Glossary of Insurance Terms 


For most of us, our cars are one of the biggest investments we make and to experience a loss could be financially devastating. Auto insurance can cover more than just the repairs on your vehicle. Depending on the coverage you choose, your insurance can:

  • Cover medical expenses associated with an accident

  • Pay for losses caused by underinsured or uninsured drivers

  • Reimburse you for damages suffered because of vandalism, natural disasters or theft

  • Pay for legal representation in case of a lawsuit

Figuring out which coverages make sense for you can be confusing. That’s why it’s important to discuss your needs with a Richards Group agent who can recommend coverages that are right for you and help identify whether you qualify for any of the auto discounts we have available.

Your house is more than four walls and a roof. It can provide you with financial security. And, it's probably your biggest investment. Inside those walls are possessions and valuables that make your house a home—and those items need protection as well. 

A standard homeowners policy safeguards your home and possessions against:

  • Sudden and accidental damage from electrical current

  • Fire and lightning

  • Windstorms and hail

  • Explosions

  • Smoke damage

  • Freezing

  • Theft

  • Glass breakage

  • Falling objects

  • Weight of ice, snow or sleet

  • Accidental discharge of water or steam

  • Vehicles

  • Vandalism and malicious mischief 

  • Homeowners insurance doesn't only apply to those who own a single-family house. If you own a condominium, have combination dwellings, rent an apartment or if you have a second home, you can also buy insurance specifically designed for your circumstances.

One policy provides both property and liability coverage for dwellings not eligible for a homeowners policy. All coverage options track with the homeowners policy, making it easier to use individually or in combination with homeowners coverage.

If you rent an apartment or own a condominium, you need insurance to protect your belongings. While your landlord or condo association might have insurance, it only protects the building. Your belongings are not covered under those policies.  There are several types of residential insurance policies. The HO-4 policy is designed for renters, while the HO-6 policy is for condo owners. They both cover losses to your personal property.

Vacation homes require a special type of insurance--one that protects your vacation home but doesn't overlap with your already existing homeowners insurance coverage. Most homeowners insurance policies provide limited coverage for personal property at an additional residence. However, if your coverage needs for your vacation home exceed this amount, you're going to want to fill this gap by purchasing a policy that will cover your vacation home in its entirety. One way to do this is to purchase a dwelling fire policy, which is specially designed for a second home in that it provides coverage for the dwelling itself, along with your personal property. In addition to protecting your home and its contents, we also offer several discount programs to those that qualify. 

Umbrella liability coverage protects you from financial catastrophe due to lawsuits. It offers additional protection above and beyond your standard homeowners and auto policy limits and helps eliminate any gaps in your coverage. This type of policy can help ensure you are safeguarding your possessions, savings, and your future earnings.

Just like personal auto insurance, motorcycle insurance offers similar property and liability coverages. 

Watercraft insurance policies provide coverage for physical damage caused by a collision, fire, theft, windstorm, lightning, vandalism, and others. This coverage is broad and often includes machinery and auxiliary equipment, outboard motors, boat trailers and other personal property. Additional coverages are available as well, such as Personal Effects, Boat Liability, Medical Payments and Commercial Towing and Assistance.

You want the world for your family, now and even when you're gone. Make sure you plan for their future. It's important you have adequate life insurance to protect them if the worst happens. The Richards Group has life insurance plans that will help your family pay off the mortgage, send children to college or secure your spouse's retirement years should something happen unexpectedly.   


Property insurance pays for losses and damages to real or personal property. For example, a property insurance policy would cover fire damage to your office space. 

In today's litigious society, even small mishaps can result in large lawsuits. That's why general liability insurance, along with property and worker's compensation insurance, are essential for most companies. Liability insurance protects the assets of a business if it becomes involved in a lawsuit. Other coverage for premises and operational liability, medical payments and contractual liability are also included. General liability insurance can be purchased separately or as part of a business owner's policy.

Boiler and machinery insurance, sometimes referred to as "equipment breakdown" or "mechanical breakdown coverage," provides coverage for the accidental breakdown of boilers, machinery, and equipment. This type of coverage usually will reimburse you for property damage and business interruption losses. For example, this coverage would cover fire damage to computers.

Debris removal insurance covers the cost of removing debris after a fire, flood, windstorm, etc. For example, if a fire burns your building to the ground, the remains of the old building have to be removed before you can start rebuilding. Your property insurance will cover the costs of rebuilding, but not of removing the debris.

Builder's risk insurance covers buildings while they are being constructed. For example, a Builder's risk policy would cover losses if a windstorm takes down your partially constructed condominium complex.

Business interruption insurance covers lost income and expenses resulting from property damage or loss. For example, if a fire forces you to close your doors for two months, this insurance would reimburse you for salaries, taxes, rents, and net profits that would have been earned during the two-month period.

Ordinance or law insurance covers the costs associated with having to demolish and rebuild to code when your building has been partially destroyed (usually 50 percent). For example, your three-story building is 100 years old. A flood destroys the basement and first two stories. Because more than 50 percent of your building has to be rebuilt, a local ordinance requires that the building be completely demolished and rebuilt according to current building codes. Property insurance covers only the replacement value, not the upgrade.

Commercial leases often require tenants to carry a certain amount of insurance. A renter's commercial policy covers damages to improvements you make to your rental space and damages to the building caused by the negligence of your employees.

Errors and Omissions (E&O) insurance covers inadvertent mistakes or failures that cause injury to a third party. The act must actually be an inadvertent error, and not merely poor judgment or intentional acts. For example, an E&O policy would cover damages arising from an accountant failing to file the appropriate tax documents, or a notary filling out notarizations improperly.

Malpractice insurance, or professional liability insurance, pays for losses resulting from injuries to third parties when a professional's conduct falls below the profession's standard of care. For example, if a doctor makes a mistake that other doctors of his specialty would not have made, his patient might sue him. A malpractice policy will pay his defense costs and any judgment or settlement. Malpractice insurance is available for doctors, dentists, accountants, real estate agents, architects, and other professionals.

A Commercial Umbrella policy protects you against a loss due to catastrophic lawsuits by providing business liability coverage above and beyond your basic standard liability policy. Your business can be covered for $1,000,000 up to $10,000,000 or even more in special cases.

Employment Practices Liability provides protection against the risks related to discrimination claims, workplace harassment, wrongful termination or other employment practices.

This type of insurance is generally purchased by corporations and nonprofit organizations to cover the costs of lawsuits against directors and officers.

Commercial automobile policies cover the cars, vans, trucks and trailers used in your business. The coverage will reimburse you if your vehicles are damaged or stolen or if the driver injures a person or property. If your business owns a car or truck, or a fleet of vehicles, you need Commercial Automobile Insurance. 

Workers Compensation Insurance pays for medical care and physical rehabilitation of injured workers and helps to replace lost wages while they are unable to work. It may also provide benefits for dependents of those workers who are killed because of work-related accidents or illnesses.

An employee benefits plan can be customized to fit the needs of your business and your budget. We can develop a comprehensive program that offers the coverage you need to stay competitive and attract the best employees.