Oak Tree Insurance
503.635.3303 | 800.394.9899
5335 Meadows Rd. Suite 101 - Lake Oswego, OR 97035
Fax:(503)635-7491  info@oaktreeins.com
 







  

Insurance Words 

ACCOUNTS RECEIVABLE COVERAGE
This coverage provides protection for the following losses:
1. All sums due you from customers, providing you are unable to effect collection thereof as a direct result of loss or damage to records of accounts receivable.
2. Interest charges on any loan to offset impaired collections pending repayment of such sums made uncollectible by such loss or damage.
3. Collection expense in excess of normal collection cost made necessary because of such loss or damage.
4. Other expense, when reasonably incurred by you in re-establishing records of accounts receivable following loss or damage.
ACTUAL CASH VALUE (ACV)
"Actual Cash Value" is the replacement cost of property damaged or destroyed at the time of loss, with deduction for depreciation. Actual cash value cannot exceed the applicable limit of liability shown in the declarations of the policy, nor the amount it would cost to repair or replace such property with material of like kind and quality within a reasonable amount of time after a loss.
ADDITIONAL INSURED
An individual or entity that is not automatically included as an insured under the policy of another, but for whom the named insured's policy provides a certain degree of protection. An endorsement is typically required to affect additional insured status. The named insured's impetus for providing additional insured status to others may be a desire to protect the other party because of a close relationship with that party (e.g., employees or members of an insured club) or to comply with a contractual agreement requiring the named insured to do so (e.g., customers or owners of property leased by the named insured).
ADDITIONAL NAMED INSURED
1. An individual or entity, other than the first named insured, identified as an insured in the policy declarations or an addendum to the policy declarations.
2. An individual or entity that is added to a policy with the status of named insured after the policy is written. Such an individual or entity would have the same rights and responsibilities as an individual or entity named as an insured in the policy declarations (other than those rights and responsibilities reserved to the first named insured). In this sense the term can be contrasted with additional insured, an individual or entity added to a policy as an insured but not as a named insured. The term additional named insured has not acquired a uniformly agreed-upon meaning within the insurance industry, and use of the term in the two different senses defined above often produces confusion in requests for additional insured status between contracting parties
 ADDITIONS AND ALTERATIONS
Additions and Alterations coverage protects any additions, alterations, and improvements you make to your unit, for up to 10% of your contents limit. This coverage can be increased.
ADVERTISING INJURY LIABILITY
"Advertising Injury" means injury rising out of an offense committed in the course of your advertising activities, if such injury rises out of libel, slander, defamation, violation of right of privacy, piracy, unfair competition or infringement of copyright, title or slogan.
AGGREGATE
1. A limit in an insurance policy stipulating the most it will pay for all covered losses sustained during a specified period of time, usually one year. Aggregate limits are commonly included in liability policies. While not often used in property insurance, aggregates are sometimes included with respect to certain catastrophic exposures, e.g., earthquake and flood.
2. The dollar amount of reinsurance coverage during one specified period, usually 12 months, for all reinsurance losses sustained under a treaty during such period.
AGREED AMOUNT ENDORSEMENT
This endorsement is an agreement made by the insurance company wherein it waives the coinsurance clause on the specified property. As long as this endorsement is in effect, there would be no coinsurance penalty at the time of a claim.
By combining an Agreed Amount Endorsement with a Replacement Cost Endorsement (see separate explanation), you can obtain an unusually high quality of insurance coverage!
ALIENATED PREMISES EXCLUSION
This exclusion eliminates coverage for property damage liability to premises alienated (i.e., sold) by you. For example, you own a lot and build a house on it. After the house is completed and sold, a subcontractor's faulty wiring causes the house to burn. The buyer, or his/her insurance company, sues you for the cost of repairing or rebuilding the house. There is no coverage for this exposure under standard liability policies.
AUDIT
Sometimes factors that enter into determining appropriate premiums for insurance coverage can't be known in advance; therefore, accurate premiums for the coverage provided can't be billed by the insurance carrier. This often is true in the case of Worker's Compensation and Product Liability insurance, where such things as payroll and sales can't be determined ahead of time. An audit serves as an examination of the insured's records after the fact to adjust the initial premium billed to reflect the actual coverage.
AUTOMOBILE ACCIDENTS AND NO INSURANCE
If you don't have Personal Automobile insurance -- perhaps because you use a company vehicle -- you have a number of possible uninsured exposures.
For example, you may be without protection in any of the following situations:
  • If you borrow someone else's car.
  • If you rent a car.
  • If you are injured while using a borrowed or rented car -- whether you're driver or passenger.
  • If you suffer a loss of income as a result of injury while using a borrowed or rented car -- whether you're driver or passenger.
  • If a member of your family (spouse, child, etc.) is involved in any of the above-mentioned situations.
  • If you are involved in an accident with an uninsured driver.
  • If you are driving a company-owned/-insured car with a "fellow employee" as passenger.
  • If you are subject to any of these exposures, it may be both easy and economical to obtain coverage. In many cases, the purchase of Personal Automobile insurance is not necessary, assuming you don't own or "long-term" lease a vehicle.
  • In addition, if you don't give adequate, repeat warning of these exposures to your employees that have company vehicles, and urge the possible need for Personal Automobile insurance, you might be held liable for their uninsured accidents! Furthermore, this "error" or "omission" would not be covered under your Commercial Automobile policy.
  • If any of this information applies to you, please call us to explain your particular circumstances so we can determine what needs to be done to correct this situation for you.
NEW JERSEY AUTOMOBILE RECOMMENDATION
New Jersey private passenger automobile insured’s that have Personal Injury Protection (PIP) coverage have the option to purchase one of the following Added Personal Injury Protection packages. Simply check the appropriate box(es) below and return this form to us.
The benefits indicated under each option for income and essential services are the aggregate of the Basic and Added PIP benefits. The benefits are maximum benefits on a per person, per accident basis, rather than a per year basis. All of the options include a $2,000 maximum funeral expense benefit and $10,000 death benefit.
Please call to obtain any additional coverage information you may need.

