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Labor and Materials Bond

See Payment bond.

Lapse

A policy becoming invalid because of failure to pay the premium on time.

Leasehold Interest Coverage Form

A form which belongs to the Commercial Property Coverage part of the Commercial Package policy; It covers a tenant for certain losses following damage to the premises from a covered peril, such as tenant's loss of a favorable lease or loss of remaining value of improvements or betterments made by a tenant.

Legal Liability

Rules of law dictate that a person must pay for damages done to another.

Legal Liability Coverage Form

This form belongs to the Commercial Property Coverage part of the Commercial Package policy. It covers the insured for negligently damaging property owned by others, but in the insured's care, custody or control.

Lessee

The person to whom a lease is granted, commonly called the tenant.

Lessor

The person granting a lease, commonly called the landlord.

Liability Insurance

Insures the individual for financial losses which arise out of the person's responsibilities to others imposed by law or contract.

Liability Limits

The amount (limits) of protection the insured receives in a liability insurance policy.

Liberalization Clause

A policy condition found in many standard policies which states that if the insurer adopts a revision that would broaden coverage without additional premium within some period of time prior to the policy period or during the policy period, the insured receives the benefit of such broadened coverage.

License And Permit Bonds

A category of Surety bond which covers a wide variety of occupations and operations, and which are often required as a condition of doing business.

Limits Of Liability

The maximum amount of insurance the insurance company will pay for a particular loss, or for a loss during a period of time.

Line

1) A particular line of insurance.
2) Various types of insurance written for a property owner.
3) The amount of insurance paid under a liability policy.

Liquor Liability Coverage

This form belongs to the Commercial General Liability coverage part of the Commercial Package policy. It covers liquor liability which is excluded from the standard CGL forms for those who are in the business of manufacturing, distributing, selling, serving or furnishing alcoholic beverages.

Litigation Bond

See Court bond.

Lloyds

An unincorporated form of insurance carrier comprised of individual underwriters responsible for the liabilities they assume.

Long-Term Disability (LTD) Income Insurance

Insurance replaces earnings lost due to illness or disability occurring on or off the job. Individual policies typically do not pay until the period of the disability exceeds a specified elimination period, usually 30 days or longer.

Loss

Generally:
1) The reduction in value of the insured's property.
2) The amount sought in his claim.
3) The amount paid under a liability policy.

Loss Of Use Coverage

Under the Homeowners contract, covers the insured's increased cost of living after loss and rental value of any portion of the dwelling which is rented out.

Loss Ratio

The percentage of losses in relation to premiums. For example, a 60% loss ratio would mean that there were 60 cents in losses for each $1.00 of premium.

Losses Incurred

The total losses, paid or reserved, sustained by the insurer during a particular period.

Lost Instrument Bonds

A category of Surety bonds issued in situations where a principal loses valuable securities or other papers and requests issuance of duplicates. Should the lost instruments turn up and be redeemed by the holder, the issuer of the instrument would be reimbursed.

Lost Policy Release

A statement signed by the insured releasing the insurance company from all liability under a lost or mislaid contract of insurance.