A named insured is any individual or entity that is listed as an insured by name on the insurance policy. They are the primary party listed on the policy and in addition to having coverage and the ability to make changes, they are also responsible for paying the insurance premiums.
Mortgage companies and lienholders often ask to be listed as additional insureds on homeowners or auto insurance policy. This protects them in the event the home or vehicle is damaged by providing payment for the amount still owed on the loan.
It is a good idea to have both your auto and homeowner’s insurance with the same agency. This is the best way to avoid gaps in coverage. Having all of your insurance policies with one agent is beneficial because they will get to know you and your unique situation. It is helpful to know someone’s situation when an agent has to recommend the best coverages. Plus, you may even get a discount for having both policies with one agency.
In many cases you will hear the terms replacement cost (the cost to replace something with like kind and quality) and actual cash value. In simple terms, actual cash value is replacement cost minus depreciation. For example, if you purchased a 50” television for $1,200 5 years ago, and it is damaged in a fire, the insurance company would take into account that it is 5 years old when calculating the claim payout if you have actual cash value.
A deductible is an amount of money, sometimes $500 or $1,000 depending on your policy, that is your responsibility at the time of a claim. It is the insurance company’s way to ensure that any small claims will be paid by you rather than submitted. Usually, the company will simply deduct this amount from your claim check once it is determined to be a covered loss.