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Glossary

Plain, self-contained definitions for the property-loss estimating and claims terms used across this site.

Actual Cash Value (ACV): The cost to replace an item with a like item, minus depreciation for age and condition at the time of loss. Many policies pay ACV first on a replacement-cost claim and release the depreciation once the item is actually replaced.; Contents inventory and valuation methodology
Age-Life-Condition Method: A depreciation approach that estimates how much of a component's useful life remains based on its actual age, its expected total life, and its observed condition at the time of loss, rather than applying one flat percentage to every item.; Depreciation in property claims: physical, functional, economic
Agreed Value: An endorsement under which the insurer and insured agree in advance to a stated property value, suspending the coinsurance penalty for the endorsement's stated period. It typically must be resubmitted at each renewal to stay in force; terms vary by policy and state.; Coinsurance in commercial property insurance, explained
ANSI Z765: A published method for calculating a single-family home's finished square footage. It sets a calculation convention — what counts as finished, livable area — but does not prescribe how an individual room's dimensions are measured, and it excludes multifamily housing from its scope.; LiDAR and spatial capture for property measurement Measurement methodology for property loss estimating
Appraisal Clause: A policy provision letting either party demand a formal appraisal process when they disagree on the amount of loss: each side selects an appraiser, the two appraisers select an umpire, and a decision by any two of the three sets the amount.; Estimate review: a reviewer's checklist
Approval Gate: A required, explicit step in which a licensed professional reviews and approves scope before it becomes a priced, reportable estimate. Line items that have not passed the gate are excluded from totals and reports.; Estimate review: a reviewer's checklist Evidence-to-line-item traceability in property estimates
Audit Trail: A complete, time-stamped record of the actions taken on a claim file — who entered a measurement, who approved a scope item, who applied a price — kept in the order it occurred so the sequence of decisions can be reconstructed later.; Documentation and evidence standards for a defensible claim file Evidence-to-line-item traceability in property estimates
BOMA Floor Area Standard: One of six separate ANSI floor-area measurement standards (Z65.1 through Z65.6) published by the Building Owners and Managers Association, each covering a different building or space type. "The BOMA standard" is not one document, so a citation should specify which of the six applies.; LiDAR and spatial capture for property measurement Measurement methodology for property loss estimating
Broad Evidence Rule: A legal standard, applied in some states, under which actual cash value may be determined from any relevant evidence of value — including market value, replacement cost minus depreciation, and comparable sales — rather than one fixed formula. Whether it applies, and how it is weighed against other methods, varies by state and policy form.; Replacement cost vs. actual cash value in property claims
Business Income (Business Interruption): Coverage reimbursing the net income and continuing normal operating expenses, including payroll, a business would have earned during the period of restoration but for a covered property loss.; Business income and business interruption, explained
Business Personal Property (BPP): The contents, furniture, fixtures, equipment, stock, and supplies a business uses to operate, insured as a coverage part separate from the building itself, usually under its own limit.; How commercial property estimating differs from residential
Category of Water Loss: A classification of the water source's contamination level — Category 1 (clean source), Category 2 (significantly contaminated), or Category 3 (grossly contaminated) — used to determine required cleaning, removal, and drying protocols.; Category can escalate over time if contaminated water is not addressed promptly, even if the original source was clean.; Water damage estimating: categories, classes, and drying
Cause and Origin: The determination of where a fire started and what ignited it, typically made by a fire investigator applying a recognized methodology such as NFPA 921, and used to establish whether the resulting damage arose from a covered cause of loss.; Fire damage estimating: structure, smoke, and soot
Chain of Custody: A documented, unbroken record of who collected, handled, and had access to a piece of evidence — a sample, a photo, a measurement — from the time it was gathered to the time it supports a line item, used to show the evidence has not been altered.; Documentation and evidence standards for a defensible claim file
Civil Authority Coverage: A business income provision responding when a government order denies access to the insured premises because of physical damage to other, nearby property, not the insured's own. Coverage is typically limited by distance and duration; terms vary by policy and state.; Business income and business interruption, explained
Class of Water Loss: A classification (Class 1 through 4) of how much moisture was absorbed and how quickly it can evaporate, based on the materials affected and the extent of saturation, used to plan drying equipment and duration rather than contamination level.; Water damage estimating: categories, classes, and drying
Coinsurance: A commercial property clause requiring the insured to carry a limit equal to a stated percentage of the property's insurable value; carrying less makes the insured, in effect, a co-insurer of any loss.; Coinsurance in commercial property insurance, explained
