Welcome to Ibex Insurance

Sometimes insurance terminology can be a little bamboozling so here are some commonly used words and phrases explained
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Ab Initio ("from the beginning")
A breach of a condition, which means that the insurer may be entitled to void the policy from inception i.e., treat the policy as null and void .
The essential relevance of this term is that it highlights the vital importance of submitting accurate responses to Proposal Form questions and of complying absolutely with the terms and conditions of policies. Failures in either area can result in a policy being voided from the beginning and the premium returned to the policyholder .

Accidental damage cover
Insurance that protects against damage to goods rather than loss or theft. Not always included as part of household or motor cover.

Act of God (or Force majeure)
An extraordinary occurrence or circumstance that could not have been foreseen and which could not have been guarded against; an accident due to natural causes e.g. a destructive storm. This term is less frequently used today. See also " Consorcio ".

"All Risks" insurance
A type of insurance that covers all risks - except those not listed under its exclusions .

Annual policy
An insurance policy that applies all year round rather than any other period such as a holiday or car hire period.

Any driver
Insurance that allows anyone to drive a vehicle, not just the owner, so long as they have permission to use the car.

Approved repairer
A panel of repairers, usually throughout the whole country, who the insurance company recommend to repair your car.

Arbitration
A means of arriving at an acceptable agreement between two disputing parties. An independent person or body, often a member of the Institute of Arbitrators, hears the arguments of both parties and makes a decision that is then binding on all concerned.

Association of British Insurers
An association representing some 450 insurance companies which account for over 95% of the business transacted by UK insurance companies. It is also the forum through which UK insurance companies collectively liaise with Government Departments and other bodies and come together to set industry standards and codes of practice.

Beneficiary
The person who is or will be the ultimate recipient of a benefit, such as an insurance payout e.g. a bank, building society or finance company.

Betterment
Betterment occurs where a policyholder takes the opportunity to upgrade the lost/damaged item with a better item e.g. a standard television is replaced with a digital surround-sound television. The policyholder is responsible for the betterment content of the total cost.

Bona fide
A legal term that refers to actions or persons that are honest and in good faith .

Breakdown cover
A policy that provides recovery and repair services for motorists. ARAG, a specialist assistance company provides this cover for Ibex clients who have paid the additional premium due.

Breach
A failure to comply with a policy condition e.g. a security condition.

Broker
An agent who brings two parties together, enabling them to enter into a contract to which he is not a principal. Remuneration is usually calculated as a percentage of the sum involved in the contract but may be fixed according to a tariff.

Buildings insurance
The definition of buildings can vary between one insurer and another. Refer to your Ibex policy booklet .

Burglary
The act of breaking into premises to commit theft .

Carport
A roof that covers a driveway or other parking area, which does not have a door in the manner of a garage.

Caveat emptor ("let the buyer beware")
A maxim implying that the buyer must be cautious, as the risk of ensuring that the goods are as described and in working order is his and not that of the seller e.g. a private purchase of a used car is very much subject to caveat emptor.

Certificate of Motor Insurance
Evidence of the existence of insurance as required by UK Law and needed if you own a UK registered vehicle

Claim
The term used to describe the process of getting an insurance company to pay out on the policy you bought from them.

Commission
The percentage of the premium cost an introducer receives.

Comprehensive cover
The most expensive form of car insurance, that offers the most comprehensive cover. It covers damage to others' cars and to your own as well as losses incurred by fire and theft .

Conditions
Provisions in an insurance contract that state the rights and duties of the insured and of the insurer.

Contract
A legally enforceable agreement between two parties.

Contractual liability
The terms of a contract to which you must abide - failure to do so can incur financial or even criminal penalties.

Contributory negligence
Negligence, by which a person contributes to the happening of an accident to himself, for which others are partially, or even mainly responsible. It was formerly a complete defence to an action for damages to prove that the plaintiff's own negligence was the cause of the accident. Now, the injured person will not be entitled to recover full damages for the injury if it can be shown that, except for his negligence, the accident would not have happened. e.g. the injured party will be regarded as bearing a certain percentage of the responsibility for his accident and the damages awarded would be reduced proportionately (see the definition of Damages later).

