Home Insurance Terms You Need to Know, Part One | Blog | Vargas & Vargas Insurance

When it comes to your home, proper home insurance coverage is vitally important. However, insurance terminology can make reading a quote or policy feel like reading a foreign language. Without understanding home insurance terms, you could find yourself with far less coverage or far different coverage than you thought. Vargas & Vargas Insurance is committed to making sure you have the knowledge you need to make the right insurance decisions regarding your home insurance. 

General Home Insurance Terms

Declarations (Declarations Page)

This refers to the page of your policy that gives your basic information, including the name and address of the insurance company, coverage to and from dates, basic coverages, deductible, premium, and any additional interests. It’s an overview of your policy and is often what your mortgage company will ask for to show proof of coverage. 

Insured/Insurer

The insured is the person that coverage is being provided for—generally, the owner of the home. The insurer is the insurance company providing the coverage for your home. 

Additional Insured

The declarations page will list the additional insured, along with the insured. The additional insured is anyone else, other than the homeowner, who has a legal interest in the home. The most common additional insured for a homeowners policy is the mortgage company. An additional insured will be notified of the policy renewal and if the policy is in danger of cancellation. They may also be payees on larger claims checks. 

Policy Period

This is the time period your home is currently insured for, which is usually one year. Most homeowners insurance policies renew automatically, assuming the premium is paid. 

Premium

The annual amount you pay for your homeowners insurance is the insurance premium. This premium can come in convenient payments of monthly, quarterly, or semiannual installments. Typically, homeowners pay it directly to the insurance company through a mortgage escrow account. 

Deductible

The deductible is the amount the insured (homeowner) is responsible for in the event of a claim. If a claim is less than the deductible amount, the insurance company bears no responsibility for payment of the claim. If the claim is more than the deductible, the deductible will be subtracted from the claim’s total amount before the insurer pays out. The deductible is not paid to the insurance company. 

All-Risk/Named-Peril

An all-risk insurance policy covers all potential causes of loss other than the ones specifically excluded in the policy. A named-peril policy covers the causes of loss specifically listed in the policy and no others. While an all-risk policy can be more inclusive, it is generally much more expensive and not as common. Most insurers choose to cover the most common risks, providing a broad scope of protection while keeping premiums affordable. 

Replacement Cost Value (RCV)/Actual Cash Value (ACV)

When you purchase your home, the sales price is based on the market value of your home. The price depends on the desirability of the location and many other factors. When you have a loss, however, the location’s desirability has no bearing on the cost to rebuild your home or replace your roof. That’s why it is important to understand the difference in replacement cost and actual cash value.

The replacement cost value is the cost to replace a damaged item or item, whether it be your TV or your roof. The actual cash value takes into account the depreciated value of the item. If your roof is ten years old, you got ten years’ worth of value from your roof, so a deduction is taken from the amount paid for your claim to account for the age of the roof. Knowing which type of coverage you have before a claim can prevent many misunderstandings during the claims process.

General home insurance terms are important to know, but there are many more terms that can make all the difference in understanding your home insurance. For more insurance terms, see the second part of our series on Home Insurance Terms You Need to Know .  

Vargas & Vargas Insurance is a premier local independent insurance agency. We work for our clients, not the insurance company. We will customize your insurance coverage to your specific needs at the right price and are here to answer all of your insurance questions. Contact us today.

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What Happens to My Auto Insurance After a Hit & Run?

