A document that outlines any agreed changes or additions to an existing insurance contract. It is used to formally amend the original terms of the policy, such as adjusting the cover limits, adding new insured items, or updating conditions and exclusions. The addendum becomes a legally binding part of the insurance contract and must be reviewed carefully to ensure all changes are understood and agreed upon by both the insurer and the policyholder.

All Risks insurance offers broad protection for insured items against loss or damage from a variety of unexpected events, whether at home, work, or while traveling. However, this does not mean every possible scenario is covered; exclusions and limits will be specified in the policy terms. It is important for policyholders to understand these conditions to avoid unexpected gaps in cover.

A clause in insurance policies whereby, in the event of under-insurance, the claim paid out by the insurer is restricted to the same proportion of the loss as the sum insured under the policy bears to the total value of the insured item.

A broker is a professional who acts as a middleman between you and insurance companies. Their job is to help you find the right insurance cover based on your specific needs. Instead of just offering policies from one insurer, a broker has access to multiple providers, which allows them to compare options and find the best deal for you.

Brokers work for you, not the insurance companies, which means they offer unbiased advice and support throughout the process—from choosing the right policy to helping you with claims if something goes wrong. They are experts in understanding different insurance products and can explain any jargon in plain English, ensuring you have the cover that suits you best.

Common law consists of the ancient customs and usages of the land, which have been recognised by the courts and given the force of law. It is in itself a complex system of law, both civil and criminal, although it is greatly modified and extended by statute law and equity. It is unwritten and has come down in the recorded judgements of judges who, for hundreds of years, have interpreted it.

A temporary insurance document provided by the insurer or broker to the insured. This document confirms the details of the cover in place before the actual policy documents are issued to the insured. In the case of motor insurance, it also serves as a temporary certificate.

An insurance policy endorsement is an amendment that modifies or adds specific terms, conditions, or cover to an existing insurance policy. Endorsements are typically noted within the policy schedule.

Fronting is a form of car insurance fraud in which a more experienced driver falsely claims to be the main driver to secure a lower premium. This practice is illegal and can have serious consequences, including policy cancellation, fines, increased premiums, and even prosecution for insurance fraud.

Employers’ liability insurance is a legal requirement for most businesses in the UK that have employees. It provides cover if an employee is injured or becomes ill as a result of their work and seeks compensation from the employer. This insurance helps to cover the cost of compensation payments, legal fees, and any medical costs associated with the claim.

For example, if an employee suffers an injury while using equipment at work or develops a health issue due to workplace conditions, employers’ liability insurance protects the business from having to pay these costs out of pocket. It is designed to ensure that employees can receive proper compensation while safeguarding the financial stability of the business.

Excess is the amount of money you agree to pay towards a claim before your insurance company contributes. For example, if your excess is £250 and you make a claim for £1,000, you will pay the first £250, and your insurer will cover the remaining £750.

There are usually two types of excess: compulsory excess, which is set by the insurer, and voluntary excess, which is an amount you can choose to add on top. Choosing a higher voluntary excess can lower your insurance premium, but it means you’ll have to pay more if you make a claim.

Excess helps to reduce the number of small claims and ensures that people are mindful when making claims.

The Financial Ombudsman Service is an independent organisation in the UK that helps settle disputes between consumers and financial companies, such as banks, insurers, or lenders. If you have a complaint about a financial product or service, and you’re unable to resolve it directly with the company, the Financial Ombudsman can step in to review the issue and make a fair decision.

Their role is to investigate complaints impartially and, if they find that the financial company has acted unfairly, they can order the company to put things right—this might include compensation or other remedies. The service is free for consumers, and it’s designed to ensure that people are treated fairly when things go wrong with financial products.

Fully Comprehensive insurance offers the highest level of motor insurance cover available, protecting you against damage caused to other vehicles, property, or persons, as well as damage to your own vehicle from accidents, fire, theft, or vandalism. While it provides extensive protection, it’s important to review the policy terms as some exclusions or limits may apply, such as for certain types of damage or personal belongings inside the vehicle.

