Portfolio insurance terms used by insurers

Taking out portfolio insurance to cover liabilities in all of your properties is a smart idea, as it can save you money and make it easier to manage and oversee your investments.

However, if you’re new to the world of portfolio insurance it can be confusing to work out what some of the terms used by insurers mean. Although a good insurer will use plain language as much as possible, in order to be accurate sometimes only a technical term will do.  

Here’s we demystify some of the more common terms with our portfolio insurance glossary…

Agreed value

This is the value of everything covered by your insurance. It is agreed when you take out insurance. If the value alters significantly, for example you extend a property or fit a new dormer window, you should notify your insurer.

Buildings insurance

Most people know buildings insurance covers the basic fabric of a building, but it is important to understand the finer detail about what is covered and what is not. The roof, walls, ceilings, floors, doors and windows are usually covered, but some policies exclude garages, fences and sheds. 

Contents insurance

Contents insurance covers everything inside a building, such as furniture, electrical goods, clothes and books. Your tenants will need to insure their own property, but anything you provide should come under your own contents policy. Check what is covered by your policy. For example, carpets are usually treated as ‘contents’ but harder flooring such as laminate or linoleum is sometimes covered under buildings insurance. 


This means spreading your risk by investing in a range of assets. In the context of a portfolio, you might wish to purchase a variety of properties, beyond a single area. That way, if a new motorway opens down the road or a major local employer goes into liquidation, your portfolio suffers less of a reduction in value. 


This is the amount you pay of any claim, before your insurer steps in. Generally, the higher your excess, the lower your premium will be. 

Financial Ombudsman Service (FOS)

This is the body established to resolve disputes between consumers and financial firms. If you complain about your financial advisor’s service, you might need to seek assistance from the FOS.

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General conditions

These are conditions that apply to your insurance cover. It might not be the most exciting task, but it is important to read them thoroughly so you understand your policy and any exclusions.

Index linking

Index linking keeps your insurance valuation up to date by adjusting it each year to reflect economic changes. This gives you the reassurance that your valuation is as accurate as possible. 

Material fact

This is a piece of information that would influence your insurer in assessing and setting your insurance premium. You should disclose all material facts to your insurer – failure to do so could void the policy. 

Non-standard construction

This type of property often needs specialist insurance to cover the different risk profile. This category includes thatched cottages, steel-framed houses and properties with flat roofs. 

Occupier’s liability

The occupier of a property has a legal duty to protect the safety of other people living in or visiting the property. As a landlord, you have this duty, for example ensuring that floorboards are sounds and will not collapse. Your tenants also have a duty, for example warning visitors of an uneven or slippery floor. 

Proposal form

This is the form you fill out when requesting insurance and it forms the foundation of the binding contract between you and your insurer. It is important to answer all questions to the best of your knowledge, as withholding information could result in your policy being void. 

Rebuild value

Buildings insurance does not provide cover for the market of your property. It pays out the amount it would cost to rebuild the property if it was destroyed, which is usually substantially less than the market value. 


This refers to movement in the ground beneath your property, whether caused by the rock structures beneath or man-made causes. It can cause substantial damage to property, so subsidence risk makes it harder to obtain insurance. 

Total loss

This means the cost of repair would exceed the value of the object to be repaired. For example, if a property is damaged by fire, it may be classed a total loss if the cost of rebuilding and refurbishing is greater than the market value. 

Vacant possession

This means a property is unoccupied. When purchasing a property, it is important to ensure it comes with vacant possession, or you may end up with unwanted tenants.

Are you ready to take out portfolio insurance? Stride’s specialist teams can help you find the right level of cover for you.

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Need help finding the exact insurance for you? Get insured
Need help finding the exact insurance for you? Get insured