claims-made policy states when coverage begins. Any claim made during the policy period on a loss that occurred before this retroactive date will not be covered.

Umbrella Insurance
An excess liability policy, providing additional coverage above and beyond that offered by primary policies.

Workers' Compensation Insurance
Insurance held by companies to reimburse employees that get sick or injured on the job. Workers' compensation is a state-mandated program.