Actual Cash Value (ACV)
Replacement cost minus depreciation; what insurers pay when you don’t have replacement-cost coverage.
Glossary
The claim & adjuster glossary.
Plain-English definitions for the vocabulary of insurance claims and public adjusting — Actual Cash Value, Replacement Cost, Coverage A/B/C/D, Proof of Loss, and more. Built for the policyholders we represent in New Jersey, Pennsylvania, and Colorado.
Serving NJ · PA · CO
20+ claim terms
Plain-English definitions.
Every term below — alphabetized for quick reference — describes the language of an insurance claim. Pairs naturally with our FAQ, pricing & fees, and the per-loss claim pages.
Replacement Cost
The current price to replace or rebuild a damaged item with a comparable new one; no depreciation deduction.
Additional Living Expense (ALE) / Loss of Use (LOU)
Coverage that pays extra housing and living costs when the home is unlivable during repairs.
Dwelling Coverage (Coverage A)
The part of your policy that covers the structure of the home itself — roof, walls, foundation, built-ins.
Coverage B — Other Structures
Detached structures on the property: fences, sheds, detached garages, separate structures.
Coverage C — Personal Property (Contents)
Your belongings — furniture, clothing, electronics, contents stored on or off premises.
Coverage D — Loss of Use
Coverage that pays extra living expenses while the home is unlivable; pairs with ALE/LOU.
Proof of Loss
A sworn, itemized claim document the insured signs and submits; the formal ask to the carrier for a specific dollar amount.
Sworn Statement in Proof of Loss
The signed affirmation that the contents of your Proof of Loss are true; knowingly false statements can void the claim.
Sub-limit
A per-item or per-category cap inside a coverage; e.g., jewelry or water backup sub-limits sit below the main coverage limit.
Code Upgrade Endorsement (Ordinance & Law)
Endorsement that funds the extra cost to bring the rebuild up to current building code after a covered loss.
Contents Inventory Rider
A scheduled add-on that lists high-value items at an agreed value so they’re fully covered even above standard sub-limits.
Independent Adjuster
Hired and paid by the insurance carrier to handle claims on the carrier’s behalf; works for the insurer.
Public Adjuster
Licensed representative hired by the policyholder (you) to document, file, and negotiate the claim; works for you.
Mitigation
The reasonable emergency steps a policyholder must take after a loss to limit further damage (tarping, water extraction, board-up); failing to mitigate can reduce payout.
Depreciation
The reduction in value from age and wear; the carrier subtracts it from replacement cost to arrive at Actual Cash Value.
Business Interruption
Coverage that replaces lost income and ongoing expenses when a business is shut down by a covered loss.
Smoke / Soot Infiltration in HVAC
Smoke and soot migrate into ductwork and the HVAC; a separate line item beyond surface cleaning, often missed in the first scope.
Exterior Charring
Burn scarring on siding, roof, or exterior materials from a fire; can signal structural damage even when surface damage looks minor.
Supplement
A re-opening of the claim after the initial estimate, adding line items the first inspection missed (code upgrades, hidden damage, ALE through rebuild).
Appraisal
A policy provision that lets either side demand an independent umpire to resolve a scope dispute; a negotiation lever, not litigation.
Bad Faith
When the carrier fails to handle the claim fairly and promptly; the legal posture when obligation-of-good-faith handling breaks down.
Last reviewed: 2026 — applies to claims handled in NJ, PA, and CO.
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