Glossary of Insurance Terms

D

Daily - The document - now more commonly found in electronic than in paper form - that provides insurer and agent with a quick reference to all pertinent information relative to a contract of insurance: insured’s identification, location, coverage, term, premium, and so on. Sometimes referred to as a "daily report."

Data processing insurance - Coverage for electronic media, computers, and other electronic data processing equipment.

Deadheading - A trucking term that means the driving of a tractor-trailer that is empty, usually on the return trip from delivering goods. A special trucking endorsement, Truckers Insurance for Non-Trucking Use, may be necessary when deadheading.

Debris removal clause - A consequential coverage commonly included in direct loss policies. For example, fire policies provide limited recovery for the insured’s cost of removing the debris after a covered fire. Not to be confused with removal.

Declarations page - That part of a property or liability insurance policy that discloses information pertinent to the coverage promised including names, addresses, limits, locations, term, premium, forms, and so on. The same information, perhaps in a shorthand version, is contained as well in the daily.

Deductible - The part of the loss that is to be borne by the insured.

Demolition insurance - When a building is damaged beyond a certain point, say 50% destroyed, local building codes may direct that the structure be razed. Insurance to cover this exposure (and the lost value of the undamaged but newly razed part) can and clearly should be arranged whenever it exists. Increased cost of construction coverage to meet current building codes should be provided as well.

Dependent properties, see Business income, dependent properties.

Deposit premium - When the price of insurance is tied to fluctuating values or costs that cannot be known until the end of the policy period, inventory or payroll are two common examples, a deposit or provisional premium or estimated premium may be charged at the outset of a policy with final adjustment to come at the end of the term.

Depositor’s forgery insurance - Coverage against loss due to forged checks, notes, etc. Limited coverage is automatically included in homeowners contracts. Commercial establishments can purchase crime coverage with this feature.

Depreciation - As property ages and becomes worn it often loses value. That loss of value must be taken into account in any adjustment of property insurance that covers loss of actual cash value.

Difference In Conditions (DIC) - Property insurance obtained through the excess and surplus lines market to supplement and expand on the property coverage available through admitted markets. DIC has been called the "property umbrella" policy.

Direct damage - Physical damage caused to property by a peril such as fire or lightning.

Direct loss - The immediate consequence of the action of an insured peril. A fire-damaged structure is a "direct loss" by fire. In contrast, see Consequential loss.

Direct premiums - Premiums collected from policyholders before premiums for reinsurance are paid.

Direct writer - An insurer that sells coverage directly via its own employees. Contrast with independent agent.

Directors and officers liability insurance - A form of errors and omissions insurance covering the directors and officers of corporations against suits alleging they committed wrongful act(s).

Discovery period - The period of time, commonly one year, after the termination of a surety bond during which covered loss may be discovered, reported, and covered.

Dishonesty, Disappearance, and Destruction ("3-D") policy - The name once applied to a form used for comprehensive crime coverage. Now known as ISO Form C.

Dram shop laws - State laws pertaining to selling and serving alcoholic beverages and the public liability these activities may entail. Also called alcoholic beverage control (ABC) laws.

Dram shop liability insurance, see Liquor liability insurance.

Drive Other Car (DOC) endorsement - A business auto or garage policy endorsement providing coverage for named individuals while driving nonowned autos in situations unrelated to the business of the insured.

Druggists liability insurance - A form of professional liability insurance for druggists.

Duty to defend - Part of the insuring agreement of many policies. The insurer has the duty to defend the insured in event of a covered loss.

Dwelling forms - Forms for coverage of dwellings and personal property that are not eligible for homeowners coverage. Tenant occupied rental properties are commonly insured under these forms.