Sunday, August 14, 2022
HomeViral NewsCar Insurance Terms and Glossary

Car Insurance Terms and Glossary

Car Insurance Terms and Glossary

No car insurance resource would be complete without a comprehensive glossary of car insurance terms. We’ve compiled a list of terms and their definitions to better help you navigate the sometimes confusing world of insurance.

Accident – ​​It is an unforeseen accidental event that causes damage to property to a vehicle or bodily injury to a person. The incident may be a fault or non-fault and may or may not be reported. The collision of two vehicles can be called a collision.

Accident Report Form – This is a report filed by the police, often called a police report, that contains important information about a vehicle collision. This report will include the names of all persons involved, vehicles involved, property damaged and citations issued.

Adjuster – This is the person who will assess the actual loss reported on the policy after an accident or other event. They will determine how much will be paid by the insurer on the auto insurance policy.

Agent – This is a licensed and trained person authorized to sell and service insurance policies for an auto insurance company.

On fault – This is the amount contributed by you, the policy holder or caused the auto collision. It determines which insurance agency pays what portion of the loss.

Auto Insurance Score – This is a score similar to a credit score that evaluates the information in your consumer credit report. These scores are used when determining the pricing for your auto insurance policy. Negative marks on your credit report can increase your auto insurance premiums. The use of this information for policy pricing varies from state to state.

Automobile Insurance – It is a type of insurance policy that covers and protects the damages associated with automobiles. Auto insurance policies cover a wide range of coverage based on the needs of the policy holders. Liability for property damage and bodily injury, uninsured motorist, medical payments, comprehensive, and collision are some of the common coverages offered under auto insurance policies.

Binder – This is a temporary short-term policy agreement that is placed or distributed in place of a formal permanent policy.

Bodily Injury Liability – This is the portion of the insurance policy that covers the cost of someone you injure. This can include lost wages and medical expenses.

Broker – This is a licensed person who sells and serves various insurance policies on your behalf.

Claim – This is a formal notice made to your insurance company that a loss has occurred that may be covered under the terms of an auto insurance policy.

Claims Adjuster – This person employed by the insurance agency will investigate and settle all claims and damages. A representative for the insurance agency to verify and ensure that all parties involved in the loss receive compensation in a fair and fair manner.

Collision – The part of an insurance policy that covers damages caused by your vehicle colliding with another object. Items may include but are not limited to; Another vehicle, a building, curbs, guard rails, trees, telephone poles or fences. A deductible will apply. Your insurance company will cover these costs on the back of the other parties’ insurance policies if they are at fault.

Commission – This is the portion of an auto insurance policy that is paid to an insurance agent for selling and servicing the policy on behalf of the company.

Comprehensive – This is a part of an insurance policy that covers damage caused by a collision with another object or anything other than a collision with another object. A deductible will apply. This includes but is not limited to vandalism, storm damage, fire, theft, etc.

Covered Loss – This is damage caused to you, other people or property or your vehicle which is covered under auto insurance policy.

Declaration Page – This is the part of the insurance policy that contains the full legal name of your insurance company, your full legal name, vehicle identification number or VIN, policy information, policy number, car details including deductible amount. This page is usually the first page of the insurance policy.

Deductible amount – This is the portion of the auto insurance policy that the policy holder must pay before the insurance company contributes and is required to pay any benefits. This amount can range within a wide range in value and can vary between around $100 – $1000. The larger the amount you pay in the deductible, the lower will be the cost of your normal monthly/annual policy. This is the part of the auto insurance policy that will only apply to comprehensive or collision coverage.

Discount – This is the reduction in the total cost of your insurance policy. Deductions may be granted for a variety of reasons, including a good driving record, grade, age, marital status, specific features on the automobile, and safety equipment.

Personal Property Liability – This is the part of the auto insurance policy that covers any damage or loss caused to the personal property of another person.

Personal Injury Protection or PIP – This part of an auto insurance policy pays you and any passengers in your vehicle for any lost wages or medical expenses after an accident. PIP is also known as medical payment coverage.

Premium – This is the amount charged to you monthly, yearly or for any other term as agreed by the insurance company and the policy holder and paid directly to the auto insurance company. A premium is based on the type and amount of coverage you have on your vehicle and the coverage you choose for yourself. Other factors that can affect your insurance premium prices include your age, marital status, the type of car you drive and credit report, the type of car you drive and whether you live in an urban or rural area. Premiums vary according to the insurance company and where you live.

Quotation – This is the amount or estimated amount that the insurance will cost based on the information provided to the agent, broker or auto insurance company.

Cancellation.- This is the cancellation of an insurance policy prior to its effective date. This resulted in refund of the full premium which was charged.

Rental Reimbursement – ​​This is the part of the auto insurance policy that covers the cost of renting a similarly sized automobile if the covered vehicle is in repair from a reported incident.

Replacement Cost – This is the amount of money spent to replace a lost or damaged item, it is the new replacement value in fact. This monetary amount will be based on a new similar item in the existing local market.

Salvage – This is the property of the auto insurance policy holders which is turned over to the total insurance agency in the eventual settlement of the loss. Insurance companies will sell the salvage property in hopes of recovering some of their monetary loss due to loss and settlement.

Second Party – This is the actual insurance company in the auto insurance policy.

Surcharge – This is the amount that is added to the premium of your vehicle insurance policy after a traffic violation or accident in which you are found guilty.

Third Party – This is any person other than the policy holder and the auto insurance company who has suffered a loss and may be able to collect and indemnify on behalf of the policy holder’s negligence.

Total Loss – This is the complete destruction of the insured property of the policy holder. It has been determined that it would be a larger amount to repair the item rather than replace the insured piece of property in its state prior to damage.

Towing Coverage – This is the part of the auto insurance policy that covers a specified amount for towing services and related labor costs.

Under Insured Driver – This is part of an auto insurance policy that covers injuries caused to you by a driver without sufficient insurance to pay medical expenses caused by the accident. This is part of the policy that can vary from state to state as damage to the car is covered in this section in some states.

Uninsured Driver or Motorist – This is the part of the auto insurance policy that covers injuries caused to you by the driver at the time of the accident without liability insurance. Uninsured driver or motorist coverage falls into two different sections; Uninsured motorist bodily injury and uninsured motorist property damage. Insured motorist bodily injury coverage covers injuries to you or any passenger in your vehicle in case of an accident with an insured motorist. Insured motorist property damage coverage covers the cost of property damage to your vehicle when an accident occurs with an uninsured uninsured driver. Uninsured driver or motorist coverage must be offered when you purchase the required liability coverage for your vehicle. If you decline uninsured driver or motorist coverage, you must sign a disclaimer waiver. Most states require drivers to carry some form of uninsured motorist coverage. Some states cover damage to your car in this coverage.

Vehicle Identification Number or VIN – A VIN is a 17 letter and number combination that identifies a unique vehicle. It will identify the make, modem and year of the automobile. This number is usually located on the driver’s side window on the dash. It can also be found on vehicle registration and title.

RELATED ARTICLES

3 COMMENTS

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisment -spot_imgspot_imgspot_imgspot_img

Most Popular

Recent Comments

Viral Vacation Ideas on Car Insurance Terms and Glossary