Whether you need a business liability policy, and coverage for your personal property, the world of insurance can be daunting. Below we provide a glossary of some of the policy jargon and types of coverage you may see or have to consider. Search alphabetically. If you still have questions, or want more information on specific types of needs, our website can be a good resource. Good luck!




Accident Insurance

Accident Insurance provides any person involved with an organization (participants, staff members, volunteers) reimbursement for medical bills due to sustaining a covered injury. This policy is a first responder in the face of possible litigation. Coverage also pertains to members’ traveling to and from an activity or an event sponsored by an organization (travel must be direct and without interruption).


Additional Insured

This is an individual or organization added to an insurance policy as requested by the insured party. This may be enacted in order to protect a contractor or individual with a close relationship to the insured. An example of Additional Insured would be girl scouts, performing community service on behalf of their troop (the original insured party).

An organization may insist that a freelancer/contractor add them into their general liability policy as Additional Insured. If any legal claims are made concerning the actions of the freelancer, this protects the business from the need to assume responsibility for the incident.

Regarding a special event or vendor: The event may request to be additionally insured by the vendor. This protects the event principal from the need to assume responsibility in the case that a vendor’s actions result in legal claims.

For your personal business: The purpose of adding an external party as additionally insured in your policy is to prevent loss or accusations of negligence of your company. When that external party adds you to their policy, it protects you from negligence resulting on their behalf.

In summary, an additional insured is an entity covered under your liability policy. In order to have this coverage, the entity must be involved with you in a business relationship that has potential to result as a source of liability. For instance, a family hires a contractor to paint their house; therefore, a business relationship is established. That contractor falls off an unstable ladder provided by the family and sustains an injury. The contractor can then sue the family for said injury caused by their negligence.


Additional Insured Endorsement

Various insurers’ liability policies may or may not include language that would provide automatic coverage to very specific additional insureds. If a policy lacks the proper language, an endorsement is necessary to amend the policy and add another entity as an insured.








Endorsements add coverage to your policy. They increase the premium because they provide some additional benefit.


Excess Medical/Accident Insurance

This coverage pays medical expenses remaining after personal health insurance has been utilized. While excess coverage is secondary to the individual’s personal insurance, it is beneficial in that it covers out-of-pocket expenses including, co-payments and deductibles of the injured party.



Exclusions limit coverage under a liability policy. They are intended to reduce the insurance company’s risk for large payouts to entities that are at significantly higher probability for a particular claim. Likewise, they keep rates fair for everyone else who is not in that unusually higher risk category. Familiar illustrations of exclusions include:

  • Pre-existing conditions in health or insurance
  • Flood coverage for a home or business in a flood zone
  • Suicide in a life insurance policy



Fire Damage Legal Liability/Damage to Premises Rented

Damages to Premises Rented to You is for renters. Fire Damage Legal Liability is contained in this clause, and applies only if the fire damage was caused by the renter’s negligence. So, if a fire were to start from a bolt of lightning striking the building, as it is considered an “Act of God”, it would not be covered by the clause.

Damages to Premises Rented to You apply only to third party claims. The property must have been occupied by the renter for seven days or less.

Coverage is an automatic inclusion per Coverage A, Bodily Injury (BI) and Property Damage Liability. This coverage is accessible through exceptions to specific exclusions listed under Bodily Injury and Property Damage Liability Coverage.

Please note: Fire Damage Legal Liability coverage is not a substitute for commercial property coverage. This means your landlord is generally required to have insurance covering physical damage to the building (unless your lease stipulates otherwise).



General Liability Insurance Limit: Aggregate

This is the remaining insurance allotted to pay damages not otherwise specified in the policy, when injury or affliction occurs during the covered period.

The maximum payment by the insurer is normally twice the limit of a single occurrence. This holds true for any policy period concerning any and all of the occurrences.


General Liability Insurance Limit: Advertising Injury

An Advertising Injury is one that affects the promotion or advertisement of services and/or materials. This could arise from:

  • infringement of copyright, slogan trademark or trade name
  • misappropriation of advertising methods or manner in which business is carried out
  • slander or libel of an organization
  • disparagement of goods, services, or products
  • privacy violation

This is covered under general liability coverage, which includes commercial general liability (CGL), in conjunction with personal injury (PI) coverage.


General Liability Insurance Limit: Medical Expense

This limit is expressed by Coverage C. Therefore, it is a separate insuring agreement that would require the insured to cover reasonable medical expenses for bodily injury incurred by the subject or by accident. Fault is not a deciding factor. The expense limit is subject to the CGL Terms & Conditions, and is listed in the declarations. The Medical Expense Limit pertains to an individual person. If the incident is a recurring event, the payout will be reduced in each instance. Additionally, this will reduce the general aggregate limit.


General Liability Insurance Limit: Occurrence

This limit is the maximum coverage an insurer is willing to provide per occurrence. This remains firm regardless of the number of injured parties, the extent of property damage, or the number of claims made.


General Liability Insurance Limit: Personal Injury

Personal Injury covers incidents not associated with direct Bodily Injury (BI), including:

  • false arrest
  • detention
  • imprisonment
  • malicious prosecution
  • wrongful eviction
  • slander
  • libel
  • invasion of privacy

This is most often included in general liability coverage. Umbrella liability coverage would additionally include BI.



Hired/Non-Owned Auto Liability

Non-Owned Auto Liability is automobile insurance that provides liability protection for employees who, on occasion, drive their own vehicle for business use. This policy has an assumption that the employee’s vehicle is not owned, registered, or contracted in the name of the business or on its behalf.