Indemnity is a fundamental insurance principle where the insurer aims to restore the policyholder to the same financial position they were in before a loss occurred. This means providing compensation for the damage or loss suffered without allowing the insured to profit from the claim. For example, if your insured property is damaged, indemnity ensures the repair costs are covered to restore the property to its prior condition, rather than exceeding its value.

An indemnity limit is the maximum amount of money your insurance company will pay out for a claim under your policy. It sets the upper boundary on how much compensation you can receive for losses or damages. If the cost of the claim exceeds the indemnity limit, you would need to cover the remaining costs yourself.

Choosing the right indemnity limit is important to ensure you are adequately protected in case of significant claims.

Under a business interruption insurance policy, the indemnity period refers to the duration for which cover is provided for the disruption to the business operations following the occurrence of an insured peril. This period starts from the date of the insured event and continues until the business operations are restored to the condition they were in before the disruption, subject to the maximum period specified in the policy.

Insurance Premium Tax (IPT) is a tax applied to most general insurance premiums in the UK, including car, home, and travel insurance policies. The standard rate of IPT is currently set at 12%. However, certain types of insurance, such as travel insurance and policies covering some electronic devices, are subject to a higher rate of 20%. Although insurers are responsible for paying this tax, it is typically passed on to policyholders and included in the overall premium cost.

An insured peril is a specific event or risk that is covered by your insurance policy. If an insured peril occurs and causes damage or loss, your insurance company will compensate you according to the terms of your policy. Common insured perils include events like fire, theft, flooding, or storm damage.

Insurers commonly use independent qualified loss adjusters for detailed investigations of complex and significant losses. These adjusters, while paid by insurers, remain impartial. They base settlement judgements on market practices, aiming for a fair resolution under the policy’s terms for both insured and insurer. If specialised knowledge is needed, the adjuster will seek expert advice.

Any information that could affect the insurance company’s decision to accept or decline a risk, or to determine the cost and terms of the policy, is considered important and must be disclosed by the person applying for insurance (or by the insurance company to the policyholder). This is done to make sure that the insurance company can properly evaluate the level of risk and offer the right cover.

A Mid Term Adjustment (MTA) is a change made to your insurance policy during its active period, before the renewal date. This can happen when your circumstances change, and you need your policy to reflect that. For example, in car insurance, an MTA might occur if you change your vehicle or address, and in business insurance, it could be if you hire more staff or move to a new location.

Making an MTA can affect your premium, meaning your insurance costs might go up or down depending on the adjustment. Some insurers may also charge a small fee for processing the change. It’s important to notify your insurer of any changes that could impact your cover.

Negligence refers to the failure to take proper care or act responsibly, resulting in harm or damage to someone else. In an insurance context, negligence typically means that a person or business did not take reasonable steps to prevent an accident, injury, or damage, and this failure led to a claim.

A No Claims Bonus (NCB) is a discount on the insurance premium offered by an insurer to the policyholder. This bonus is awarded when the insured has not made any claims during the previous policy period. It is a common feature in motor insurance policies, incentivising safe driving and claim-free records by reducing the cost of insurance in subsequent years.

Non-disclosure refers to the failure to inform the insurer about a material fact that could influence the terms of the insurance policy. If a policyholder fails to disclose such information, it may result in the insurer refusing to pay a claim, cancelling the policy, or even taking legal action. It is crucial for applicants to provide complete and accurate information during the application process.

A policyholder is the person or business whose name is on the insurance policy. They are the one who owns the insurance cover and is responsible for paying the premium. The policyholder has the legal right to make changes to the policy, renew it, or cancel it.

If something happens that is covered by the policy, the policyholder is the one who can make a claim and receive any payouts from the insurer. For example, if you take out car insurance, you are the policyholder, and it’s your responsibility to ensure that the policy is up to date and that you meet its terms.

