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Insurance Terms
Anti-Theft
Device - A device that is capable of tracking and recovering the
automobile, usually through a homing device. This type of system will
contact a response center to begin the process of recovering the
stolen automobile.
Auto Insurance - This is insurance which protects the insured against losses
involving the use of automobiles. Various coverages may be bought
depending on the desires of the insured. Such coverages include the
liability coverages of bodily injury, property damage, and medical
payments, and the physical damage coverages of collision and
comprehensive.
Bodily
Injury Coverage - This coverage pays when an insured is legally liable
for bodily injury or death caused by an insured's vehicle or an
insured's operation of most non-owned vehicles. This coverage would
also pay for a legal defense if an insured were sued.
Business
Auto Coverage Form - The most recent commercial auto insurance coverage
form to be used. It can be underwritten as a monoline policy or as
part of a commercial package.
Business
Auto Policy - This is a policy which covers Liability and Physical
damage on commercial automobiles.
Collision Coverage - Auto Insurance that covers loss to an insured's own
automobile caused by its collision with another vehicle or object but
which does not cover bodily injury or property damage liability
resulting from the collision.
Comprehensive Coverage - Usual name for physical damage coverage resulting from
losses caused by events other than collision including fire, theft,
vandalism, falling objects and various other perils. Continuously
Insured Refers to insurance coverage being in effect from an insurer
or multiple insurers at all times, without a break or lapse in
coverage at any time for any reason.
Declaration Page - This is the report from your insurance company which includes
the types, limits, and costs for each coverage as well as the vehicles
covered by the policy. It also would include the types of coverage for
each vehicle covered by the policy and other pertinent information.
Deductible -
This is the amount an insured agrees to pay in the event of a loss.
Drive
Other Car Endorsement - This is a coverage that can be added to an auto
policy providing auto coverage for individuals named in the
endorsement while they are driving autos not owned by the individuals
and not named in the policy. Otherwise known as DOC coverage.
Employers
Non-ownership Liability Insurance - This coverage insures the employer
for liability from the use by employees of their own autos on company
business.
Extended
Non-Owner Liability - This is an endorsement to a personal auto policy
that provides broader liability coverage only for specified named
individuals. This endorsement provides cover for non-owned autos
provided for the regular use of an insured, use of autos to carry
individuals or property for a fee, and broader coverage for autos used
in the course of business.
Financial
Responsibility Clause - This clause states that an auto policy conforms
to the financial responsibility laws of any respective state in which
the insured is using the insured automobile.
Fleet Policy - This is an insurance policy that applies to a multiple number
of vehicles, usually five or more.
Garage
Coverage Form - This is a commercial auto insurance form that is used
to cover automobile dealers, repair shops, service stations, and
garages.
Garaging Location - This is the zip code where an automobile is parked when not
being used and usually corresponds to the primary residence of the
insured.
Good
Student Discount - This is a discount awarded to students with high
scholastic achievement. Hired Automobile- This coverage applies to
autos an insured leases, hires, rents, or borrows, but not to autos
owned by employees or their families.
Limits -
The most an insurance company will pay for a specific insurance
coverage. Individuals can choose the limit, which meets their needs.
Many states have laws that specify the minimum limits an insured must
purchase.
Livery Use - The use of an automobile for hire to carry individuals. Livery
use is excluded in auto policies unless coverage for it is
specifically stated.
Motor
Vehicle Record - The driving record of an individual which includes
accidents and traffic violations. It is also known as an MVR. Named
Insured- It is the first individual in whose name the auto insurance
policy is issued.
Named
Non-Owner Policy - It is an auto insurance policy issued to an
individual who does not own an automobile, but who drives loaned or
rented automobiles.
No-Fault Insurance - Several states have laws permitting the individual
automobile accident victim to collect monies directly from their own
insurance company for medical and hospital expenses regardless of
whose fault the accident was. The laws vary from state to state.
However, most states will allow the individual to sue the party at
fault if the amount of damages is higher than a certain stated limit.
Occasional Driver - An individual who is not the primary or principal driver of
the automobile.
Personal
Injury Protection or PIP - These policies refer to no-fault benefits in
states that have enacted mandatory or optional no-fault auto insurance
coverages. Generally, PIP includes benefits for medical expenses, loss
of work income, accidental death and funeral expenses.
Physical Damage - Damage to an automobile resulting from perils such as
collision, theft, fire or any damage to the automobile itself.
Policy
Expiration Date - The date when an insurance policy expires.
Radius
of Operation - This is usually used to develop rates for autos used in
a business endeavor. The larger the radius the higher the rates.
Safe
Driver Plan - This is a plan for which points are given for traffic
violations and certain types of accidents, with each point adding a
percentage surcharge to the rating factor that is used for determining
rates.
SR-22 -
This is a document required by the court for individuals convicted of
certain types of traffic violations that shows proof of financial
responsibility.
Threshold Level - This is the level at which an insured may start a tort action
under a modified No-Fault Auto Plan.
Towing Costs - This is an optional auto coverage that pays the cost up to a
fixed amount for the towing of an inoperable vehicle.
Transportation Expenses - This is coverage for transportation expenses incurred by the
named insured only when the theft of the insured's automobile occurs.
There is a daily and maximum dollar limit.
Underinsured
Motorists Coverage - This is coverage in an auto policy for which the
insurer will pay claims up to certain limits for bodily injury
damages, if the limits of liability under the liable motorist's policy
are completely used up and the liable motorist can't pay the full
amount for which he is liable.
Unsatisfied
Judgment Fund - Also known as UJF, many states have laws, which provide
for reimbursement to a person injured in a car accident who has not
been able to collect from the responsible party.