Hired automobile insurance provides liability protection for employees who have rented, hired, or borrowed a vehicle for business use. This insurance protects the business if faced with legal liability due to an automobile accident that the employee or business owner has in said vehicle, for business use.

This coverage excludes physical damage sustained by the automobile.


Host Liquor

Host Liquor Liability coverage is for bodily injury (BI) or property damage (PD) that may occur during the consumption of alcohol by a person attending an event the insured hosts. An example of an instance covered under the clause would be BI or PD resulting from a wedding attendee becoming intoxicated, falling, and hitting his/her head on the side of a table.

Host liquor liability exposure is insurable under the General Liability policy.




Insurance is used to protect an individual, or organization and its members, against financial distress if unexpected loss should occur. Two factions of this entity are Risk Management and Transfer of Risk.





Liquor Liability

If your business plans to produce, sell, distribute, or serve alcohol to the public, this endorsement must be added to your liability policy.





Negligence is the failure to protect others, and by doing so causing unintentional harm. This delineates an unsatisfactory standard of care as compared to the actions of a reasonably sensible person. Risk management is advised in order to prevent negligence, and to take measures to avoid the possibility of a negligent act to occur.



Participant Liability

This is liability protection covering participants and third-party spectators at your event. Examples of entities that need this coverage include:

This is an all-encompassing form of liability coverage, however, not stand-alone. When Participant Liability coverage is purchased you will also be required to purchase Excess Accident Medical coverage. All together, this will cover participants at your event in addition to third party spectators.


Primary Non-Contributory Endorsement

This clause specifies the order in which multiple policies must be paid out when triggered by the same incident. Often, this term is included in contract insurance requirements. A contractor may possess multiple policies purporting to be primary. However, it may be necessary that the contractor have multiple forms of insurance delineated as primary and also noncontributory.


Products and Completed Operations Limit

The purpose of this coverage is to the protect the insured from potential claims caused by products represented by their company. This could include materials produced, handled, distributed, or sold that are no longer in the insured’s possession (i.e. sold directly or via other channels). It also includes operations that have been finished by the insured company or professional.


Property Damage Liability

Property Damage Liability can not be substituted for property insurance! They are separate entities. This clause has a tendency to confuse the insured, because they see their Liability policy protects them from claims per property damage and bodily injury (BI) to outside parties. This means this clause covers you ONLY if the damage is due to your negligence. For personal business property and equipment coverage, a separate policy is required. An example of such a separate policy would be an Inland Marine/Equipment Floater.


Property Insurance

Property coverage protects against loss in the event that an individual or entity must repair or replace their physical property due to theft, destruction by a coverage means, or damage.

Policies vary, but Property Insurance may provide interim income during a time that the incident caused a business to lose income.

Property Insurance may be customized to the specific needs of an organization. This is done by adding a variety of coverage forms and endorsements. Below, you will find several common additional coverage options available for addition to many property insurance policies.


Property Insurance: Back-Up of Sewer or Drain Water Damage

This type of property insurance is to protect against loss incurred by backup of water from drains or sewers due a pump overflowing.


Property Insurance: Boiler and Machinery

This provides coverage, for stipulated losses, of cost to repair or replace industrial equipment, such as boilers, heating units or systems, or air conditioning units or systems.


Property Insurance: Business Interruption

Business Interruption insurance provides for profit and cash flow lost as a result of an interruption disallowing the business to operate at full capacity.


Property Insurance: Crime

Crime Property Insurance provides coverage of business assets in the instance of loss due to crime. Examples of crime include forgery or alteration, theft of money and securities, burglary or robbery, and computer fraud.


Property Insurance: Earthquake Coverage

Earthquake coverage is simply for loss resulting from an earthquake.


Property Insurance: Employee Dishonesty Coverage

Coverage provided to protect a company from financial loss in the event that an employee were to commit a fraudulent or dishonest act.


Property Insurance: Inland Marine

An Inland Marine policy covers damage or destruction of business property while the insured is in transit. Perils listed under Inland Marine include bridge collapse, collision, derailment, earthquake, fire, flood, landslide, and windstorm.


Property Insurance: Tenant Glass

Coverage provided for damage or loss to glass. Often, lease agreements will require that tenants hold Tenant Glass coverage on their own.


Property Insurance: Tenant Improvements & Betterments

This coverage protects the tenant or property lessee from loss as a result of peril (type of peril is defined by lease). Repair is required to be completed by the tenant per lease agreement.





Sexual Abuse and Molestation

Sexual Abuse and Molestation coverage protects against claims or accusations of sexual abuse or molestation. Most General Liability policies do not cover this under their standard agreement, but may allow its addition as an endorsement, for a premium.


Spectator Only Liability

This coverage prevents the necessity to assume responsibility for injury sustained or property damage suffered by observers of an activity. The clause can be found within the General Liability policy. Additionally, preventative measures can be put in place to inhibit exposure to these variables.






Waiver of Subrogation

A waiver of subrogation disallows the claimant to pursue a filed claim against the party responsible.

The purpose of this waiver is to give an insurance company the right to take suitable legal action against the party responsible for the loss of payment delivered to the insured. When a contract includes a waiver of subrogation, the insurance provider’s subrogation rights are waived. Thereby, the waiver prevents the insurance provider from taking legal action to recover loss incurred from the third party responsible for the damages.