A person appointed either by the insurance company or insured to assist in claims verification and settlement, so that a claim can be settled expeditiously for the mutual benefit of both parties.

Act of God

Natural occurrence outside human control such as earthquake, volcanic eruption, flood or typhoon. These occurrences may be specifically included in most insurance policies with a premium.

All Risks Coverage

A term generally reserved for reference to valuable items such as jewelry, artifact to insure against fire, lightning, theft accidental damage and named perils.


The recipient of the contractual benefits from an insurance policy which is a Benefit type policy. Example of such a policy is a Personal Accident Insurance policy.


A broker would represent the interests of the clients and negotiate the appropriate cover to their needs. A broker provides service in a professional manner in line with guidelines stipulated by the Broker Association.


It refers to theft which involves forcible entry or exit to a property or premises. For example, loss will be admissible in a Burglary Policy in the case of a break-in through access of door, window or roof.

Consequential Loss

Another term for Business Interruption or Loss of Profits. Insurance cover for loss of revenue, profit and related cost following a material damage.

Contingent Liability

This refers to liabilities incurred by one party as a result of the actions of another party or their employees i.e. a developer would be liable for the negligent acts of their contractor or sub-contractors under their direction or control.

Contractor's All Risks

Insurance covering contract works undertaken in the course of construction and engineering projects on an All Risk arrangement. The policy includes Public Liability and is invariably arranged in the joint names of the Principal and Contractors or Sub Contractors.

Double Indemnity

The double payment of a specified benefit in a Personal Accident policy upon the happening of certain predefined incidents.

Date of Issue

The date from which the insurance policy is actually issued and is not the date the insurance is contracted to commence.


This offers compensation for a disability resulting from an accident or serious injury under a Personal Accident policy. Serious injury may cause you not to be able to perform normal work and insurer will pay a lump sum of compensation.

Employer's Liability

Workmen’s Compensation Acts provide for the payment of compensation monies to employees who may be injured as a direct result of their job. However, employees have a common law right to sue their employer for negligence, for example failure to provide a safe system of work. So it is advisable for employers to extend the Workmen’s Compensation Policy to include Employer's Liability cover.

Engineering Insurance

Insurance which relates to all forms of plant, mechanical and electrical equipment which are assets subject to Maintenance, Breakdown, Explosion and Collapse.

Erection All Risks

Insurance specifically refers to erection, installation, testing and commissioning of plant. The policy has a provision to include Public Liability cover.

Fidelity Guarantee

Insurance protection against a fraudulent or dishonest act by an employee.

Fire Policy

The standard Fire policy covers fire, lightning and explosion of gas used for domestic purposes only. It is prudent to make sure you also include full Additional Perils cover available at additional premium which includes full explosion, damage by aircraft & vehicles, storm, flood, earthquake and others.


An Additional Peril in a standard Fire policy, which is available at additional premium. It is subject to a small excess, that is, the insured pays the first agreed amount of loss.

Household Insurance

Insurance to cover household and specified contents, valuables kept at the premises against Fire, Lightning, domestic explosions, theft following forcible and violent exit & entry, liability which is package for dwelling risk.


This is a principle of insurance according to which an insured when being compensated for a loss should be placed in the same financial position as he was before the loss.

Industrial All Risks

For large Industrial risk with sum insured exceeding RM50 million, the insured may be allowed to insure broad cover beyond the standard Fire and Additional Peril. For example, it includes Burglary and Accidental Damage, with specific exceptions.

Knock for Knock Agreement

In Motor Insurance, it frequently happens at an insured can make a claim under his policy or recover from a negligent third party. The usual procedure is for a claim to be made against its insurance company which will then pursue recovery under subrogation rights. To simplify recovery claims among insurers, in the Motor Tariff provision there is an inter-company agreement whereby each insurer pays the vehicle's repair costs of its own policyholder.

Legal Liability

Obligations and responsibilities subject to evaluation and enforcement in a court of law. Public, Products and other Third Party Liability insurance would normally only cover your Legal Liability for civil actions plus costs expended to defend an action.

Liability Insurance

An insurance policy that provides cover for Legal Liability to third parties, including legal costs. Public and Product Liability Insurance are the most common forms.

Market Value

The price at which an item or property can be bought or sold at any particular time.

Named Drivers

Specific to Motor insurance, the coverage is restricted to the drivers named in the policy. For any authorised drivers, with the permission of the named driver, the Motor Insurance will impose an additional excess in the event of a claim under the policy.

No Claim Discount

A reduction in premium in subsequent year of insurance as a result of the insured holding a Motor Policy during the insurance period without making any claim. There is a scale discount stipulated by the Motor Tariff to encourage the policyholder to have a good claim experience.

Own Damage

Under a Comprehensive Motor Insurance policy, this phrase refers to the accidental damage cover on your own vehicle. In the case of collision of motor vehicle or accident, where the vehicle sustains damage, insurer will compensate the insured by paying for repairs, by replacing the car or by making cash payment. Policy will exclude losses related to wear and tear and breakdown of the vehicle.

Personal Accident

A policy which provides compensation to the insured or his beneficiaries against losses resulting from an accident and resulting in death, or permanent disability such as loss of an eye or limb as described in the policy Scale of Benefit. A Personal Accident policy is not a Contract of Indemnity and the sum insured allowed by an insurer ensures it is commensurate with the insured’s earning capability, type of occupation or work, and engagement in extra activities.

Personal Liability

This is insurance which affords protection against a claim resulting from an inadvertent or unintended action of the insured, such as causing bodily injury to a third party person when opening the door of a motor car without first checking the surrounding area.

Public Liability

Insurance provided to insured as protection against legal liabilities for bodily injury to third party or loss of or damage to property belonging to third party.

Reinstatement Value

The cost to replace insured property at costs prevailing at the time of loss without any deductions for depreciation and wear and tear.

Renewal Notice

A notification provided by the insurer to the insured advising them that the policy will be expiring and of the premium for the renewal. The insured will reply to the insurer regardless of changes i.e. revised sum insured or at same renewal terms.

Short Period Rate

A premium cost charged in accordance to the time for which insurance is required, usually for periods ranging from one (1) week up to eight (8) months.


This is a policy condition that gives an insurer the right to seek recovery for a loss that has been paid from an identified party who is at fault.

Third Party Cover

This coverage provides protection against the standard 'Act' cover as well for damages caused to third party vehicles.

Temporary Disablement

Benefits payable under Personal Accident policies where disability is short-term, such as not being able to work as a result of the injury sustained in an accident.


Commonly defined as use of violence for political ends. The term “terrorism” usually also includes any violence intended to put the public in a state of fear. Property and Liability Insurance have the Terrorism Exclusion incorporated.

Theft Insurance

Theft insurance on business premises usually limits cover to incidents involving forcible or violent entry to, or exit from, the premises. A wider form of cover is available, known as Full Theft Cover, which waives this restriction and is available for certain trades with good loss ratio. Theft insurance is arranged only after the insurer assessed the facts in a proposal form or sometimes in addition a Theft Survey is conducted.


Claims are much more easily and satisfactorily handled if you have valuations. With buildings, of course, you have to look at rebuilding costs rather than market value and the use of professional valuer to keep valuations up to date.

Valued or Agreed Value Policy

The value in a valued policy is agreed during negotiations to conclude the contract. This is available to collectors for fine arts or vintage cars for example.

Waiting Period

In the case of Health Insurance, this refers to the period of time specified in the policy which must be allowed to elapse before benefits would become payable by the insurance company.