Understanding New Jersey Home Insurance Quotes

If you are looking to purchase home insurance, you will likely be contact with numerous different providers in order to get the best quote for you and your home. However, you may be feeling quite overwhelmed and confused by the amount of legal jargon that is forwarded to you by these companies. How are you going to make a good and informed decision if you don’t understand the information? In order to help you with your search, here are some common terms included in most New Jersey Home Insurance Quotes | NewJersey-Insurance.net.


A binder is an agreement between the insurance company and the customer that is help on a temporary or preliminary basis providing coverage until the full policy can be delivered.


This is the amount of money that the holder of the policy is required to pay before they can claim any benefits from their policy. It is possible to choose a higher deductible amount in order to lower the annual cost of the premium.

Incontestable Clause

This is a policy provision in which the insurance company agrees to not contest the contract’s validity prior to it being enforced for a certain length of time. This time period is usually around two years.

Pro-rata Cancellation

If the policy is cancelled by the insurance company mid-term then then the policy holder will only pay the premium for the time period that they were provided coverage, any excess payment is refunded to the policy holder.

Short-rate Cancellation

If the policy holder chooses to terminate the contract before the expiration date then then generally speaking the return premium they would receive would be 90% of the pro-rata return premium.

Return Premium

This is the sum of money that the insurance company is obligated to repay to the policy holder in the event of a pro-rata cancellation or a short-rate cancellation.


This is the process that will determine the quote you receive. An insurance underwriter will evaluate applicants who have applied for coverage, by classifying them according to their degrees of insurability, taking into account all of their personal details. This process will determine the amount of premium that is likely to be charged.

Policy Limit

The policy limit is the maximum sum of money that the provider will pay to the policy holder either overall or in respect of a particular coverage option.