Coinsurance Penalty: The reduced payment applied when the limit carried is less than the coinsurance clause requires, calculated as (limit carried ÷ limit required) × loss, minus the deductible.; Coinsurance in commercial property insurance, explained
Contents: Personal or business property that is not part of the building structure — furniture, appliances, electronics, clothing, inventory, and similar items — typically inventoried and valued separately from the building.; Contents inventory and valuation methodology
Deductible: The amount the policyholder is responsible for on a covered loss before the insurer's payment applies, subtracted from the calculated loss amount after any other adjustments, such as a coinsurance penalty, are applied.; Coinsurance in commercial property insurance, explained
Depreciation: A reduction in an item's value to reflect its age, condition, and remaining useful life at the time of loss, subtracted from replacement cost to produce actual cash value.; Depreciation in property claims: physical, functional, economic Contents inventory and valuation methodology
Detach and Reset (D&R): A scope item describing the removal and later reinstallation of an item — a light fixture, a cabinet, a piece of trim — so that work behind or beneath it can be completed, priced separately from replacing the item outright.; How to develop a scope for a property loss claim
Drying Standard: A documented target — typically the moisture content of an unaffected reference material — that a water-damaged material must reach before drying equipment is removed and the area is considered dry, commonly set using IICRC S500 guidance.; Water damage estimating: categories, classes, and drying
Estimate Revision: A dated version of an estimate reflecting a change — a corrected measurement, an added scope item, an updated price — kept alongside prior versions so what changed, and when, remains visible rather than overwritten.; Evidence-to-line-item traceability in property estimates Estimate review: a reviewer's checklist
Extra Expense: Coverage for reasonable additional costs a business incurs specifically to keep operating, or to reduce a business income loss, during the period of restoration, such as a temporary location or expedited repairs.; Business income and business interruption, explained
Flood Exclusion: A standard property policy provision excluding damage from surface water that enters from outside the property, such as a rising river or storm surge, as distinct from covered water damage originating inside the property, such as a burst pipe. Flood coverage, when carried, is typically written separately, such as through the NFIP; the exclusion's wording and application vary by state and policy form.; Water damage estimating: categories, classes, and drying
Functional Obsolescence: A loss of value caused by an outdated design, material, or feature that is less desirable or less efficient than current standards, distinct from physical wear and tear.; Depreciation in property claims: physical, functional, economic
Hail Impact: Damage caused by hailstones striking a surface, evaluated for a pattern consistent with the size and hardness of the reported hail — such as random, non-directional bruising or fractures — rather than assumed from the presence of dents or marks alone.; Wind and hail storm damage estimating methodology
Hidden Damage: Damage not visible during an initial inspection because it is concealed behind a wall, under flooring, or within another building assembly, and typically only confirmed once the concealing material is opened or removed.; Fire damage estimating: structure, smoke, and soot
Holdback: The recoverable-depreciation portion of a replacement-cost claim withheld from the initial payment and released once the policyholder replaces the item and submits proof of purchase, within the policy's stated time limit.; Contents inventory and valuation methodology Depreciation in property claims: physical, functional, economic
Independent Adjuster: An adjuster who contracts to handle claims for one or more insurance companies on a per-assignment basis, rather than being a direct employee of any one carrier or representing the policyholder.; Estimate review: a reviewer's checklist
LiDAR: A sensing method that measures distance by emitting pulses of light and timing how long they take to reflect back, producing depth data directly rather than inferring it from images. On phones it usually refers to Apple's own direct time-of-flight sensor, available on iPhone 12 Pro and later Pro models and iPad Pro since 2020, with reported accuracy ranging from under a millimeter in close, static, controlled tests to roughly one to two centimeters at typical room-scanning distances, and to about 0.2 meters at outdoor ranges of tens of meters.; LiDAR and spatial capture for property measurement Measurement methodology for property loss estimating
Line Item: A single priced entry in an estimate describing a discrete scope of work — a description, quantity, unit of measure, and unit price — that sums with other line items into a subtotal or total.; Line-item pricing methodology and provenance Evidence-to-line-item traceability in property estimates
Line of Sight: The visual boundary used to judge whether a repaired area will be seen alongside an undamaged area — for example, an open room versus a separate room behind a closed door — which affects matching decisions for finishes like flooring or paint.; How to develop a scope for a property loss claim
Matching: The question of whether a repair using new material next to existing, undamaged material will produce a visually or functionally consistent result, and if not, how much of the surrounding area must be replaced to achieve a reasonable match.; How to develop a scope for a property loss claim
Mesh: A 3D surface built from connected polygons, typically triangles, stretched across a point cloud's points to produce a continuous solid shape rather than a set of disconnected points.; LiDAR and spatial capture for property measurement
