MI Property & Casualty key terms

A license from Michigan's insurance regulator (DIFS) permitting an insurer to transact insurance in the state; selling insurance without one is illegal.

A state-issued credential allowing a person to solicit, negotiate, or sell insurance; Michigan requires prelicensing education, a passing exam score, and periodic renewal.

A producer's obligation to hold money belonging to clients or insurers in trust and account for it accurately; mixing premiums with personal funds is prohibited.

A deceptive or anti-competitive act in selling insurance or handling claims, such as misrepresentation, rebating, or bad-faith settlement, that state law forbids and penalizes.

A financial stake in the insured person or property such that a loss causes real economic harm; property insurance requires it when the policy begins.

The core idea that insurance should restore an insured to roughly the same financial position held before a loss, no better and no worse.

The high honesty standard owed by both applicant and insurer, requiring disclosure of material facts; concealment or misstatement can undo the policy.

A false statement about a fact that would have changed the insurer's decision to issue coverage or the price charged, allowing rescission or denial of a claim.

A promise or condition in the policy that the insured must satisfy; a breach can defeat a claim even when the breach did not cause the loss.

The insurer's right, after paying a loss, to stand in the insured's place and seek recovery from the party who caused the damage.

A loss settlement method that pays the cost to replace damaged property minus depreciation, reflecting what the item was worth just before the loss.

A loss settlement method paying today's price to repair or replace damaged property with similar new property, with no deduction for depreciation.

A property condition requiring the insured to carry limits equal to a stated percentage of the property's value or have claims reduced by a penalty calculation.

A provision protecting a lender's interest in insured property by giving the lender loss payments, notice of cancellation, and the right to pay premiums.

Conduct that falls short of the care a reasonable person would use in similar circumstances and that causes unintended injury or damage to another.

An accident, including repeated exposure to the same harmful conditions, that produces bodily injury or property damage during the policy period.

Liability coverage for non-bodily offenses such as libel, slander, invasion of privacy, and wrongful eviction, as distinguished from bodily injury.

A residential property form for one-to-four-family dwellings not occupied by the owner, offering fire and extended coverage with optional theft, liability, and other endorsements.

Coverage that repays the insured for rental income lost when covered damage makes a rented dwelling unit unfit to live in.

The most widely used homeowners form; it covers the dwelling and other structures for risks of direct physical loss and personal property for named perils.

Homeowners coverage that pays additional living expenses, plus lost rental income, when covered damage makes the residence temporarily uninhabitable.

Coverage for the extra expense of repairing or rebuilding in compliance with current building codes, including demolition of undamaged parts the code requires.

A standardized auto form covering private passenger vehicles, with liability, medical payments or no-fault benefits, uninsured motorist, and physical damage coverages.

Michigan no-fault coverage that pays medical bills, lost wages, and replacement services for the insured and passengers no matter who caused the crash.

Michigan no-fault coverage that pays for damage the insured's vehicle causes to other people's property, such as parked cars or buildings, regardless of fault.

A Michigan rule allowing an injured driver to collect a limited amount of unreimbursed vehicle damage from the at-fault driver's liability coverage.

Coverage that pays the insured's damages when the at-fault driver has no liability insurance or carries limits too low to cover the injuries.

Physical damage coverage for the insured vehicle when it strikes another object or overturns, paid regardless of fault and subject to a deductible.

A commercial liability form covering bodily injury, property damage, and personal and advertising injury arising from the insured's premises, operations, products, or completed work.

A commercial property form insuring buildings, business personal property, and property of others at described locations against listed causes of loss.

Commercial coverage replacing lost net income and continuing normal expenses, such as payroll and rent, while a covered loss shuts down operations.

A package policy for eligible small businesses that combines commercial property, business income, and general liability in one contract, often at lower cost.

Statutory coverage paying medical care and wage replacement to employees hurt on the job, regardless of fault, while shielding the employer from most injury lawsuits.

The rule that workers' compensation benefits are an injured employee's sole remedy against the employer, blocking most negligence suits over workplace injuries.

A workers' compensation rating factor comparing an employer's past losses with similar businesses; better loss experience lowers the premium, worse experience raises it.

A Michigan entity that reimburses auto insurers for no-fault medical costs above a set threshold, funded by annual assessments on insured vehicles.

A Michigan program that provides no-fault benefits to injured people who cannot obtain coverage from any policy on the vehicle or in their household.

A statutory Michigan entity that pays covered claims of insolvent property and casualty insurers up to set limits, protecting policyholders and injured claimants.

Coverage for water damage from rising water, mudflow, or storm surge, normally excluded by homeowners and commercial property forms and purchased separately, often through the NFIP.