The language of home insurance quotes and policy terms isn't complicated – it's just dense. These 15 terms are the vocabulary that lets you read any quote or policy wording with confidence; each one comes with a plain everyday sentence and a link to the article that goes deeper.
- 15 terms, each in one plain sentence – the full A-to-Z glossary is a separate article.
- The five most important: sum insured, rebuilding value, underinsurance, deductible, exclusion.
- If a quote uses a word you don't recognise, ask about it before you sign – a good broker welcomes the question.
Terms about value
Sum insured: the ceiling up to which the insurer pays out for a given group of property. Rebuilding value: the amount it would take to rebuild the house today – this is what we size the building's cover to (why not the market price). Underinsurance: when the sum insured is below the real value – in which case the insurer can apply proportional settlement. Indexation: the value tracking that happens at renewal, which keeps the sum insured in step with prices (how it works).
Terms about cover
Insured event: the loss defined in the policy wording that cover responds to – the wording's definition decides, not everyday usage. Exclusion: what cover doesn't extend to (exclusions map). Limit: an internal ceiling set for a particular type of damage or group of property – typically found with valuables. Deductible: the portion of a claim that stays with you – in exchange for a lower premium (deductible logic). Optional cover: a layer you can add to the base package – glass, liability, assistance (the map). Waiting period: for certain covers, the period after signing during which protection isn't active yet – typically found with special risks.
Terms about claims
Claim notification: reporting the loss via the insurer's claims line or online portal – always the primary route (how it's done). Mitigation: your duty to keep the damage from growing further within reasonable limits – turning off the main tap, covering an opening. Claims inspection: the insurer's on-site assessment; it's worth waiting for this before carrying out permanent repairs. Depreciation: the reduction in value due to age, which plays a role in certain payouts. Mortgagee clause: the entry registered in the bank's favour alongside a mortgage – the bank can also have a say in the payout (mortgage and insurance).
How to put this vocabulary to use
When you're reviewing a quote, work through it term by term: how large is the sum insured and how was it worked out, what's the scope of covered events, where are the limits and deductibles, what's excluded. These four questions are also the core of our five questions to ask before signing. And if a quote uses a term that isn't on this list, the full glossary or a quick question will help – the quickest option is the latter: book a time here.
One tip for practice: get out your own policy and try to find these fifteen terms in it. Whatever isn't clear at first glance – say, which sum applies to what, or where the deductible sits – is exactly the question worth clarifying at your next renewal or in a consultation.
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