Additional Interest: Lenders tend to have an “interest” in your vehicle. For example. If you’re borrowing money to purchase the vehicle, the vehicle is an “interest” of the company lending the money.
Bodily Injury Liability: Liability for bodily injury.
Car Insurance Coverage: The 5 major types of auto insurance coverage is medical (payments), uninsured (under-insured), liability (your direct libability), collision (the accident) and comprehensive (also known as ‘comp’, which covers theft, vanadalism, etc).
Claim: If you or your passengers have been injured, or/and your vehicle is damaged, a claim is what you file to be reimbursed.
Collision Coverage: This is the coverage that provides protection for your car in the event of damage by an inanimate object, such as another car, a tree, or the side of a building.
Collision Deductible Waiver: This coverage is not available in every US state, but it implies that your insurance company will pay the deductible if an uninsured motorist causes the accident (meaning, you’re not at fault).
Comprehensive Coverage: Theft, fire, vandalism…basically, any damage caused not involving you or someone you let drive the vehicle – drive the vehicle.
Continuous Coverage: How long have you continuously had auto insurance? Exactly, that’s the answer. If you’re not currently insured it’s a “lapse in coverage”. Continuous coverage is the measure of how long you’ve continued to maintain auto insurance coverage and most insurers like to see at least 6 months. Keep in mind, a lapse of coverage in some states requires SR22 Filing and that’s not fun.
Deductible: Your auto insurance deductible is the amount you must pay before your insurance company pays out on a claim. Let’s say your deductible is $500. You hit a curb and the damage to your vehicle is $823. You would owe $500, beyond that amount your insurance company would pay $323 towards damages. Apply that to any scenario. Your deductible is what you must pay before an insurance company will contribute.
Declarations Page: The “fine print” that discloses what your insurance company will pay out on, your liability, etc.
Defensive Driver Course: Your local DMV (or state approved programs) will offer driving classes. Insurance companies will often give you a discount for taking and passing these classes. Defensive driving certification can really pay off with lower rates.
Depreciation: Come on, you know this one! You buy a vehicle new, 5 years later you try to sell it – it’s worth 25% of the purchase price. That’s depreciation. Insurance companies work on these metrics. As a caveat, keep that in mind when insuring an older vehicle, sometimes it’s cheaper to keep liability (no comp or collision) on it since the payout wouldn’t be worth the extra premium in the long run. Not advice, I’m just saying – the depreciation of your vehicle can certainly be a shock when it’s time to collect on a claim.
Drive-Other-Car Endorsement: Do you drive cars other than the ones you own? Well, this is a rider (insurance talk for an added clause) that covers those vehicles.
Effective Date: This is the date your auto insurance coverage starts and becomes effective.
Emergency Road Service: Optional (added cost) coverage provided by many insurance companies.
Endorsements: Any changes to your coverage are endorsements.
Exclusions: Check your policy. Any exclusions means “DO NOT”. So, if you’re sister is a “named exclusion” that means she’s not covered to drive your vehicle. Exclusions are not to be taken lightly, read and understand them.
Expiration Date: The date your insurance company will cancel your policy. Just a hint. Look at the date, and roll back one day. The actual date is usually at 12:01 am, meaning, if your policy says “11/07 your policy will expire, that really means you better pay by 11/06 – because by 12:01 am your policy is canceled.
Extended Non-Owner Liability: Endorsement that extends coverage (liability coverage) for people you name operating any “non-owned” automobile.
Financial Ratings: For more info on this, head to – Insurance Company Ratings
Full Coverage Car Insurance: Full coverage essentially means “the required amount of coverage to satisfy a lenders requirements”. If you have a loan on a new vehicle, you’re required to maintain full coverage, which is the full amount of coverage necessary to recoup the costs of a totaled vehicle by your lender. Your state plays a large part in what’s acceptable.
Gap Insurance: Optional coverage that provides the difference between true value of the car and what you owe on a lease or a loan. Any difference is usually not covered by a standard insurance policy. Read more here – Do I Need Gap Insurance?
Garaging Location: This is the location where you tell your insurance company you park your car. That is the garage location.
Good Student Discount: Many insurers provide discounts for students with good grades/GPA’s. Read more here – Good Student Insurance Discounts
Hit and Run: A driver involved in an accident that flees the scene.
Income Loss: Optional coverage that pays out in the case of lost wages. Get in an accident and miss work? There you go.
Indemnity: Insurance makes you “whole”. Like, bread. Or pudding. (this was not good insurance advice, so speak to an agent).
Independent Agent: An agent who does not work for captive carriers.
Insurance Premium: This is the amount you pay to an insurer. Your “Rate” as you may call it. Your premium often is in 6 month intervals.
Insurance Score: Risk based score that determines your risk.
Insured: The people covered by an insurance policy. You are, the insured, if you’re on the policy.
Judgment: The court declaration of funds allotted to an assessment of arbitrary ordinance of actuality in perpetuation or pertenalitationousity of prospect. Dude, it’s a f@#$ing judgment. I would hope you understood that.
Liability: You owe money, it’s liability.
Liability Coverage: The coverage that shows the extent of liability.
Lien Holder: The people that hold your lien.
Limits: These are your coverage limits – look it up.
Medical Payments Coverage: Coverage that pays for medical payments.
MVR (Motor Vehicle Record): Your Motor Vehicle Record is your record, easy.
No-Fault Insurance: There are many fault states, I’ll cover below. No fault insurance.
No-Fault State: Here’s a list of no fault states.
Non-Passive Alarm: an alarm that isn’t passive.
Passive Alarm: An alarm that is passive.
Personal Auto Policy (PAP): This is a personal auto policy, for people.
Personal Injury Protection: PIP! Read it. It’s PIP. Good stuff.
Physical Damage: That damage that be of the physical nature.
Pleasure Use: Do you yacht on your boat? That’s pleasure. Or…not.
Policy Lapse: Don’t let that policy lapse, or it’ll cost you. Keep your stuff current.
Policy Period: This is the length of time your policy is valid.
Preferred Risk: Do you prefer risk? I don’t.
Premium: Auto insurance cost.
Primary Driver: Primary person driving your car.
Primary Use: Are you big on cruising to the yacht club? No. But if you were, that was primary use.
Private Passenger Auto: That is your car. Not the church vehicle, or a school bus, it’s your small car.
Property Damage Liability Coverage: This is the part of the policy where it says “we will pay out for property damage”…read it.
Pro-Rata Cancellation: I honestly, don’t know.
Property Damage Liability Insurance: Liability of property damage.
Rental Car Reimbursement: Need a rental car after an accident? There ya go. It’s optional coverage for the most part.
Secondary Driver: Someone besides the primary driving the vehicle.
Short Rate Cancellation: This is a very large word. Short rate cancellation. Fun.
Split Limits: So you wanna split limits? Good. Here’s a limit. $2903234,234020342,020340234. Split that.
SR-22: We love SR22. It makes insurance companies rich.
State Minimum: Every state in the whole united states of america has a state minimum. Learn them. Or, don’t. Up to you. Your insurance company will tell you anyway.
Term: Active policy length.
Tort: A small cake.
Underinsured Motorists Coverage: Underinsured? Uninsured? There’s coverage for that.
Uninsured Motorists Coverage: Uninsured drivers cost money, this coverage helps and is often required in many states.
VIN: Vehicle Identification Number. 17 digit number that identifies your vehicle.
