Umbrella Policy

More claims & insurance terms

• Third-Party Administrator

  A company hired to run claim handling for a carrier or an employer, such as a warranty program or a managed repair network. The person reviewing your supplement may work for the administrator, not the carrier on the policy, and their guidelines can differ. Ask who actually has authority to approve the added work.

• Total Loss Determination

  A decision that repairing the property no longer makes sense, so the claim is settled as a total loss rather than a repair. The threshold differs by policy and by state, so do not assume a fixed percentage. After the declaration, the settlement usually follows the policy limit and coverage form, not the repair estimate.

• Umpire

  An umpire is the neutral third party chosen when you and the insurer each pick an appraiser and those two cannot agree. The umpire decides the disputed amount with them, and because the choice is usually made by the two appraisers or a court, agree on who picks and who pays before you start.

• Underpayment

  An underpayment is a claim payment that covers less than the scope of work you can document, whether from missed line items, wrong quantities or a pricing difference. The fix is evidence: photos, measurements and code or manufacturer requirements tied to specific line items, then a written request for the difference.

• Valued Policy Law

  A valued policy law is a state rule that, in a total loss, requires the insurer to pay the policy limit for the insured structure instead of the actual cash value. Only some states have one, most apply it to a total loss of real property and in many states only to fire losses, and the details differ - so check your state's rule and the policy before you rely on it.

• Water Damage

  Water damage is loss caused by water entering where it should not, from a burst supply line, a roof leak or a storm, and it often shows as staining, swelling or soft drywall. Document the source and moisture readings, since carriers generally pay for the resulting damage and drying. Whether the failed pipe or fitting itself is covered turns on the cause and the policy, so read the exclusion before you promise it.

Common questions