Glossary

The language of insurance can be quite complex and confusing. Below are some commonly used insurance terms and their meanings. Insurance professionals with whom you may come into contact should be prepared to explain these terms. If you don't understand, ask!

This information is for educational purposes only and should not be relied upon to form professional opinions on coverage issues.

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

H

Habitation

Dwelling place; residence.

Habitational Fire

Fire occurring in a dwelling.

Hail Insurance

Insurance of property against damage which occurs by hailstorm. Usually refers to growing crops but coverage is also provided under other policies such as for automobiles, buildings and their contents.

Hard market*

The part of the insurance cycle in which premiums rise significantly. It is usually associated with a sharp decline in capacity. (See also Soft market).

Hazard

1) A risk or probability that the event insured against might occur.

2) Condition which engenders or increases the chances of a loss.

Hazard, Moral

Hazard arising from character, interest, habits and lack of integrity of the insured or person concerned.

Hazard, Physical

Hazard arising from physical condition or characteristics of the object that is insured, e.g., using and storing volatile materials and substances on the premises.

HCMU – AB (Accident Benefits)*

A relative index based on the frequency of Accident Benefits (personal injury) claims.

HCMU – Collision*

A relative index based on the cost per vehicle for Collision insurance claims.

HCMU – Comprehensive*

A relative index based on the cost per vehicle for Comprehensive insurance claims (including theft).

HCMU – Relative claim index*

A relative index based on the cost per vehicle for a specified coverage’s insurance claims.

HCMU – Theft claim cost*

A relative index based on the cost per vehicle for theft claims.

HCMU – Theft claim frequency*

A relative index based on the frequency of theft claims (that is, the number of claims reported as a percentage of the number of vehicles with Comprehensive coverage).

High-Risk Automobile Insurance Market*

Consumers with a poor driving record (e.g., multiple driving infractions, demerit points or criminal convictions involving driving), or no driving record at all (i.e., new drivers), may, in many cases, be insured by insurance companies that specialize in drivers who are high risk.

 

Highway Traffic Act

The body or system of laws which govern the obligations of the provincial governments and users of roads. A breach or conviction of any of these laws may be an offence but does not of itself impose legal liability, but it may be relied upon in any proceeding to establish or negate any liability.

Hit and Run Accident

Collision between motor vehicle and/or a motor vehicle and another object and/or a motor vehicle and a pedestrian where a driver leaves the scene of the accident without identifying him/herself. This is an offence under the Highway Traffic Act.

Hold Harmless Agreement

A contract or agreement in which one party assumes legal responsibility for the acts of another.

Homeowners insurance*

An elective combination of coverages for the risks of owning a home. It may include coverage for fire, burglary, vandalism, earthquake and other perils.

Hostile Fire

A fire which occurs in or escapes to a place not anticipated, e.g., a fire in a fireplace becomes uncontrollable and ignites something externally. See Friendly Fire.

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