Consensus Ad Idem ("agreement on the same thing")
Each party has the same thing in mind when the contract wording was agreed.

Consorcio de Compensacion de Seguros
A public institution in Spain set up to pay claims resulting from extraordinary natural disasters - hurricanes, earthquakes, floods etc. By law in Spain all policy wordings for Home insurance and for Spanish registered vehicles must have a "Clause governing the indemnity of losses caused by extraordinary risks occurring in Spain". The law establishes that when a claim falls within the jurisdiction of the "Consorcio" the insurance company cannot make any payment directly related to the claim. Once notified of a claim, the Consorcio send a " Perito " (Loss Adjuster) to assess the damage and any payment is made directly to the client.

Contents
A definition used in Household insurance to describe "moveable goods and possessions" owned by the policyholder . If you have insured with Ibex refer to your Eurohome policy booklet for the definition that applies.

Contribution
Contribution occurs where two or more Insurers have an interest in the same claim e.g. where dual insurance is held in respect of lost baggage, the policyholder claims against the Travel Insurer and seeks a contribution from the Household Insurer towards the claim settlement or the Travel Insurer pays in full and seeks a contribution from the Household Insurer.
N.B. There are insurance market agreements concerning the method by which contribution is calculated.

Cover
In the context of insurance, cover describes the specific risk a given policy protects you against.

Cover Note
A temporary certificate signed by or on behalf of an Insurer, which grants interim cover whilst proposal form inFormation is considered and full documentation issued.

Damages
The monetary satisfaction awarded by a Judge or jury in a civil action for the wrong suffered by the claimant

Declination
The rejection of an insurance application by an insurance company.

Default
When one insurance premium or a series of premiums are missed, the policyholder can be referred to as being in default.

Deposit premium
The premium deposit paid when an application is made for an insurance policy.

Disclosure
The duty of any person applying for an insurance policy to tell the insurer all relevant inFormation affecting the risk, such as prior claims history. It is also used to refer to the duty of an intermediary to inform his client if commission is being paid (and, if so, how much) in respect of the business being placed.

Effective date
The date on which insurance under a policy will begin.
Endorsement
An amendment of an insurance policy that alters the provisions of the contract.

European Accident Statement
A statement of facts between the two (or more) parties involved in a motor accident. The text of the statement is the same in all language versions thus preventing translation problems.

Excess
The amount of each and every claim which is payable by the policyholder i.e. deducted from the claim settlement.

Exclusions
Events not covered by an insurance policy e.g. allowing drivers other than those specified in the policy to take control of the vehicle.

Ex gratia ("As a matter of favour")
A payment made where none is strictly due, under the terms of the policy.

Expiry date
The time and date on which the cover ceases.

Fault claim
A fault claim is one where your insurance company is unable to recover all of the costs from another party, such as a break in, or an accident that was caused by you.

Fully comprehensive
For motor insurance, a policy that covers damage to the owner's vehicle as well as to others'.

Fraud
The varieties of fraud are infinite, and it has been said that the Courts have never precisely laid down what constitutes fraud, or any general rule, beyond which they will not go in giving equitable relief on the ground of fraud. Fraud is, however, usually divided into two main classes: (i) actual fraud; and (ii) constructive fraud. An actual fraud may be defined as something said, done or omitted by a person with the intention of perpetrating what he must have known to be a positive fraud.
Constructive frauds are acts, statements or omissions which operate as virtual frauds on individuals or which, if generally permitted, would be prejudicial to the public welfare, and yet may have been unconnected with any selfish or evil designs.

Good Faith
A thing is deemed to be done in good faith where it is, in fact, done honestly.

