Jargon Buster

We’re committed to helping our customers understand insurance. Here’s a list of common words and phrases you will come across in your policy and when making your decisions.

All | A B C D E F I L N P R S U V

There are currently 4 entries in this directory beginning with the letter L.

Lapse

The process when a policy is terminated after the policyholder fails to pay for renewal within the correct time-frame. Or the process when the insured decides to change insurers, causing the previous policy to end (become lapsed).

Liability

Process of being legally responsible for something.

Long Term Undertaking

Previously known as a Long Term Agreement (LTA), the Long Term Undertaking (LTU) is usually offered for a period of 3 years. In agreeing to accept the LTU, a local council agrees to renew its policy for a 3 year period with the same insurer, in exchange for a reduction in premium*. The insurer usually agrees to maintain their rate of premium during that period, so long as there is no adverse claims experience and subject to market conditions that may affect all insurance policies, such as a change in the rate of Insurance Premium Tax, for example.

*Reduction in premium is applicable to all sections other than Terrorism, Data Breach Response and Legal Expenses.

Loss Adjuster

An insurance specialist appointed by an insurer to review the circumstances of a claim made by a policyholder and advise the insurer what amount should be paid under the terms of the policy.