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Benson Kearley IFG helps you understand...

The world of insurance can be quite hard to understand. We’re here to provide you with terms you can understand, give you advice and offer our help—all right at your fingertips.

Insurance Glossary

C

CANCELLATION

Termination of a contract of insurance in force. Also known as Termination, Dissolution.

CAPITAL GAINS (loss)

The amount by which the sale price of an investment exceeds (falls short of) the original purchase price.

CENTRAL VACUUMING SYSTEM

Vacuum-cleaning system integrated into a building's structure.

CERTIFICATION

Compliance with criteria defined by safe standards.

CHIMNEY

Shaft for conveying gases outside, connected to a dwelling via either the exterior or the interior.

CIVIC LIABILITY

Liability to other motorists, pedestrians and property owners that you assume when operating your automobile on a public roadway.

CLAIM

A requirement by an individual or corporation to recover a loss covered by an insurance policy.

CO-INSURANCE CLAUSE

Clause in an insurance policy requiring the policyholder to maintain insurance at least equal to a specified minimum percentage of the actual cash value, failing which the policyholder must bear, in addition to the deductible amount, a proportionate amount of any partial loss. Also known as Guaranteed amount clause, Average clause, Rule of apportionment.

COLLATERAL

An asset that is pledged as insurance against the default of payment of a debt.

COLLISION

Accident involving impact of a vehicle against another vehicle or an object of some kind.

COMMERCIAL OCCUPANCY

The portion of a building used for the transaction of business.

COMMERCIAL PAPER

A form of debt that is short-term and issued by large corporations.

COMMON STOCK

A security representing ownership of a corporation's assets. Voting rights are normally accorded to holders of common stock.

COMPREHENSIVE COVERAGE

Comprehensive insurance reimburses you for damage to your own car from causes other than collision or overturning. The comprehensive portion of your policy pays for loss due to perils like hail, flood, theft, fire, glass breakage, falling objects, missiles, explosions, earthquakes, windstorms, vandalism or malicious mischief, riot or civil commotion, and collision with a bird or an animal.

When you look at a policy's comprehensive coverage, check for exclusions or limitations. If you have a special audio system installed in your car, for example, you should make sure your policy would cover the cost of the equipment if it were damaged or stolen.

It's also important to know if the policy pays for the actual cash value of damaged or stolen property (its current value after depreciation has been subtracted or the full amount required to replace it today.)

COMPULSORY INSURANCE

Any form of insurance that is required by law.

CONSEQUENTIAL DAMAGE

A loss that is an indirect result of an accident or fire, e.g. food spoiled during refrigerator breakdown.

CONSUMER PRICE INDEX

A statistical device that measures the change in the cost of living for consumers. It is used to illustrate the extent that prices have risen or the amount of inflation that has taken place and therefore the change in purchasing power of currency.

CONVERTIBLE

A condition attached to a security such as a bond, debenture or preferred share that may be exchanged by the owner, usually for common stock of the same company in accordance with the terms of the conversion privilege.

CONVICTION

Conviction under the Highway Safety Code or any other legislation governing vehicular traffic, for an infraction such as, for example, failure in the duties of a driver involved in an accident; violation of the traffic rules pertaining to school buses.

CORD OF WOOD

Legal unit of measurement defined by the Weights and Measures Regulations as "128 cubic feet of stacked roundwood (whole or split, with or without bark) containing wood and airspace with all bolts of similar length piled in a regular manner with their longitudinal axes approximately parallel." This is about a track of wood of 4 feet on 8 feet on 4 feet.

CORPORATION, LEGAL ENTITY, CORPORATE BODY, CORPORATE PERSON

Corporation that does not include a partnership and is considered a separate legal entity, empowered to enter into and be bound by agreements.

CORRELATION

A measurement that describes the relationship between the returns of two risky assets. A positive correlation means their returns move together (one goes down, the other goes down). A negative correlation means the two assets' returns move in opposite directions (one goes down, the other goes up) offering diversification.

COST

Dollar value.

COVERAGE

1. The nature of protection afforded by a particular policy.

2. Amount of insurance applicable to a person or property. At times, interchangeable with the terms Insurance and Protection.

CREDITOR

Corporation or individual to whom a sum of money is owed.

CURRENCY RISK

The risk that the exchange rate on a foreign currency will fluctuate in a direction that damages the position of an investor.

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