(1) Two-Year Benefits: Income Continuation/Survivor and Essential Services Benefits

                   Income/Survivor        |       Essential Services      
A               B              C               D       
 
Option          Weekly          Total         Per Day          Total     
 
   1             $100          $10,400          $12            $8,760     
 
   2             $125          $13,000          $20           $14,600    
 
   3             $175          $18,200          $20           $14,600    
 
   4             $250          $26,000          $20           $14,600    
 
   5             $400          $41,600          $20           $14,600    
 
   6             $500          $52,000          $20           $14,600    
 
   7             $600          $62,400          $20           $14,600    
 
   8             $700          $72,800          $20           $14,600    
 
 

(2) Extended Income Continuation Benefits: Two-Year Survivor and Essential Services Benefits

                    Income            |            Essential Services         

 A            B              C            D     
Option        Weekly         Total        Daily       Total   
 
   9           $100        Unlimited       $12        $8,760   
 
 10           $125        Unlimited       $20       $14,600  
 
 11           $175        Unlimited       $20       $14,600  
 
 12           $250        Unlimited       $20       $14,600  
 
 13           $400        Unlimited       $20       $14,600  
 
 14           $500        Unlimited       $20       $14,600  
 
 15           $600        Unlimited       $20       $14,600  
 
 16           $700        Unlimited       $20       $14,600  
 
 

(3) Approximate Additional Annual Costs
Please note the approximate additional annual cost of each of the following options:
Option 6 -- $7.00 per private passenger vehicle
Option 7 -- $11.00 per private passenger vehicle
Option 14 -- $54.00 per private passenger vehicle
Option 15 -- $69.00 per private passenger vehicle
Option 16 -- $82.00 per private passenger vehicle
Also note that resident relatives can be added if named, at an additional annual cost of $8.00.
NEW YORK AUTOMOBILE RECOMMENDATION
New York private passenger automobile insured’s that have Personal Injury Protection (PIP) coverage have the option to purchase one of the following Added Personal Injury Protection packages. Simply check the appropriate box(es) below and return this form to us.
The benefits indicated under each option for income and essential services are the aggregate of the Basic and Added PIP benefits. The benefits are maximum benefits on a per person, per accident basis, rather than a per year basis. All of the options include a $2,000 maximum funeral expense benefit and $10,000 death benefit.
Please call to obtain any additional coverage information you may need.

