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Onlia's Glossary of Insurance Terms

As we strive to simplify insurance, here’s a quick guide to some of the insurance terms that you may run into.

by Team Onlia

Insurance jargon isn't always easy to understand. Unless you're an expert in the industry, some of the commonly-used insurance terms you'll encounter can be complicated and confusing.

Whether you’re shopping for insurance or simply perusing your policy to review your coverage, it helps to have an understanding of the unique insurance terminology you’ll see. Here’s a list of some popular insurance terms to help you get familiar:

Accident Forgiveness

Accident forgiveness means your insurer will not increase your rates after your first at-fault car accident. In such an event, when your policy renews, your premium will not be impacted based on that accident. Your rates might increase for other reasons, but the claim for your first at-fault accident will not impact your rates.    


A person with advanced mathematical skills who compiles and analyzes data and statistics to calculate insurance risks and premiums.


An employee at the insurance company, or affiliated with said insurance company, who investigates a claim and negotiates a settlement with the claimant on the company's behalf.  


A document that acts as temporary proof of insurance. A binder is evidence of the insurance policy that the customer purchased. An insurance provider can issue a binder when proof of insurance is required before policy documents are ready.

Bodily Injury

A term used in auto and casualty insurance policies, bodily injury means a person’s body was injured. If an incident causes someone physical pain, illness or death, they’ve suffered bodily injury. 


A marketing technique commonly used by insurance companies. Insurers often offer discounts to customers who purchase two or more types of insurance from the same insurance company. For example, Onlia customers can enjoy a 15% discount on car insurance and a 20% discount on home insurance if they purchase the two policies from Onlia. 

Car Insurance

In order to legally drive an automobile in Ontario, all automobile owners must purchase car insurance to protect them from financial losses that may come with any potential accidents. Car insurance can help protect policyholders if they’re found to be responsible for an accident that causes damage to another person or their automobile.   


A request for indemnification made under an insurance policy either by an insured policyholder, or a third party against an insured person, as a result of a fortuitous event.

Collision Coverage

Car insurance coverage that helps repair or replace your car in the event you collide with another car or object, or if you’re involved in a single-vehicle accident, such as hitting a tree. 

Comprehensive Coverage

Car insurance coverage that includes protection for damage or loss due to theft, vandalism, fire and more.

Condo Insurance

An insurance policy that protects your condo unit, and everything inside of it, from damage and/or theft. From fire and water damage to theft and break-ins, condo insurance covers the cost to repair or replace your property so that you don’t have to.

Condo insurance is required in order to purchase a mortgage for your condo — banks and mortgage lenders in Ontario require that you have insurance before approving a mortgage loan.

Cottage Insurance

Also known as seasonal Insurance, cottage Insurance protects your seasonal property, and everything inside of it, from damage and/or theft. Cottage Insurance coverage can vary based on the type of coverage purchased by the policyholder.  


Coverage is the protection that your insurance policy provides. An insurance policy can consist of several types of coverages, it all depends on which ones you select to complete your insurance policy.  

Covered Loss

Also known as a “covered peril,” a covered loss is a financial loss due to an incident that is covered in your insurance policy. This means you can file a claim and seek reimbursement from your insurance provider. 


The portion of your insurance claim that you are required to pay before your insurance kicks in to cover the rest. 

For example, if you have a policy with a $200 deductible and you suffered a covered loss totalling $800, you would be required to pay the first $200 before your insurance provider covers the remaining $800. Deductibles typically apply only to at-fault insurance claims, where you were found to be at fault for the incident that led to the claim, but deductibles can apply to certain non-fault claims as well. 

Deductibles can be used to lower the cost of your insurance premium. If you choose a higher deductible, you would be paying less in your premium, but you’ll be required to pay more if/when you file a claim. On the flip side, if you were to choose a lower deductible, you would be paying more in your premium, but less when you file a claim. 


An amendment to an insurance policy that is used to add or remove coverage, or to make a simple amendment, such as a policyholder changing their address. This is also commonly referred to as a “Rider.”   

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Home Insurance

An insurance policy that protects your property, your home, and everything inside of it. Home insurance isn’t legally mandatory in Ontario, but most mortgage lenders require that you to have it before getting a mortgage. 

Landlord Insurance

Insurance coverage that protects your rental property, third-party bodily injury, physical damage and repairs, as well as loss of net rental income. Landlord insurance isn’t mandatory in Ontario, but most lenders require it if you have a mortgage.


Insurance that protects you from legal action in the event you and/or your business are responsible for causing injury and/or damage to other people or property. 

Occasional Driver

Someone under the age of 25 who lives in your home and drives your insured automobile now and then, but not regularly. 


An event or circumstance that results in property damage. Your homeowners, condo, tenant or renters insurance policy should contain a list of covered perils, such as fire, flooding, and vandalism.

Personal Injury

A type of insurance that lets people get compensated for injuries and/or damages faced due to someone else’s recklessness or negligence.

Pink Slip

A small document that acts as your proof of auto insurance. Drivers in Ontario must be able to provide proof of insurance when they are driving their insured vehicle. Once you’ve purchased an auto insurance policy, your insurer will send you either a paper or digital pink slip as your proof of insurance. 


A formal document containing details of the insurance coverage that you’ve purchased. 


A customer who has purchased an insurance policy from an insurance company. 

Policy Limit

The highest amount your insurer will pay for a claim that is covered by your insurance policy.


The amount of money you or your business pays for an insurance policy. 

Primary Driver

The person who regularly drives the insured automobile. Every car insurance policy is assigned a primary driver and the premium is calculated on that person's driving history, which includes any traffic tickets or accidents the primary driver may have experienced.

Property Insurance

Insurance coverage that provides protection against most risks to property, such as fire, theft, and weather damage. This coverage includes home insurance, condo insurance and tenant insurance.


The expiration, and potential renewal, of an insurance policy. Most insurance policies have a policy period of one year, during which the insurance provider cannot make changes to the premiums or coverage (except in special circumstances). Most auto insurance policies will automatically renew after one year, unless you have informed your insurance provider that you do not wish to renew ahead of the policies expiration date. 

Replacement Cost

The cost to replace lost or damaged property with a new item that is of similar kind and quality to the original item. The “item” can be anything from a bicycle to a house, depending on what was damaged/stolen and which type of insurance you have.

Secondary Driver

Someone who is 25 or older who lives in your home and drives your insured automobile now and then, but not regularly. 

Tenant Insurance

Also known as “renters insurance,” tenant insurance offers financial protection if the things in your rented home are damaged or stolen. It’s not mandatory in Ontario, but some landlords will require that you have tenant insurance to rent a place.

Ticket Forgiveness

An optional auto insurance coverage that ensures your insurance provider will not increase your premium over a minor conviction. This insurance coverage is free for all eligible drivers who purchase an auto insurance policy with Onlia Insurance.

Total Loss

Also known as an “actual total loss,” total loss occurs when an insured property is totally destroyed, lost, or damaged to the point that it cannot be fixed or recovered. 


An employee of an insurance company who evaluates risks and determines the rates and coverages that will be used for them.


The process of evaluating a risk and issuing insurance coverage on it.

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