Homeowner's Insurance Terminology Guide

Assuming you're investigating homeowner's insurance coverage, you will need to ensure that the protection will cover anything and everything you may need. Particularly in case there is a disastrous situation, you do not want to realize that your policy isn't as extensive as you figured. Still, sometimes it may be difficult to grasp the terminology relating to home insurance policies. Here is a brief explanation of several common insurance terms.

All Physical Loss (APL)

Property with APL coverage signifies that you're covered for damage caused by nearly all scenarios, unless specifically excluded by your policy. Standard exemptions incorporate but aren't limited to flood or water damage, wear and tear as time passes, earthquake exceptions have to be properly taken into account when it comes to any insurance policy.

Named Peril (NP)

Named Peril is a little less complete, and means that protection provides for only that which is mentioned within the insurance plan.

Declarations Page / Dec Sheet

This is just a report, attached with the plan, describing many of the basic details of the insured property or home. This can include private information, the address of the property, coverage expiration date, a number of coverage specifics and monthly premium cost.


This is an add-on to the basic insurance plan that modifies, changes, expands or removes certain areas of the original policy you consented to. All these alterations arediscussed with your insurance carrier and are adapted based on your particular specifications.

Actual Cash Value (ACV)

ACV is how much money the insurer will pay to replace your ruined item, and considers the actual item's price and endurance compared with how much you acquired it for, and the amount of time you or your family have had it. As an example, if you purchased something in 2006 that could have lasted ten years, the insurance coverage will cover 60% of it, because you got 40% of usage from it.

Replacement Cost Value (RCV)

RCV is the greatest amount the insurance company will pay for protected belongings and assets if devaluation is not a consideration, and likewise varies according to the present-day cost of a brand-new product similar to the affected property or home.

You are very likely to come across any and all of the above in a Property Insurance section of a policy. If you're buying additional or new coverage or examining any problems with your established coverage, it's really important to know for sure just what you're investing in, and what you still will have to protect.

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