Jargon buster: What do all of these insurance words actually mean?

01 Apr 2021
By Unite Students, Staff writer at The Common Room

Insurance can be confusing no matter how old you are. But when you’re a student who’s just starting to get a taste of independence, insurance terms can be even harder to get your head around.

The thing is, insurance is so important when you head to uni (after all, what happens if you lose your laptop or smash your phone?), so it’s a good idea to understand as much of the lingo as you can.

To help you out, we’ve been chatting to our specialist student insurance partner, Endsleigh, and their expert crew has kindly broken down five commonly-used insurance-related words, so you can understand them a little better.

1. Broker

An insurance broker (for example, Endsleigh) is the ‘middle person’ between a customer (that’s you) and an insurer. A broker is usually the company you’ll get your insurance quote from and will be often referred to as an ‘intermediary’.

If you choose to get your insurance through the broker, they will then give you all of the information you need to manage your cover (whether that be through an account on the broker’s website, or directly with the insurer). A broker’s main job is to match their customers with the very best insurance for their needs.

2. Cancellation

This is where insurance is cancelled before it’s due to expire. Most insurance policies typically last 12 months, so if you were to stop your insurance after 10 months, this would be a cancellation.

If you do cancel your insurance before the 12 months is up, you may need to pay a cancellation fee.

3. Claim

A claim is where you ask your insurer to pay for or replace an item which has been damaged or lost for a reason covered by your insurance.

For example, if your phone was stolen and you had gadget insurance that covered you for theft, you could make a claim and get your phone replaced. If the exact model was unavailable, you may prefer a cash payment instead so you can source your own phone.

4. Excess

An excess is the amount of money you have to pay if you need to make a claim. Your excess is in place to show that you accept a (very small) part of the risk you’re being covered for.

There is normally a ‘compulsory’ excess as standard, then you can sometimes add what’s called a ‘voluntary’ excess to try and bring the cost of your insurance down. This means you agree to pay more if you need to claim (because you’ll need to pay the compulsory and voluntary excess).

How much you need to pay will differ based on your insurer and what you’re insuring. But excess amounts on student insurance are usually lower.

Excess amounts tend to be higher if your gadgets are insured on, for example, your parents’ home insurance. This is why many students prefer to take out their own student gadget insurance.

*Correct as of February 2021.

5. Lapse

If your insurance is lapsed, this means that you are no longer paying for cover and (if you haven’t arranged other insurance elsewhere), you’re no longer protected. A lapsed policy is when your insurance cancels from your renewal date, rather than in the middle of your policy.

This is less of a problem for protecting things like gadgets (however, you won’t be able to claim if something happened during this time). But if your car insurance were to lapse without you renewing/finding other insurance, you’d be breaking the law. You also wouldn’t be covered if you had an accident and could even be faced with a fine, penalty points or a driving ban.

Your insurer will let you know when your insurance is due to lapse. You can then review the renewal price they’ve offered and decide whether you’ll be staying with them for another year, or looking for a cheaper quote somewhere else.

Do I already have insurance?

If you’re staying with Unite Students, you already have contents insurance in place with Endsleigh. This protects your belongings in your student accommodation and you can view your cover here.

If you’d also like to be protected outside of your student home (if you’re out and about at uni, or studying at the library), you can pick up one of Endsleigh’s Everywhere Student Packs when you confirm your cover. This way, you’ll know that your favourite things will be protected wherever you go.

If you own something that we don’t cover under our Everywhere Student Packs (like a bicycle, or musical instrument), you can personalise your own cover. There’s something for everyone!

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Staff writer at The Common Room