This document serves as valid proof of insurance cover where legally required. It is particularly critical for activities mandated by law to have insurance, such as operating motor vehicles or employing staff. Keeping this certificate up-to-date and readily available is essential to avoid legal and financial consequences during insurance audits or in the event of a claim.

This document forms an integral part of the insurance contract. It details the period of insurance, specifies the applicable sections of the policy, and provides information on any relevant excesses and endorsements. Therefore, it is essential for policyholders to review their schedule carefully to ensure understanding and compliance with all terms and conditions of cover.

Products liability insurance covers a business if one of the products it sells, supplies, or manufactures causes harm, injury, or damage to a customer or their property. This type of insurance protects your business by covering the cost of compensation claims, legal fees, and any damages awarded.

Public liability insurance provides cover if your business is held legally responsible for injury to a member of the public or damage to their property as a result of your business activities. For example, if a customer slips and falls in your shop, or if you accidentally damage someone’s property while working at their premises, public liability insurance can help cover the cost of compensation claims, legal fees, and any damages awarded.

This type of insurance is essential for businesses that interact with the public, as it protects you from potentially large financial losses due to accidents or unforeseen incidents.

In a claims-made insurance policy (such as professional indemnity or certain liability covers), the retroactive date is the earliest point in time from which incidents can be covered—provided the claim is made during the active policy period. Any event that occurred before this date will typically not be covered, even if the policy is in force when the claim is made. It protects insurers from liabilities arising from historical risks that were not underwritten.

This type of insurance is essential for businesses that interact with the public, as it protects you from potentially large financial losses due to accidents or unforeseen incidents.

A statement of fact records information provided to the insurer by the proposer, which has been relied upon to offer a quotation, including its price and terms. It is used instead of a proposal form, which serves a similar purpose.

The maximum amount your insurer will pay out in the event of a covered claim, as specified in your associated insurance policy. This amount represents the limit of the financial protection under your contract, covering the cost(s) of loss or damage up to an agreed sum. It is crucial to ensure this amount accurately reflects the value of the property or item covered to avoid being underinsured.

A third party is anyone who makes a claim against an insured person. The first party is the insurer, and the second party is the policyholder. For example, in an accident, the person injured becomes the “third party” claiming against your insurance. Third-party insurance covers these claims and is legally required for motor vehicles.

Third-party insurance is the most basic level of motor insurance required by law in the UK. It covers you for any damage or injury you cause to other people, their vehicles, or their property while driving. However, it does not provide any cover for damage to your own vehicle or injuries you may suffer in an accident.

An underwriter is the professional responsible for carrying out the underwriting process. They analyse the risk involved and decide on the terms of your insurance policy, including the cost and any specific conditions or exclusions. Underwriters play a key role in ensuring the insurance company offers policies that are fair but also protect the insurer from large, unexpected losses.

Underwriting is the process that insurance companies use to assess the risk of insuring a person, property, or business. When you apply for insurance, the company looks at various factors—such as your age, health, driving record, or type of business—to determine how likely you are to make a claim. Based on this assessment, they decide whether to offer you cover and at what premium.

The principle of utmost good faith mandates that both the insurer and the insured act in complete honesty with each other. This requires full disclosure of all material facts relevant to the policy, namely, any information that could affect the insurer’s decision to provide cover or the terms offered. If the proposer – the individual seeking insurance – fails to disclose these facts, it can result in the insurer cancelling the policy and denying claims. This could potentially leave the proposer without cover when it’s needed.

This refers to the gradual deterioration of an item that occurs naturally over time due to normal use and ageing. In the insurance context, particularly within general insurance, wear and tear is often excluded from policy cover. This is because insurance policies are designed to cover sudden and unforeseen events, rather than gradual degradation or the expected decline in an item’s condition through regular use.