Moisture Mapping: A documented record of moisture readings taken at multiple points across an affected area, used to define the actual boundary of water intrusion and to verify when drying is complete.; Water damage estimating: categories, classes, and drying
Non-Recoverable Depreciation: The portion of depreciation that is not paid back even after the item is replaced — commonly applied to labor components or to categories a specific policy defines as non-recoverable — as distinct from recoverable depreciation, which is released on replacement.; Depreciation in property claims: physical, functional, economic Contents inventory and valuation methodology
Ordinance or Law Coverage: Coverage for the added cost of complying with current building codes or ordinances when repairing a damaged structure, beyond what a like-kind-and-quality repair would otherwise cost.; How commercial property estimating differs from residential
Overhead and Profit (O&P): A markup applied to line-item costs to compensate a general contractor for coordinating multiple trades on a repair; conventionally applied when a loss actually requires that coordination, not as an automatic percentage on every claim.; Line-item pricing methodology and provenance Estimate review: a reviewer's checklist
Parametric Room Model: A structured representation of a room as distinct, labeled elements — walls, doors, windows, and openings — each carrying its own properties and confidence score, rather than an undifferentiated point cloud or mesh someone still has to interpret. Apple's RoomPlan is one example, producing this kind of model from a phone LiDAR scan.; LiDAR and spatial capture for property measurement
Period of Restoration: The window a business income calculation covers — from the date of covered physical loss to when the property reasonably should be repaired and operations resumed, at reasonable speed.; Business income and business interruption, explained
Photogrammetry: A method of reconstructing 3D geometry from multiple ordinary photos of the same space taken from different angles, using the overlap between images to triangulate depth. It needs no special sensor, but it does need good, varied photo coverage and enough visual texture in the scene — a blank wall or a dark room can defeat it.; LiDAR and spatial capture for property measurement
Physical Depreciation: A reduction in value caused by wear, age, and deterioration from use, as distinct from functional or economic obsolescence; the component of depreciation most directly tied to a material's observed physical condition.; Depreciation in property claims: physical, functional, economic
Pitch: The angle, or slope, of a roof plane, commonly expressed as inches of vertical rise per twelve inches of horizontal run, used to calculate the roof's true surface area from its flat footprint.; Measurement methodology for property loss estimating Wind and hail storm damage estimating methodology
Point Cloud: A set of individual points in 3D space, each with its own coordinates, produced directly by a depth sensor or reconstructed from overlapping photos, with no inherent structure connecting the points into surfaces or labeled objects. It typically has to be processed further — into a mesh or a parametric model — before it can be reasoned about element by element.; LiDAR and spatial capture for property measurement
Porosity: How readily a material absorbs smoke, soot, or moisture based on its surface texture and composition, which affects whether contamination can be cleaned from the surface or has penetrated deep enough to require replacement.; Fire damage estimating: structure, smoke, and soot
Price Observation: A single recorded instance of a price actually paid or charged for a specific line item on a past, comparable project, used as one data point supporting a suggested unit price.; Line-item pricing methodology and provenance
Pricing Provenance: The recorded source, date, and confidence behind a unit price — whether it came from a published catalog, an organization's own observed data, a manual entry, or an unverified placeholder — kept visible alongside the price itself.; Line-item pricing methodology and provenance
Pricing Source: The specific origin recorded for a line item's unit price — such as a published pricing catalog, an organization's own observed price data, or a manual entry — kept visible alongside the price so its basis can be checked.; Documentation and evidence standards for a defensible claim file Line-item pricing methodology and provenance
Proof of Loss: A written, typically sworn statement submitted by a policyholder documenting the date and cause of loss, the property affected, and the amount claimed, required under most property policies within a stated time after a request.; Evidence-to-line-item traceability in property estimates
Public Adjuster: A licensed adjuster retained and paid by the policyholder to prepare and negotiate a claim on the policyholder's behalf, as distinct from an adjuster who represents or is employed by the insurer.; Estimate review: a reviewer's checklist
Recoverable Depreciation: The portion of depreciation withheld from an actual-cash-value payment that is released once the policyholder actually replaces the item and submits proof of purchase, within the time limit stated in the policy.; Depreciation in property claims: physical, functional, economic Contents inventory and valuation methodology
Replacement Cost Value (RCV): The current cost to replace or repair damaged property with new property of similar kind and quality, without a deduction for the age or condition of the damaged item.; Replacement cost vs. actual cash value in property claims Contents inventory and valuation methodology
