Defining coverage terms

A coverage term is a value that specifies the extent, degree, or attribute of coverage. Coverage terms usually are limits or deductibles. However, coverage terms also can be other terms of coverage, such as a coverage election or scope of coverage. Following are examples of these types of coverage terms:

coverage election	Does Boiler and Machinery coverage include coverage for air conditioning failure?
coverage scope	How many licensed beauticians are covered by this liability coverage?

A coverage term pattern holds all configuration information for the terms of a coverage. Each coverage pattern has an associated coverage term pattern. PolicyCenter uses the coverage term pattern to create coverage term instances for coverage instances.

A coverage can have zero, one, or many coverage terms:

• Loss of Use coverage in the base commercial auto line is an example of a coverage pattern with no coverage term patterns. After you add the coverage, the extent of the coverage is the same for all policies.
• Hired Auto Collision coverage in the base commercial auto line is an example of a coverage pattern with one term pattern. It has a deductible term, but no other terms, such as a limit.
• The Employee Dishonesty coverage in the base businessowners line is an example of a coverage pattern with multiple coverage term patterns. It has terms for limit, number of covered employees, and number of covered locations.

When you add a coverage term pattern, you specify, among other parameters, its term type and its model type.

Term type	Convention for selecting the value of the coverage term within PolicyCenter. For example, do you choose from a drop-down list, enter a numeric value, or select from a predefined set of packaged values, such as 100/200/300?
Model type	What the value measures. For example, is the value a limit or a deductible? This information can be used when integrating PolicyCenter with other systems to correctly interpret the coverage term pattern information.

Coverage term patterns are added and configured in Product Designer.

• You set the coverage Term Type in the Add Term dialog box as you create the coverage term.
• You set the coverage term Model Type in the Integration section of the Coverage Term home page, after you create the coverage term.