Insurance Terms and Abbreviations


For this week’s post, we thought it would be helpful to list and explain some insurance terms and abbreviations that are commonly used.  If there are any that you have come across that you don’t see here, please let us know and we’d be happy to define them for you.


ACV – Actual Cash Value

The fair market value of a property, taking into account factors that might augment or reduce the value of the property in question (i.e. depreciation).



Reduction in value of a property through use, age, deterioration, and obsolescence.


RC – Replacement Cost

Repairs or replacement will be made with material of like kind and quality without cost to the insured for depreciation or betterment.


GRC – Guaranteed Replacement Cost

The cost of repairs or replacement will be made to the dwelling, on the same site, even if they are more than the principal dwelling Replacement Cost amount shown on your policy Coverage Summary page, provided:

  • Value of dwelling is not less than 100% of the cost to replace, as determined by an approved valuation guide
  • Principal dwelling amount is not reduced below that determined by the valuation guide
  • Notification is made within 90 days of the start of any work, improvement, extension or addition to the dwelling which would increase the Replacement Cost by $10,000 or more


SEF – Standard Endorsement Form

These Endorsements can be added to an Automobile Insurance policy and serve the purpose of either adding or removing coverage from the policy.


SPF – Standard Policy Form

The form under which Automobile Insurance policies are written.  Some of the most common SPF’s are:

  • SPF #1 provides coverage for owners of vehicles
  • SPF #2 provides coverage for drivers who are driving vehicles they do not own
  • SPF #4 is a Standard Garage Automobile Policy and provides coverage for garages in respect of owned, non-owned, and customer’s vehicles
  • SPF #6 is a Standard Non-Owned Automobile Policy Coverage and applies to a business entity when the business and its owners could be held legally liable for damages caused by a vehicle that they do not own


Ded – Deductible

An agreed specified sum to be deducted from the amount of the loss and assumed by the insured.



The event that caused the loss or damage (i.e. fire, wind, hail)


PLPD – Personal Liability and Property Damage

Indemnifies the insured (and every other person who with his consent personally drives the automobile, or personally operators any par thereof) against the liability imposed by law upon the insured or upon any such other person for loss or damage arising from the ownership, use or operating of the vehicle.


Coll – Collision

The Insurer agrees to indemnify the insured against direct and accidental loss or damage to the automobile, including its equipment from Collision with another object or by upset.  “Another object” is deemed to include a) a vehicle to which the automobile is attached b) the surface of the ground and any object therein or thereon.


Comp – Comprehensive

The Insurer agrees to indemnify the insured against direct and accidental loss or damage to the automobile, including its equipment from any peril other than by collision with another object or by upset.


AP – All Perils

The Insurer agrees to indemnify the insured against direct and accidental loss or damage to the automobile, including its equipment from all perils.


SP – Specified Perils

The Insurer agrees to indemnify the insured against direct and accidental loss or damage to the automobile, including its equipment caused by fire, lightning, theft or attempt thereat, windstorm, earthquake, hail, explosion, riot or civil commotion, falling or forced landing of aircraft or parts thereof, rising water, or the stranding, sinking, burning, derailment or collision of any conveyance in or upon which the automobile is being transported on land or water.


NP – Named Perils

A policy in which the perils insured against are listed, as opposed to one which insures against “All Risk”.


All Risk

A policy which covers against the loss caused by all perils except those which are specifically excluded by the terms of the policy.


Fire & E.C.

One of the more limited fire insurance policies, commonly providing coverage for loss or damage caused by fire or lightning, explosion, smoke, falling objects, impact by aircraft, spacecraft or land vehicle, riot, water damage, windstorm or hail, and vandalism or malicious acts.  This type of coverage is common for rented dwellings and some seasonal properties.



Provides All Risk coverage on the dwelling and detached structures, but Named Perils coverage on the personal property.



The most comprehensive (hence its name) fire insurance policies, providing All Risk coverage on the dwelling, detached structures, and on the personal property.


App – Application

A request for insurance which may be done verbally, in writing or by using a printed form.


PAC – Pre-Authorized Chequing

An authorization to allow the Insurance Company to automatically withdrawal insurance payments from a banking account.


Credit Score

A numerical point system based on select credit report characteristics. Insurance scores are not intended to measure creditworthiness, but rather to predict risk. Insurance companies use these scores to make underwriting decisions and to partially determine premiums. The scores are currently being used by only some Insurance Companies, and typically with respect to personal property and personal automobile policies.


ITV – Insured to Value

In order for GRC (Guaranteed Replacement Cost) to apply, an insured’s home must be insured to 100% of the Replacement Cost as calculated by an approved valuation guide.  It must be “Insured to Value”.  There are several different approved valuation tools available, which provide accurate and current statistics about a property, and allow us as Brokers to calculate the correct Replacement Cost value.  The Replacement Cost value is different than the current market value or tax assessment value of the property.


Hopefully you have found this information helpful.  As always, please do not hesitate to contact our Office if you have any questions regarding the above information or if we can assist you in any way!


Thank you,

The Costen Insurance Team