These definitions are offered only as aids to understanding. Your policy terms and conditions will determine how your policy responds to a loss.

Actual Cash Value  This is a method of property valuation that considers a loss in value caused by age, wear and tear, and maintenance. It assumes that some financial benefit has been derived from the use of the property before a loss occurred.

Flood  Excluded under homeowners insurance policies, flood is defined as a general rising of surface waters over normally dry land. This does not include sewer and drain backup.

Loss of Use  A homeowner’s policy feature that pays the reasonable costs to house you and your family at another location after your home has become uninhabitable due to a covered loss.

Negligence  This is the failure to live up to a reasonable standard of action. If a neighbor trips over your dog or you splash paint on his new car, you’ll probably be responsible for the medical expenses and body repair. The liability coverage of a homeowners policy responds to negligence.

Other structures  This term means structures on your lot that are attached to the premises, but not to the home itself. Things like fences, sheds, detached garages, brick barbecues and even swimming pools are included in this term. If the item is more portable, it’s probably Personal Property.

Personal Liability  This refers to your legal obligation to pay damages to someone else because your negligence has caused injury to a person or damage to their property. A homeowner’s policy does not respond to business activities.

Personal Property  Your stuff. Clothing, furniture, books, appliances, things that can be removed from the premises without causing damage. Personal property that you use in a business may not be covered.

Replacement Cost  This is the amount needed to repair or replace damaged property with materials of similar kind and quality. Insuring to this amount promotes a more complete recovery. The cost to repair can be much higher than the original cost to build.