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Insurance Glossary - A



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Absolute Liability: The legal concept, which states that a third party, will not be prejudiced by the actions of the insured. This concept provides direct right of action against an insurance company to a third party so they may collect money owed to them even if an insured violated the terms of a policy.

Abandonment: The voluntary relinquishment of rights and responsibilities in the property covered by the insurance contract. This is forbidden in most insurance contracts.

Accident Benefits: A compulsory coverage in all provinces except Newfoundland and Quebec, it pays defined amounts to an injured insured on a no-fault basis. Examples of coverage are rehabilitation expenses, death benefits and loss of income benefits.

Act of God: A sudden and violent act of nature that could not have been foreseen or prevented.

Actual Cash Value (ACV): The current cost of replacing an article with a similar one in the same condition and exposed to the same wear and tear. ACV is calculated by establishing the current replacement cost of any item and charging depreciation.

Actual Owner: The person who actually paid for an automobile.

Adjuster: A representative of an insurance company who works along with the insured to investigate, negotiate and settle an insurance claim.

Agent: An independent person or firm authorized by contract to write business with a number of insurance companies, to provide coverage in accordance with the agreement and to collect premium on the insurance company’s behalf.

All Perils: A type of coverage found under Section C of an automobile policy. It is the broadest type of coverage that may be purchased and covers both Collision and Comprehensive losses. The coverage is limited by exclusions listed on the policy.

All Risks: A type of policy used to insure a variety of things such as homes and boats. It covers all perils except for the exclusions listed on the policy.

Appraiser: A competent person enlisted by an insurance company to value a specific piece of property.

 
 
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