SC Property & Casualty key terms

A financial stake in the person or property being insured such that the insured would suffer a genuine economic loss if a covered event occurred. For property insurance it must exist at the time of loss.

The principle that insurance should restore an insured to roughly the same financial position held before a loss, no better and no worse. It limits recovery to the actual amount of the loss.

The mutual duty of insurer and applicant to deal honestly and to disclose all material facts. Concealment or misrepresentation of important information can allow the insurer to void coverage.

The insurer's right, after paying a claim, to step into the insured's shoes and pursue the party that caused the loss. It helps hold wrongdoers accountable and control premium costs.

A valuation method that pays the cost to replace damaged property minus depreciation, reflecting the property's used value at the time of loss. It is the default basis in many property forms.

A valuation method that pays what it costs today to repair or rebuild with new materials of like kind and quality, without deducting depreciation. Payment is usually capped at the policy limit.

Failure to exercise the degree of care a reasonable person would use in similar circumstances, resulting in unintended harm. It is the foundation of most liability claims and requires duty, breach, causation, and damages.

A liability policy that covers injury or damage that takes place during the policy period, regardless of when the claim is reported. It provides long-tail protection for latent harm.

A liability policy that covers claims first reported during the policy period, provided the wrongful act happened on or after the retroactive date. Reporting deadlines matter greatly.

A person or organization added to another's liability policy and granted protection for claims arising from the named insured's work or premises. They typically receive no broader coverage than the named insured.

The special-form homeowners policy that covers the dwelling and other structures on an open-peril basis while personal property is covered for listed perils. It is the most widely sold homeowners form.

The tenants form of homeowners insurance. It insures personal property against listed perils and provides liability and medical payments coverage, but it does not cover the rented building itself.

The homeowners or dwelling policy section that insures the residential structure, including attached additions and built-in fixtures, for the amount shown on the declarations.

Pays the extra cost of temporary housing and normal living expenses when a covered loss makes the residence uninhabitable, up to the stated limit and time period.

Provides defense and pays damages when the insured is legally responsible for bodily injury or property damage to others, up to the policy limit, typically on an occurrence basis.

Pays reasonable medical expenses for guests or others injured on the insured premises or by the insured's activities, regardless of fault, subject to a small limit.

A property form for rented or owner-occupied dwellings that are not eligible for homeowners coverage. It offers named-peril or broad-form protection plus limited liability options.

Pays the extra cost to rebuild to current building codes, including demolition and undamaged portions, after a covered loss. It responds when repair is required to meet newer regulations.

Replaces lost net income and continuing operating expenses while a business is shut down by a covered property loss, usually during a defined period of restoration.

A property provision requiring the insured to carry insurance equal to a stated percentage of the property's value or face a reduced claim payment. It penalizes underinsurance.

A packaged policy for small and medium businesses that combines commercial property, general liability, and often business income coverage in one contract at a competitive price.

The standard auto form used by individuals and families. It covers liability, medical payments, uninsured motorists, and physical damage for personal vehicles listed on the declarations.

Auto liability limits expressed as three numbers, such as 25/50/25, showing the maximum paid per person, per accident for bodily injury, and per accident for property damage.

A single dollar amount that caps total liability payments for all bodily injury and property damage arising from one accident, without separate per-person or per-category caps.

Pays the insured for bodily injury caused by a driver who has no liability insurance, or by a hit-and-run driver, up to the limits purchased. Some states also require underinsured coverage.

Auto coverage that pays reasonable medical and funeral expenses for the insured and passengers after an accident, regardless of who caused it, up to the stated limit.

A policy endorsement that removes a specific driver from coverage. The insurer may then deny claims arising while that excluded person is operating the insured vehicle.

The commercial auto form that insures liability and physical damage for vehicles a business owns, hires, or borrows, with coverage determined by selected symbols on the declarations.

Liability coverage for autos a business rents or borrows and for employee-owned vehicles used in company business. It fills gaps left when no owned-auto coverage applies.

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

CGL coverage for injury or damage caused by the insured's product or completed work after it has left the insured's control. It excludes the insured's own defective product.

CGL coverage for offenses such as libel, slander, wrongful eviction, and infringement of advertising ideas, as distinguished from bodily injury or property damage.

The most a liability policy will pay for all covered claims during a policy period, in addition to any per-occurrence limit. Once exhausted, no further coverage applies.

The principle that workers' compensation benefits are the employee's sole legal recovery against the employer for a work-related injury, barring most negligence lawsuits in exchange for no-fault benefits.

A rating number that compares a business's past workers' compensation losses with those of similar employers. A factor above 1.00 raises premium; below 1.00 reduces it.

Excess liability coverage that sits above underlying auto, general liability, and employers liability policies, and may also drop down to cover some gaps.

Property coverage for goods in transit, movable equipment, and property away from a fixed location, filling gaps left by standard commercial property forms.

A license issued by the South Carolina Department of Insurance that authorizes an insurer to transact specified lines of insurance business in the state.

A prohibited insurance sales or claims practice, such as misrepresentation, rebating, or bad-faith claim handling, that can lead to fines, license suspension, or revocation in South Carolina.

South Carolina's residual market program that provides wind and hail coverage for coastal property owners who cannot obtain it from the voluntary market.