Insurance Appraisal Glossary: ACV, Umpire, SCWHUA & More

Search the glossary

A C D E H M N O P R S U W X

Actual cash value (ACV): The replacement cost of damaged property minus depreciation for age and wear. Many policies pay ACV first and the balance after repairs are finished.
Additional living expense (ALE): The increase in your normal living costs, such as a rental or hotel and extra meals, while a covered loss leaves your home unlivable. It is usually paid under Coverage D.
Anti-concurrent causation: Policy wording that excludes a loss caused by an excluded peril, such as flood, even if a covered peril, such as wind, contributed at the same time. Courts read these clauses differently, so legal advice matters when one is in play.
Appraisal award: The written decision that sets the amount of loss, signed by at least two of the three panel members. It is generally binding on the amount but not on coverage questions.
Appraisal clause: The policy provision that lets either party demand appraisal when they agree a loss is covered but disagree on its amount. It sets out how appraisers and the umpire are chosen.
Appraiser: The person each side chooses to value the loss during appraisal. Most policies require the appraiser to be competent and disinterested.
Catastrophe savings account: A tax-advantaged savings account created by South Carolina’s 2007 coastal insurance reforms. Homeowners can use it to set money aside for a hurricane deductible or other uninsured storm losses.
Coinsurance: A clause, common in commercial policies, that reduces a claim payment if the property was insured for less than a required percentage of its value. The shortfall is shared by the policyholder.
Coverage A (dwelling): The part of a homeowners policy that covers the house itself and attached structures. Its limit is often the base for percentage hurricane deductibles.
Coverage B (other structures): Coverage for detached structures on the property, such as fences, sheds and detached garages. Its limit is usually a percentage of Coverage A.
Coverage C (personal property): Coverage for belongings such as furniture, clothing and electronics. It may pay actual cash value or replacement cost depending on the policy.
Coverage D (loss of use): Coverage for additional living expense or lost rental income when a covered loss makes the home unlivable. It is often limited by dollars or time.
Declarations page: The summary page of a policy listing the insured, the property, coverage limits, deductibles and endorsements. In South Carolina, hurricane deductibles must be clearly disclosed on it.
Deductible: The portion of a covered loss the policyholder pays before the insurer pays. It may be a flat dollar amount or a percentage of the dwelling limit.
Depreciation: The reduction in value of property due to age, wear and condition. It is the difference between replacement cost and actual cash value.
Earthquake endorsement: An add-on that brings earthquake damage into a policy that otherwise excludes it. It usually carries its own, often large, percentage deductible.
Endorsement: A written change to a policy that adds, removes or modifies coverage. Endorsements control over the base policy wording where they conflict.
Hurricane deductible: A separate deductible that applies to losses from a hurricane, often a percentage of the dwelling limit. The policy’s trigger wording defines when it applies instead of the standard deductible.
Matching: The question of whether undamaged materials must be replaced so repairs match in color, texture and appearance. Policy wording and the availability of materials drive these disputes.
Mitigation: Reasonable steps to protect property from further damage after a loss, such as tarping a roof or drying a wet room. Most policies require it and pay reasonable mitigation costs.
Mortgagee clause: A policy provision that protects the mortgage lender’s interest in the property. It is why lenders are often named on claim checks.
Named storm: A tropical storm or hurricane that has been given a name by the National Hurricane Center. Some policies use a named-storm deductible triggered by any such storm, not only hurricanes.
National Flood Insurance Program (NFIP): The federal program that writes most flood insurance in the United States. Its standard flood policy has its own rules, deadlines and appraisal provision.
Ordinance or law coverage: Coverage for the extra cost of meeting current building codes when damaged property is repaired or rebuilt. It is often limited to a percentage of the dwelling limit.
Overhead and profit: The general contractor’s charge for managing and coordinating a job, often estimated at 10% overhead plus 10% profit. It is a frequent dispute when a repair involves several trades.
Peril: A cause of loss, such as wind, hail, fire, lightning or theft. Policies either list covered perils or cover all perils except those excluded.
Proof of loss: A sworn statement of the amount claimed and supporting details. Some policies, including the NFIP flood policy, require it within a set time.
Recoverable depreciation: Depreciation held back from an initial replacement cost claim payment that can be recovered once repairs or replacement are completed. Time limits often apply.
Replacement cost value (RCV): The cost to repair or replace damaged property with materials of like kind and quality, without deducting depreciation.
Reservation of rights: A letter in which the insurer says it is handling a claim while reserving the right to deny coverage later. It signals a possible coverage issue worth reviewing carefully.
SC Safe Home: A South Carolina grant program, created under the 2007 coastal insurance reforms, that helps eligible homeowners pay for wind-resistance upgrades such as roof-to-wall connections and opening protection.
Scope of loss: The list of damaged items and the repair work each one needs. Most appraisal disputes start with differences in scope rather than in unit prices.
South Carolina Department of Insurance (SCDOI): The state agency that regulates insurers, licenses adjusters and handles consumer complaints. It does not decide the value of individual claims.
South Carolina Wind and Hail Underwriting Association (SCWHUA): The insurer of last resort for wind and hail coverage in designated coastal areas of South Carolina. Its wind-only policies are often paired with a homeowners policy that excludes wind.
Square (roofing): A unit of roof area equal to 100 square feet. Roofing estimates are priced per square, plus a waste factor.
Steep charge: An added labor charge for working on steep roof slopes, commonly applied at about a 7/12 pitch and steeper. It is a frequent line-item dispute in roof estimates.
Storm surge: Seawater pushed ashore by a hurricane or tropical storm. Damage from surge is treated as flood and is excluded from standard homeowners and wind policies.
Subrogation: The insurer’s right, after paying a claim, to pursue a third party who caused the loss. Policyholders must not waive that right without the insurer’s consent.
Suit limitation: The time limit for filing a lawsuit over a claim, set by the policy, by statute or both. Confirm the deadline that applies with a South Carolina attorney.
Supplement: A request to add items or costs to an insurer’s estimate, often after hidden damage is found during repairs. Many disputes resolve through supplements without appraisal.
Umpire: The neutral third member of an appraisal panel who decides only the items the two appraisers cannot resolve. Agreement by any two panel members sets the award.
Wind-driven rain: Rain forced into a building by high wind. Many policies cover interior water damage only if wind first creates an opening in the roof or walls.
Xactimate: Estimating software widely used by insurers, adjusters and contractors to price repairs with regional cost data. Appraisers often build or compare estimates in it.

Insurance Appraisal Glossary of Claim Terms