Green card
A document issued to those motoring abroad as evidence that they have the legal minimum insurance cover required. No longer essential for European travel, because minimum legal cover is automatically included in EU policies but nevertheless an essential document to have in Spain as it is recognised by the Guardia Civil that insurance cover has been contracted.

Gross premium
The actual premium paid by the policyholder including insurance premium tax, other local taxes and amounts due for extensions of cover such as ARAG .

Implied terms and conditions
Whilst not specified in a contract, certain terms and conditions can be implied e.g. by Statute and thus become applicable.

Inception
The date the policy commenced.

Indemnity
The principle by which insurance policyholders are put in the same financial position after a loss as they were immediately before it.

Insurance Premium Tax (IPT)
A Government tax charged as a percentage of insurance premiums.

Insurance Ombudsman
A free and accessible means of resolving disputes between policyholders and insurance companies.

Insured car
The insured car as specified by its registration mark on your current schedule, receipt or certificate of motor insurance. Some motor insurance policies insure the vehicle, and some insure the driver.

Insurer
The party to the insurance contract who promises to pay losses or benefits, usually an insurance company.

Intermediary
A person or organisation that offers advice and arranges policies for clients.

Insured Peril
An event which is covered by a particular policy e.g. theft is a fairly standard insured peril in a household policy.

Inter-Alia ("amongst other things")
The policy provides insurance for (inter-alia), loss and damage by theft .

Lapse
The termination of an insurance policy due to non-payment of the premium .

Lapsed policy
A policy terminated for non-payment of the premium .

Leasehold
An interest in land or property that is restricted to a finite period of years.

Limitations ("Statutes of")
Rights to pursue legal actions are subject to a maximum period during which litigation can be initiated e.g. an action for personal injury must be commenced within 3 years, although there are certain exceptions.

Lloyd's
The London-based insurance market organised into syndicates, which underwrite most types of policy. The name is taken from Edward Lloyd who owned the coffee shop in Tavern Street from where the market began in 1689.

Loading
The extent to which an individual is charged more than the "standard" or "average" rate for their insurance. In terms of car insurance, this can be due to a bad claims history, age.

Loss
Insurance people's term for being robbed, burgled , injured or in a car accident. A loss gives rise to a claim .

Loss Adjuster
An independent claims specialist usually employed by the Insurer to impartially investigate the claim and negotiate settlement.
Chartered Loss Adjusters are members of the Chartered Institute of Loss Adjusters and are subject to the Institute's Code of

Main driver
The main driver is the person who uses the vehicle the most.

Market value
The cost of replacing your car with one of a similar make, model, year, mileage and condition, based on market prices at the time of the loss .

Material fact
InFormation that would affect an insurance company's willingness to accept a policy , or the premium it would charge, such as previous driving convictions. Failing to disclose a material fact could invalidate a policy.

MIB
Acronym for the Motor Insurers' Bureau, a body funded by motor insurance companies, which deals with claims for injury compensation when the driver at fault is not insured, or cannot be traced. The equivalent organisation in Spain is Ofesauto.

Motor schedule
A motor schedule is a document that shows details of your policy , excesses , endorsements and premium that is specific to your insurance and should be read in conjunction with your insurer's policy wording.

Misrepresentation
Misrepresentation (i.e. mis-statement of facts) may entitle the Insurer to void the contract e.g. a Policyholder tells the Insurer that the house has a slate roof - whereas in fact it has a thatched roof. Insurers may need to consider whether the misrepresentation was firstly relevant and secondly whether it was innocent or deliberate.

Named driver
A driver specified on an insurance policy who is not the vehicle's owner.

Negligence
An act or omission which results in a breach of a duty of care.

No claims bonus
A no claims bonus (or NCB) is the discount that you have earned on a previous insurance policy. Insurers give discounts determined by the number of years that you have not had claims. The No Claims Bonus must be earned separately on each policy or on each car.

Non-disclosure
An important but previously undisclosed fact comes to the Insurer's attention that may give the Insurer the right to void the policy (see " void ").

