- Lapse
Termination of a policy because of failure to pay the premium.
- Lessee
The person, to whom a lease is granted, commonly called the tenant.
- Lessor
The person granting a lease, also known as the landlord.
- Liability Insurance
In an accident where you are charged with injuring another person or damaging his or her property, liability insurance pays the cost of your legal defense, as well as the cost of any damages for which you are found legally responsible. Liability, Collision and Comprehensive.
These are the three main types of coverage available in an auto insurance policy. Liability pays other people if you've injured them or damaged their property. Collision pays to repair damage to your car caused by (what else?) collisions. Comprehensive pays you for your losses due to theft and other calamities that are unrelated to collisions – like damage from hail, fire, vandalism, floods, etc.
- Liability Limits
The sum or sums beyond which a liability insurance company does not protect the insured on a particular policy.
- Libel
A written statement about someone, which is personally injurious to that individual.
- Limit of Liability
The maximum amount, which an insurance company agrees to pay in case of loss.
- Limits
Maximum amount a policy will pay either overall or under a particular coverage.
- Loss
Generally refers to:
- the amount of reduction in the value of an insured's property caused by an insured peril,
- the amount sought through an insured's claim, or
- the amount paid on behalf of an insured under an insurance contract.
- Loss of Use Insurance
Coverage to compensate an insured for the loss of use of property if it cannot be used because of a peril covered by the policy.
- Market Value
The price for which something would sell, especially the value of certain types of assets, such as stocks and bonds. It is based on what they would sell for under current market conditions. For example, common stock market value would be the price of the stock as of a specified date.
- Material Misrepresentation
The policyholder / applicant makes a false statement of any material (important) fact on his/her application. For instance, the policyholder provides false information regarding the location where the vehicle is garaged.
- Moral Hazard
A condition of morals or habits that increase the probability of a loss from a peril.
- Morale Hazard
An attitude that increases the probability of loss from a peril. The attitude of, "It's insured; so why worry?" is an example of a morale hazard.
- Mortgage Insurance Policy
In life and health insurance, a policy the benefits from which are intended to pay off the balance due on a mortgage or meet the payments on a mortgage as they fall due upon or after the death or disability of the insured.
- Mortgagee
The creditor to whom a mortgage is given and who lends money on the security of the value of the property mortgaged. MORTGAGOR – The debtor who receives money and in turn grants a mortgage on his property as security for a loan.
- Named Insurance
The first person in whose name the insurance policy is issued.
- Named Perils
Named perils are the specific dangers a policy insures you against – such as fire, windstorm, and hail in a homeowner's policy, for example. These perils are "named" or listed in the policy.
- Negligence
Failure to use that degree of care, which an ordinary person of reasonable prudence would use under the given circumstances. Negligence may be constituted by acts of either omission or commission or both.
- No-Fault Insurance
No-fault insurance is designed to speed up claims payments to accident victims and to lower the cost of auto insurance by reducing the number of lawsuits for minor claims. Under no-fault insurance, a person's own insurance company pays for financial losses like medical expenses and lost wages due to an accident, regardless of who caused it. (In a fault system, your expenses won't be paid by the other party's insurance company until he or she has been proved negligent.) In exchange, the right to sue may be restricted in some cases.