Revision History: The ordered list of an estimate's prior versions, each showing what changed and when, kept alongside the current version rather than overwritten so past states of the estimate remain visible.; Documentation and evidence standards for a defensible claim file
RoomPlan: Apple's software framework that turns a phone or tablet LiDAR scan into a parametric room model — walls, doors, windows, openings, and recognized furniture as distinct, labeled elements, each with its own confidence score — rather than a raw point cloud, exportable as a USDZ file.; Apple's own reported detection figures are roughly 95% precision and recall for walls and windows, about 90% for doors, and 90–91% for furniture, measured at a 30% 3D intersection-over-union threshold; these are Apple's own published figures, not an independent audit.; LiDAR and spatial capture for property measurement
Salvage: Damaged property that retains value and can be cleaned, repaired, or sold rather than discarded as a total loss; a non-salvageable determination is the documented conclusion that an item does not qualify.; Contents inventory and valuation methodology
Scope: The complete, itemized set of work required to repair or replace damaged property, expressed as line items with quantities, that together define what an estimate covers.; How to develop a scope for a property loss claim How commercial property estimating differs from residential
Scope of Loss: The itemized description of all work required to repair or replace the property affected by a specific loss, expressed as line items with quantities, developed before pricing is applied.; How to develop a scope for a property loss claim
Smoke Residue: The film of particulate matter left on surfaces after a fire, whose composition and behavior vary by what burned, and which can travel through HVAC ductwork and building cavities well beyond the area with direct fire damage.; Fire damage estimating: structure, smoke, and soot
Soot: The fine, carbon-based particulate produced by incomplete combustion, a primary component of smoke residue whose color and oiliness vary depending on what material burned and at what temperature.; Fire damage estimating: structure, smoke, and soot
Square (roofing): A roofing unit of measure equal to 100 square feet of roof surface, used to quantify materials such as shingles or underlayment independent of the roof's actual dimensions in feet.; Wind and hail storm damage estimating methodology Measurement methodology for property loss estimating
Staff Adjuster: An adjuster directly employed by an insurance company to handle claims on that company's behalf, as distinct from an independent adjuster (contracted per assignment) or a public adjuster (representing the policyholder).; Estimate review: a reviewer's checklist
Sublimit: A cap on payment for a specific category of property or loss — such as jewelry, business property in a home, or debris removal — set below the overall policy limit and applying regardless of the category's documented value.; Contents inventory and valuation methodology
Tenant Improvements and Betterments (TIB): Fixtures and finishes a tenant installed or paid for in a leased space, whose coverage — under the building policy, the tenant's own policy, or split by lease — depends on the lease and coverage forms in force.; How commercial property estimating differs from residential
Terrestrial Laser Scanner (TLS): A tripod-mounted scanner that sends out laser pulses to build a dense point cloud of a space, at meaningfully tighter tolerances and longer range than phone-based LiDAR, but at greater cost and setup time. Studies comparing the two directly have found phone LiDAR trailing a terrestrial scanner's accuracy even under favorable indoor conditions.; LiDAR and spatial capture for property measurement
Test Square: A small, representative area used to verify a repair method, material match, or cleaning result before committing to the same approach across a full room or surface.; How to develop a scope for a property loss claim
Time-of-Flight (ToF): The general sensing technique behind LiDAR: a sensor emits a signal, usually light, and calculates distance from how long it takes to reflect back. "LiDAR" is Apple's branding for its own time-of-flight implementation on phone-class hardware, though the terms are often used interchangeably; on other platforms, depth is more often estimated in software from ordinary camera motion, with a hardware time-of-flight sensor only on a short list of devices.; LiDAR and spatial capture for property measurement
Unit of Measure: The counting basis a line item's quantity and price are expressed in — square feet, linear feet, each, square (roofing) — which must match between the quantity and the price to avoid a mismatched total.; Estimate review: a reviewer's checklist Line-item pricing methodology and provenance
Unpriced Line: A line item with no price yet entered, flagged explicitly as unpriced and excluded from a complete total, rather than defaulted to $0, which would misrepresent a missing price as a free item.; Line-item pricing methodology and provenance
Wall Area: The measured surface area of a wall, calculated as its length times its height and typically adjusted to exclude openings such as doors and windows, used to quantify materials like drywall or paint.; Measurement methodology for property loss estimating
Waste Factor: An added percentage applied to a material quantity to account for cutting loss, pattern matching, and installation overage, so the ordered quantity covers the actual area with reasonable allowance for material that cannot be used.; Line-item pricing methodology and provenance Measurement methodology for property loss estimating
Wind Uplift: An upward force generated when wind moves across a roof surface, capable of lifting shingles, membranes, or panels away from the deck, evaluated for a pattern consistent with the reported wind event rather than assumed from missing material alone.; Wind and hail storm damage estimating methodology