Non-fault claim
A non-fault claim is a claim where the insurance company is able to recover all the costs from another party.

Optional extras
Other products available as well as your car insurance, such as breakdown cover.

Over insured
This is where you have taken an insurance policy that covers you for more than you need and as such you will be paying a higher insurance premium than you need to, for instance where the market value of your vehicle has been overestimated.

Owner
The legal owner of a vehicle or property, not necessarily the person who runs, maintains or uses it.

Peril
A term describing an event for which insurance cover is provided for e.g. fire or theft .

Period of insurance
The time covered by the insurance, as shown on your current certificate of motor insurance , schedule and receipt

"Perito"
The name for a Loss Adjuster in Spain

Personal lines
Insurance designed for individuals rather than businesses or organisations.

Personal possessions cover
Insurance for personal items such as money, jewellery and luggage.

Policy
The legal document issued by the insurance company to the policyholder, which states the terms and conditions of the insurance, it may also be called the policy contract or the contract .

Policy booklet
This documentation contains a full list of the terms, conditions and exceptions of your policy .

Policy excess
The policy excess is an amount imposed by the insurance company that you are required to contribute in the event of a claim. The policy excess is frequently increased for younger drivers for accidental damage claims.

Policy exclusions
These are events or instances that are not covered by your insurance policy.

Policy Liability
An obligation to recompense the policyholder under the terms of the insurance contract .

Policy schedule
A document that details how much cover you have (the sum insured) and the premiums you have to pay. With some policies you may get a new schedule when you renew the policy or whenever you want to change your policy.

Policy term
The period of time for which an insurance policy provides coverage.

Policyholder
Person to whom the insurer issues the policy, and normally the person who benefits from any insurance policy.

Precedents
Precedents are legal examples that may be followed. The word is used principally, though by no means exclusively, to indicate one of the two following things: 1. A decision in a court of justice cited in support of any proposition; 2. A prior decision of the House of Lords is binding on all inferior courts, though no longer necessarily upon the House of Lords itself, and nothing except an Act of Parliament can alter it.

Premium
The single or regular periodic payment made to an insurance company in respect of an insurance policy .

Prima Facie ("at first sight")
If the policyholder's home burns down, (at first sight) he/she has a claim under his/her policy since fire is one of the insured perils .

Proposal
Anyone wishing to take out insurance must complete a Proposal. This forms the basis of the contract between the Proposer and the Insurer .

Proposal form
A form used to gather inFormation.

Pro rata ("proportionate")
Proportionately.

Proximate Cause
The proximate cause is deemed to be the primary or dominant cause giving rise to any particular loss . This is not necessarily the first or the last cause in a chain of events.

Quantum ("amount")
How much the Insurer pays for any claim settlement.

Registered keeper
The person who looks after a vehicle, not necessarily the owner. For example, you may use a car that is owned by someone else in which case you would be the registered keeper. Or you may own a vehicle that you allow your children to use and therefore the registered keeper would be one of your children.

Renewal
An agreement to continue insurance beyond any original term .

Representation
Every statement of fact (either verbal or written) that leads to the acceptance of the contract of insurance is called a representation.

Replacement cost
The payment of a claim without any deduction for wear and tear.

Res Ipsa Loquitur ("the facts speak for themselves")
In a given set of circumstances a reasonable person would conclude that the situation must have arisen in a particular way. This will only apply if there is no obvious explanation of how the event has occurred. The onus of proof is transferred to the party, who is or should be in full possession of the facts.

Salvage
Items which formed part of the claim and for which the policyholder has been paid. These damaged/lost/stolen items then become the property of the insurer which is entitled to keep the full proceeds of the sale of any damaged/recovered goods providing the policyholder received the full value of the goods in settlement of their claim .

Schedule
A document describing who is insured, the cover provided and the property insured.

Settlement
When an insurer pays a claim .

Substandard risk
Where the risk of a claim against a policy is higher than average.