(1) Two-Year Benefits: Income Continuation/Survivor and Essential Services Benefits

                    Income/Survivor     Essential Services
                      A        B          C         D
           Option   Weekly   Total     Per Day    Total
           1 { }    $100    $10,400      $12    $ 8,760
           2 { }    $125    $13,000      $20    $14,600
           3 { }    $175    $18,200      $20    $14,600
           4 { }    $250    $26,000      $20    $14,600
           5 { }    $400    $41,600      $20    $14,600
           6 { }    $500    $52,000      $20    $14,600
           7 { }    $600    $62,400      $20    $14,600
           8 { }    $700    $72,800      $20    $14,600

(2) Extended Income Continuation Benefits: Two-Year Survivor and Essential ServicesBenefits

              Income                    Essential Services
             A      B                             C        D
                                       Maximum
                                       Survivor   Per
          Option   Weekly   Total      Benefits   Day    Total
          9 { }    $100   Unlimited    $10,400    $12    $ 8,760
         10 { }    $125   Unlimited    $13,000    $20    $14,600
         11 { }    $175   Unlimited    $18,200    $20    $14,600
         12 { }    $250   Unlimited    $26,000    $20    $14,600
         13 { }    $400   Unlimited    $41,600    $20    $14,600
         14 { }    $500   Unlimited    $52,000    $20    $14,600
         15 { }    $600   Unlimited    $62,400    $20    $14,600
         16 { }    $700   Unlimited    $72,800    $20    $14,600

(3) Approximate Additional Annual Costs
Please note the approximate additional annual cost of each of the following options:
      • Option 6 -- $7.00 per private passenger vehicle
      • Option 7 -- $11.00 per private passenger vehicle
      • Option 14 -- $54.00 per private passenger vehicle
      • Option 15 -- $69.00 per private passenger vehicle
      • Option 16 -- $82.00 per private passenger vehicle
Also note that resident relatives can be added if named, at an additional annual cost of $8.00.
BAILEE COVERAGE
Inland marine coverage on property entrusted to the insured for storage, repair, or servicing. It is typically purchased by businesses such as dry cleaners, jewelers, repairers, furriers, etc.
Basic Condominium Coverage’s
Contents coverage is basic. A limit is selected $75,000 for example, based on the value of your contents to replace your things for damages arising from perils named in your policy such as fire, water damage, theft, explosion, and more. There is a deductible usually $500 or a $1000. In a superior policy coverage is provided in a way that allows you to replace your lost property with new items, without depreciation.(Note: Most policies provide depreciated value or almost nothing for most clothing and furniture unless those items are quite new). "Replacement Cost Coverage; i.e., new for old" is preferred.
There are specific limits on the theft of certain types of property such as jewelry, money and securities, watercraft, etc. It may be preferable to schedule specifically your valuables and collectables. There is a credit card coverage up to $10,000 is available.
Additions and Alterations coverage protects any additions, alterations, and improvements you make to your unit, for up to 10% of your contents limit. This coverage can be increased.
Unit assessment coverage pays up to $50,000 for your share of an assessment charged against all unit owners as a result of a covered loss.
Loss of Use is an extra expense you incur while staying at a temporary location if your condo becomes uninhabitable. While most policies allow a limited dollar amount for this coverage, our program is UNLIMITED.
Personal Liability coverage insures you for claims involving damages for which you are held liable. Our program starts with $500,000 limit. Higher limits are available and highly recommended due to the great number of lawsuits and large settlements common today. Limits can often be increased to $5 million.
NON-OWNED AND HIRED CAR
Coverage is for policies written with limits of liability of $1 million or more. It provides coverage for rental or borrowed autos as long as the insured does not own any private passenger vehicles, pick-up, panel truck or van and the use doesn’t exceed 30 days.
Also recommend is Personal Excess Liability Coverage, often called an Umbrella policy. A personal Excess Liability Policy provides you with liability Coverage for damages for which you or members of your household may be legally responsible for beyond the basic limit.
Related Topics:
Umbrella Coverage
Excess liability coverage -- often called umbrella -- is an important addition to your insurance portfolio. A personal excess policy provides you with additional protection for damages in which you or members of your household may be legally liable. (In our litigious society) this policy helps to protect you and your loved ones against the cost of those damages which might appear to be minor--such as a fender bender--but actually end up being costly over time. That minor accident could turn into a lawsuit for the ongoing back or neck problems of the other driver.
An Umbrella or Excess liability policy provides you with additional limits of liability over and above both your Homeowners and Auto policies allowing you the peace of mind that your assets are protected.
EXPLANATION OF NAMED PERIL VERSUS ALL RISK
A "peril" is defined as a cause of damage or loss. To be covered for damage or loss under a "basic” contract, the damage or loss must be caused by a peril that is "named" or listed in the contract. Consequently, if damage or loss is caused by a peril that is not named, there is no coverage. In addition, the contract's exclusions must also be considered in determining coverage.
In a "special” contract, it is not necessary to name or list the insured perils since the intent is to cover all risk of damage or loss. Here, too, the contact's exclusions must be considered; however, the "special” form of coverage provides a much greater coverage quality.
Note that "special” coverage should not be construed to mean "all loss" coverage. Certain types of loss are definite and therefore not insurable.
BINDER
A binder is a legal agreement that serves to effect insurance coverage for a specified period of time until the actual insurance policy can be issued. A binder can be issued by either an insurance agent or company and must provide the following information:
  • Name of insured
  • Type of insurance coverage
  • Limits of insurance
  • Covered perils
  • Name of insurance company
BLANKET INSURANCE
Blanket insurance provides coverage under a single limit for the following:
  • Two or more items (e.g., Building and/or Contents)
  • Two or more locations (e.g., Location A and/or Location B)
  • A combination of items and/or locations
BLOCK POLICY
A block policy provides a form of inland marine insurance. It covers loss to the property of a merchant, wholesaler, or manufacturer including:
  • Property of others in the insured's care, custody, or control
  • Property on consignment
  • Property sold but not delivered
A block policy will cover loss caused by most perils (including transportation), subject to certain limitations as specified in the policy exclusions. Common block policies are jeweler's block and furriers block policies.
BOILER AND MACHINERY COVERAGE
This form of insurance provides important mechanical breakdown coverage generally not available under any other insurance policy. A Boiler and Machinery policy can protect an insured against the effects of catastrophic property loss, such as steam boiler explosion or an expensive breakdown of machinery and equipment.
But it's not just the physical damage caused by the explosion or breakdown that's of concern. While repairs are being made, valuable time and profits are lost. Business Interruption coverage protects against this. Often Extra Expense coverage is required to keep the business in operation regardless of cost. Consequential Damage and Refrigeration Interruption insurance protect against spoilage as the result of a breakdown. Many times these business interruption, extra expense and spoilage losses can be much more extensive than the damage to the equipment itself.
Equally important is the very valuable inspection service that Boiler and Machinery insurance can provide. Not only does this service satisfy most jurisdictional inspection requirements, but it also can benefit the insured by providing sound loss control recommendations that can help assure efficient operation and longer equipment life.
It is our opinion that virtually every commercial business has some type of Boiler and Machinery insurance exposure. Keep in mind that mechanical breakdown coverage encompasses much more than just boilers and pressure vessels. It also can include refrigeration equipment, air conditioning equipment, various types of piping, turbines, engines, pumps, compressors, blowers, gearing, shafting, electric motors, generators, transformers and assorted other types of mechanical and electrical equipment. In fact, many policies are written for insureds who do not own or operate boilers or pressure vessels, but yet have sizable mechanical and electrical exposures.
 
