Additional Insured: An entity that is provided first party coverage under a policy of insurance issued to the primary insured. Usually, a project owner will require the general contractor to list the owner as an additional insured. Also, general contractors will often require their subcontractors to list them as additional insured.
Adjuster: One who settles insurance claims. Typically involves investigation of the loss and a determination of the extent of coverage. In liability insurance, the adjuster coordinates the insured’s defense and participates in settlement negotiations. Adjusters may be employees of the insurer or of independent adjusting bureaus that represent insurers on a contract basis.
Allocated Loss Adjustment Expenses: Loss adjustment expenses that are assignable or allocable to specific claims. Examples include fees paid to outside attorneys and experts used to defend claims.
Alternative Dispute Resolution (ADR): Any process of resolving a dispute other than litigation, i.e., arbitration and mediation.
Anticipatory Breach: When one party to a contract communicates to the other party that it intends to breach an obligation of the contract when the time for performance of the obligation has not yet occurred or occurs when a party finds itself in a position in which it is impossible for it to perform.
Arbitration: A private process for resolving disputes in which the parties can set the rules and choose a neutral third party (called an arbitrator) to hear their dispute and render an award or decision regarding the dispute.
Casing: The trim around a window or door.
Caulking: Flexible material used to seal gaps between surfaces for the purpose of preventing leaks.
Change Order: An agreement to change the work to be performed under a contract with respect to either cost or time.
Commercial General Liability (CGL) Policy: An insurance policy that covers claims by others for bodily injury and property damage.
Construction Defect: Generally, a deficiency in the design or construction of a building or structure resulting from a failure to design or construct in a reasonably workmanlike manner, and/or in accordance with a reasonable expectation.
Corbel: Piece of stone jutting out of a wall to carry any superincumbent weight.
Counter Flashing: A metal flashing usually used on chimneys at the roofline to cover shingle flashing and used to prevent moisture entry.
Coverage Period: Length of time during which insurance coverage is placed under an insurance policy.
Crawl Space: Space between the ground and the bottom of the floor on the first level of a home.
Cumis Counsel: An attorney employed by a defendant in a lawsuit when there is an insurance policy supposedly covering the claim, but there is a conflict of interest between the insurance company and the insured defendant.
Demolition: Tearing down of buildings and other structures. Buildings, such as houses, that are only two or three stories high, are pulled down either manually or mechanically using large hydraulic equipment: elevated work platforms, cranes, excavators, or bulldozers.
Drainage: Natural or artificial removal of surface and sub-surface water from a given areas. In construction, the civil engineer or site engineer is responsible for drainage in construction projections. They set out from the plans all the roads, drainage, culverts and sewers involved in construction operations.
Dry Rot: A term loosely applied to many types of decay but especially to that which, when in an advanced stage, permits the wood to be easily crushed to a dry powder.
Drywall: Wall board or gypsum. A manufactured panel made out of gypsum plaster and encased in a thin cardboard.
Ducts: Usually round or rectangular metal pipes installed for distributing warm or cold air to rooms in the house.
Duty to Defend: The obligation to pay for legal fees and other costs of defending a claim under an insurance policy.
Duty of Good Faith: Insured’s obligation to disclose to the insurer any and all facts that could influence the insurer’s decision about providing coverage.
Endorsement: An addendum to an insurance policy that changes the original policy provisions. May serve a number of functions, including broadening the scope of coverage, restricting or limiting the scope of coverage, clarifying the application of coverage to some unique exposure, adding other parties as insureds, or adding locations to the policy.
Excess Insurance: Insurance that is purchased to cover damages over and above the damages covered by primary or underlying insurance. The limits of the underlying insurance must be exhausted before the excess insurance carrier has any obligation.
Exclusion: A provision of an insurance policy referring to hazards, circumstances or property not covered by the policy.
Expansive Soil: Refers to soil that expands and contracts depending on the amount of water in it.
Finish Carpenter: One who does finish carpentry: cabinetry, furniture making, fine woodworking, model building, instrument making, or other carpentry where exact joints and minimal margins of error are important.
Flashing: Strips of sheet metal or other material bent or formed to fit the angle between any two roof surfaces or between the roof and any projection.
Flue: Opening in a chimney through which gas and smoke passes to outside the building.
Foundation: Portion of a building’s structure that transfers the weight of the building into the ground.