Subrogation
Taking over the policyholder 's rights to seek recovery. The recovery is pursued in the name of the policyholder , but the insurer is responsible for any costs incurred in pursuing the recovery e.g. if a negligent motorist damages a garden wall and the household insurer meets the claim for the wall, the household insurer then has subrogated rights of recovery against the motorist.

Sum Insured
The maximum amount payable to the policyholder under the terms of the policy . Alternative accommodation and death benefits are payable in addition to the sum insured, but are subject to their own specific limits.

Term
The period of time for which a policy is issued.

Territorial limits
The geographical limits within which your policy is valid including travel between any of these.

Theft
The basic definition of theft is given in the Theft Act 1968, s 1, which enacts that "a person is guilty of theft if he dishonestly appropriates property belonging to another with the intention of permanently depriving the other of it", it being immaterial whether the appropriation is made with a view to gain or is made for the thief's own benefit. Sections 2-6 of the Act then expand and explain this basic definition by stating what is meant by dishonestly (s2); appropriates (s 3); property (s 4); belonging to another (s 5); and with the intention of permanently depriving the other of it.

Third Party
A person directly involved in the event leading to the claim , but who is not a party to the contract e.g. the policy . An injured passenger would be a third party in the context of a motor claim.

Total loss
When the insurance company decides it is uneconomical to repair your car following an accident, theft , or when your car is stolen and recovered and either it is impossible to repair; it isn't safe to repair; it is not economical to repair your car.

Tracker
A tracker is an electronic device (normally fitted as an accessory after purchase of the vehicle) that emits a signal enabling law enforcement agencies to locate the car anywhere in the EU if it has been stolen.

Uberrima Fides ("utmost good faith")
An insurance contract is one of trust. Both the policyholder and the insurer have a duty to disclose any inFormation that could affect the decisions or actions of the other.

ULR
ULR or Uninsured Loss Recovery is an additional insurance protection that you should consider purchasing. Where a motor accident was the fault of a third party , insurers will attempt to recover your uninsured losses including repair costs, policy excess, transport costs, etc. See ARAG .

Ultra Vires ("beyond the legal power or authority of a person, agent or corporation")
A client tells his broker to place his household business with X insurer , but the broker also places the client's motor and personal accident insurance with the same insurer . The broker was not authorised to do so and in these circumstances would have acted "ultra vires".

Underinsurance
Occurs where the Sum Insured is less than the correct cost/value of rebuilding/replacing the property insured.

Underinsurance Clause
A clause in an insurance policy which provides that where, at the time of a loss , the sum insured is less than the value of the property insured, then the policyholder will be regarded as his/her own insurer for the difference i.e. the settlement is scaled down in proportion to the under insurance by applying the following calculation:
Sum insured* / Value at risk* x Agreed value of claim
(see " Sum insured " and " Value at risk ")

Underwriter
A person who decides whether a risk is insurable and if so at what premium (cost).

Underwriting
Where an insurance company takes into account known facts like your age, sex and health, in order to assess the likelihood of you making a claim on the policy. Your insurance premiums are calculated after taking these factors into consideration.

Underwriting decision
A decision made by insurance underwriters based on evidence supplied.

Utmost good faith
The principle of insurance which requires a proposer to give all relevant inFormation to the insurer.

Value at Risk
The full value of all property, which could form the basis of a claim under a policy . What the value needs to be based upon will vary according to the type of cover e.g. if cover is on a new for old basis, value at risk should be calculated on the same basis.

Void and voidable
Null and void e.g. where a policy can be treated as though it never existed due, for example, to a material non-disclosure.

Warranty
A condition of a policy which must be complied with for cover to operate.

Without prejudice
An enquiry, proposal or offer of settlement made without admission of liability. The words are used either verbally or in writing to protect against an admission being implied.

Write-Off
When the insurance company decides it is uneconomical to repair your car following an accident, theft , or when your car is stolen and recovered and either it is impossible to repair; it isn't safe to repair; it is not economical to repair your car.