BROAD FORM PROPERTY DAMAGE COVERAGE INCLUDING COMPLETED OPERATIONS
This coverage extension is of great value to the general contractor as respects "completed operations" property damage liability claims. Without it, the normal Comprehensive General Liability policy will not respond for "completed operations" claims (i.e., claims rising out of work performed on behalf of the insured by subcontractors). With it, this exposure is covered.
Additional broadening coverage features are also included, but none as important as the above to the general contractor.
BROADCASTERS' LIABILITY COVERAGE
The legal liabilities of a broadcaster are numerous and vary from the use of incorrect news stories, libel and slander, invasion of privacy, copyright infringement, and unauthorized use of plot, characters, or music. Broadcasters' Liability insurance covers these exposures, as well as defense costs in contesting suits or claims. Employees are covered as insured’s while acting within the scope of their duties as such.
BROADENED NAMED INSURED WORDING
Regarding liability coverage’s, these coverage’s will automatically apply to ". . . any affiliated, associated, allied or subsidiary company or entity (including subsidiaries thereof), now held or hereinafter acquired or constituted . . ."
BUILDER'S RISK
Indemnifies for loss of or damage to a building under construction. Insurance is normally written for a specified amount on the building and applies only in the course of construction. Coverage customarily includes fire and extended coverage and vandalism and malicious mischief. Builders risk coverage can be extended to a "special" form as well. The builders risk policy also may include coverage for items in transit to the construction site (up to a certain percentage of value) and items stored at the site.
CAPTIVE INSURANCE COMPANY
A captive insurance company is an insurance company that has been set up to provide coverage at a lower cost than available by going through the general insurance market. The company's stock is controlled by one interest or a group of related interests so as to provide coverage for their business operations. A captive insurance company may be a non-admitted, nonresident, or foreign insurer. Sometimes it may provide reinsurance to a self-insure or a domestic company.
CO-INSURANCE
Co-insurance is an arrangement by which the insured, in consideration of a reduced rate, agrees to carry an amount of insurance equal to a percentage of the total value of the property insured.
An example is if you have guaranteed to carry insurance up to 80% or 90% of the value of your building and/or contents, whatever the case may be. If you don't, the company pays claims only in proportion to the amount of coverage you do carry.
The following equation is used to determine what amount may be collected for partial loss:
           Amount of Insurance Carried x Loss = Payment
            Amount of Insurance that 
              Should be Carried 