By carlos vargas • November 21, 2025
If someone hits your car and drives off, it’s called a hit and run . Imagine leaving the grocery store to find your bumper smashed with no note or witnesses. It’s not just the damage that’s frustrating; it’s the uncertainty about what to do next. Why Are Hit & Runs Confusing? Many drivers aren't sure what to do because we aren’t often taught how insurance works for these situations. But the more you know, the more protected you’ll be. At Vargas & Vargas Insurance , we guide drivers through hit and run claims, breaking down the process in simple terms. Key Questions Answered: What is a hit & run under Massachusetts law? What auto insurance helps in this situation? Will your premium go up? What immediate steps should you take? What Is a "Hit & Run"? A "hit and run" involves another driver damaging your car or injuring you and leaving without giving their info. It could happen in a parking lot, on the street, or even at home. Massachusetts law requires you to report it and file a claim. Coverage That Helps in a Hit & Run Your auto policy can help—if you have the right coverage. Uninsured Motorist Coverage (UM/UIM): Essential for covering injuries to you or passengers. Collision Coverage: Covers car damage but requires you to pay the deductible. Note: Massachusetts is a no-fault state , needing collision and/or UM coverage for protection. Will Your Insurance Rates Rise? It depends. If considered a not-at-fault accident, rates might not increase. However, lack of a police report or a history of claims might affect rates. Reporting it properly is crucial. What Actions Should You Take? Call the police immediately to file a report. Take photos of all damage and surroundings. Seek witnesses or security camera footage. Contact your insurance agent for advice on filing a claim. Keep all records , like police reports and photos. The Bottom Line You can't control reckless drivers, but you can control your preparedness. Here's what you need to know: Have collision and uninsured motorist coverage for protection. A police report is essential. Your agent is your best ally for making claim decisions.  If you’ve returned to your car to find damage without a note, you know the stress. Now you know the steps to take and the protections you need. At Vargas & Vargas Insurance , we’re here to make this simple and stress-free. Unsure if your policy protects you from a hit & run? Call us at 617-298-0655 . Let’s ensure you’re covered before it happens.

Personal Liability Insurance: What Happens When Someone Gets Hurt on Your Property

By carlos vargas • November 21, 2025
In this post, we'll guide you through what happens when someone is injured on your property, how personal liability insurance can provide protection, and the steps you should take immediately if an accident occurs. By the end, you'll understand common scenarios that trigger personal liability coverage, what's included (and not included) in a standard policy, how claims are managed, and practical tips to protect yourself both before and after an accident. Understanding Personal Liability Insurance Personal liability insurance is designed to protect you financially if you are found legally responsible for someone’s injury or damage to their property. Typically, this coverage is part of your homeowners or renters insurance policy. If an incident occurs on your property and you’re held responsible, your personal liability insurance can help cover: Medical expenses for the injured person. Legal defense costs if you’re sued. Settlement or judgment amounts awarded to the injured party. Without this coverage, you could face out-of-pocket expenses which could amount to thousands or even hundreds of thousands of dollars, depending on the situation. Common Injury Scenarios on Your Property Personal liability coverage may be applicable in situations like: A guest slipping on an icy walkway. A child falling off a swing in your backyard. A delivery driver tripping over a loose step. A neighbor’s fence being damaged by a tree falling from your yard.  Accidents can happen even if precautions are taken, and unfortunately, being "careful" doesn't automatically shield you from legal or medical bills. What’s Not Covered It's crucial to understand that personal liability insurance doesn't cover everything. Most policies exclude: Injuries to you or household members. Intentional acts causing harm. Certain high-risk situations, such as injuries from business activities conducted at home (unless you have separate business liability coverage). Understanding these exclusions can prevent surprises and the frustrations often accompanying a denied claim. What Happens After an Injury on Your Property If someone is injured on your property: Get medical help immediately — the priority should be the person’s safety and well-being. Document the incident — take photos, collect witness statements, and record all details. Notify your insurance company — report the incident promptly, even if unsure whether the injured party will make a claim. Avoid admitting fault — stick to the facts when speaking with the injured person and your insurer. Once a claim is filed, your insurance company will: Investigate the incident. Determine whether your policy covers the claim. Handle negotiations, settlements, or defense in court if necessary. How to Protect Yourself Before an Accident Happens While insurance covers the unexpected, prevention is better than reaction. Reduce your risk by: Keeping walkways clear of ice, snow, and clutter. Repairing loose steps, handrails, and flooring. Properly maintaining landscaping and trees. Providing adequate lighting for entrances and pathways. Regular maintenance not only keeps your property safe but shows responsible behavior if a claim is filed. The Role of Your Insurance Broker An experienced insurance broker can help you: Review your policy to ensure adequate liability coverage limits. Clarify exclusions so you understand what's not covered. Guide you through the claims process if an injury occurs. Suggest umbrella insurance for additional liability protection beyond your standard policy limits. Having a broker means you aren't navigating these situations alone — you'll have someone familiar with your policy advocating for you. The Bottom Line Accidents can occur anywhere to anyone at any time. If someone gets hurt on your property, personal liability insurance can safeguard your finances, cover legal costs, and help manage the situation professionally. The key is understanding how your coverage works before you need it. This involves knowing your policy limits, understanding exclusions, and ensuring you have sufficient protection in place. Additional Resources: Insurance Information Institute – Understanding Liability Coverage NAIC – Consumer’s Guide to Home Insurance