Framer: Builds the skeletal structure or framework of buildings. Framers build walls out of studs, sills, and headers; build floors from joists and beams; and frame roofs using ridge poles and rafters.
HVAC: Abbreviation for heating, ventilation, and air conditioning.
Indemnity: An agreement by one party to bear the financial loss of another party for a specified event.
Latent Defect: A defect in the construction of a building that is not immediately apparent but which become apparent with the passage of time, weathering or use.
Liability Insurance: Insurance that protects an insured against claims made by third parties, such as a claim against a professional for errors and omissions.
Loss Reserve: An estimate of the value of a claim or group of claims not yet paid. A case reserve is an estimate of the amount for which a particular claim will ultimately be settled or adjudicated.
Mold: Resulting damage from moisture intrusion from a construction defect affecting either a building component or the entire unit. Typical construction defects causing water intrusion and promoting mold growth are roof leaks, window leaks, and water intrusion through defective flashings and stucco, and improperly waterproofed concrete in slabs and foundations.
Plenum: Space that can facilitate air circulation for heating and air conditioning systems, by providing pathways for either heated/conditioned or return airflows.
Plumbing: Skilled trade of working with pipes, tubing, and plumbing fixtures for potable water systems and the drainage of waste. Also refers to a system of pipes and fixtures installed in a building for the distribution of potable water and the removal of waterborne wasted.
Punch List: A written document usually prepared by the project architect listing items of work requiring correction completion by the contractor prior to being eligible for final completion of the project.
Rafter: Structural member, a type of beam, which supports the roof of a building. Typically made of wood.
Reservation of Rights: Letter from insurer to insured that provides notice that even though the insurer is proceeding to handle insured’s claim, certain losses might not be covered by the terms of the policy. By such a letter, the insurer "reserves" its right to deny coverage at a later date based on the terms of the policy.
Scope of Work: The description of goods or services to be supplied pursuant to a contract.
Scratch Coat: The first coat of stucco or plaster applied to a wall. It is grooved or "scratched" to form a good bonding surface for the next coat.
Shear Wall: Wall composed of braced panels to counter the effects of lateral loads acting on a structure. Wind and earthquake loads are the most common loads braced wall lines are designed to counteract.
Sheet Metal: Metal formed into thin and flat pieces. It is one of the fundament forms used in metalworking, and can be cut and bent into a variety of different shapes.
Shoring: General term used in construction to describe the process of supporting a structure in order to prevent collapse so that construction can proceed
Soffit: Most often refers to a material forming a ceiling from the top of an exterior house wall to the outer edge of the roof, i.e., bridging the gap between a home’s siding and the roofline, otherwise known as eaves.
Stearmans Costs: Recoverable fees that have been paid to experts to evaluate the cause of construction defects, and their costs in supervising the repairs if the case goes to trial and the homeowner prevails.
Subrogation: Allows one party who pays for a loss suffered by another party (such as an insurer and an insured) to assume the rights of that party for the purpose of recovering the loss from a third party.
Surety Bond: Contract among at least three parties: (1) the principal, the primary party who will be performing a contractual obligation; (2) the oblige, the party who is the recipient of the obligation; and (3) the surety, who ensures that the principal’s obligations will be performed. Through this agreement, the surety agrees to uphold, for the benefit of the oblige, the contractual obligations made by the principal if the principal fails to upholds its promises to the oblige.
Time and Materials: A form of construction contract wherein payment is based on the contractor’s actual cost for labor, equipment, materials, and services plus a fixed add-on amount to cover the contractor’s overhead and profit.
Underwriter: Any individual in insurance who has the responsibility of making decisions regarding the acceptability of a particular submission and of determining the amount, price, and conditions under which the submission is acceptable.
Vapor Barrier: Refers to any material, typically a plastic or foil sheet, that resists passage of moisture through walls, ceilings, and floor assemblies.
Weep Screed: Metal devices installed at the foundation plate line of exterior plaster walls if the walls are of stud framework. Intended to provide relief for the exit of rain water which might possible intrude into a building at or near the roof, at vent pipes which pierce the roof, at a chimney, at or around windows or doors, or at other possible locations about a structure.
If you have any questions regarding the Glossary above, please contact Mr. Mark VonderHaar or Mr. Steven Cvitanovic.