Example A

Mr. Right has an 80% co-insurance clause and the following situation:
          $100,000 building value
          $ 80,000 insurance carried 
          $ 10,000 building loss 

By applying the equation for determining payment for partial loss, the following amount may be collected:           $80,000 x $10,000 = $10,000

          -------
          $80,000 

Mr. Right recovers the full amount of his loss because he carried the coverage specified in his co-insurance clause.

Example B
Mr. Wrong has an 80% co-insurance clause and the following situation:
         $100,000 building value
         $ 70,000 insurance carried 
         $ 10,000 building loss 

By applying the equation for determining payment for partial loss, the following amount may be collected:          $70,000 x $10,000 = $8,750

         -------
         $80,000 

Mr. Wrong's loss of $10,000 is greater than the company's limit of liability under his co-insurance clause. Therefore, Mr. Wrong becomes a self-insurer for the balance of the loss-- $1,250.

COMPANY FURNISHED VEHICLES
The Business Auto policy does not extend coverage to employees and their family members if the company furnished vehicle is operated outside the scope of the employer's permission or if the employee rents or borrows a vehicle on a personal basis which is not owned, rented, or borrowed by the business. Also, even in those instances in which coverage extends to the employee under the Business Auto policy, protection is subject to the policy limits, which must be shared with the named insured ( The Employer).
For example, an employer's permission for use of a company vehicle may not extend to employee vacation or other personal activities or to use of the vehicle by members of the employee's family. Even if permission is granted for personal use of the vehicle, the Business Auto policy covers only vehicles owned, rented, or borrowed by the named insured. No coverage extends to vehicles rented or borrowed by an employee on a personal basis.
Individuals who drive a company furnished vehicle must make other insurance arrangements to protect against these coverage gaps in the Business Auto policy. Four alternatives are available:
Expanding the Personal Auto Policy -- Those employees who own one or more personal vehicles in addition to operating a company-furnished car must insure the personal vehicles under a Personal Auto policy. This normally excludes liability and physical damage coverage for the operation of a vehicle furnished for the insured's regular use, but this exclusion may be eliminated by attachment of an Extended Non-Owned Liability Endorsement. This grants coverage for the insured and spouse for operation of a company furnished vehicle and for operating any non-owned vehicle.
Named Non-Owner Coverage -- Individuals who own no personal vehicles may acquire a Personal Auto policy with a Named Non-Owner Endorsement. This provides coverage for the named individual and other listed family members while operating a non-owned vehicle, including a company furnished vehicle. Most carriers prefer not to issue the Personal Auto policy with this endorsement on the presumption that the premium is inadequate; no owned vehicle exists to act as the rating basis.
Expanding the Business Auto Policy -- Those individuals who operate their business as a proprietorship with all vehicles, both personal and business titled in the business name should add the Individual Named Insured Endorsement to the Business Auto policy. This includes family members of the individual named insured as insured’s for the operation of both owned and non-owned automobiles, thus providing the same coverage under the Business Auto policy as is applicable under the Personal Auto policy.
In the absence of this endorsement, coverage still would apply to the individual named insured with the named insured's permission. The recommended endorsement extends coverage to allow family members to operate vehicles owned, hired, or borrowed by the named insured without permission.
Adding "DOC" to the Business Auto Policy -- A final alternative for providing non- ownership coverage for those persons operating a company furnished car is the Drive-Other-Car Endorsement to the Business Auto policy. This includes listed individuals and their spouses as insured’s for the operation of automobiles hired or borrowed by the listed individual.
Depending on premium, coverage applies for liability, medical payments, uninsured motorists, and physical damage. The endorsements should be used when the scheduled

California License #0D80819

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