There is danger at every corner when it comes to Indian roads. Your brand new vehicle, and it gets hit by someone who mistakes a highway for space, and his car for a space shuttle. Insurance can pay for your financial loss, at least.
We give you the various insurance schemes, details about what is insured, the Comprehensive Cover, Third Party Insurance and much more.Other online services include insurance online service. Get your vehicle insured online, and drive without a worry. Also read on about the major insurance companies.
Car Insurance Rates
Car Insurance Rates is your ultimate online resource for auto insurance. We provide company reviews, vehicle purchasing advice, valuable information on all types of policies, and more!
How Safe is Your Car?I'm going to buy a "family car" for my wife and I want to make sure it has good safety features. What should I look for?
If you are in the market for a new car, one of the main features you look for in your new car should be the safety features. You will want to be sure that your new car is safe for you to drive and safe for the road. Having a safer vehicle can get you a lower car insurance quote. Over time car safety has become more and more important and in response this importance many new cars safety has improved tremendously.
Your cars safety can protect you from serious injury or maybe even death if you are involved in a car accident. The safety of your car will vary depending on the level of protection your car offers you and your passengers. There are many different safety features that can be included in your car. The level of protection and safety of your car will depend on how many of the safety features are included in the car you decide to purchase.
When talking about safety features, there are three categories that have a combination of features that will determine the level of safety of your car. Knowing the level of safety that your car provides is a good way to get a lower quote on your car insurance.
The first category of safety features is the crash avoidance feature. This feature is composed of factors that will keep you from getting into a crash. The components of this safety feature category are Electronic Stability Control or ESC, Traction Control and Anti-Lock Braking Systems or ABS.
The second category of safety features is the crash protection feature. This feature is composed of factors that will keep you protected if you do get into an accident. The components of this safety feature are Seat Belts, Car Crumple Zones and Airbags. The third category of safety features is the driver features. These features are considered to be apart of this component if they make driving easier and more comfortable for you. Seat Height Adjustment and Steering Wheel Adjustment are two components of this safety feature.
If your car has all of these features, you should feel comfortable in knowing that you have a pretty safe car an your risk of getting into an accident is lower and your chances of getting seriously injured if you are in a car accident are low as well. You can find out if your car has these safety features by asking you car salesman about them or you can even ask your mechanic to do a safety inspection on your car to let you know which components of the car safety features you have on your car.
If your car has all of these features, you should feel comfortable in knowing that you have a pretty safe car an your risk of getting into an accident is lower and your chances of getting seriously injured if you are in a car accident are low as well. You can find out if your car has these safety features by asking you car salesman about them or you can even ask your mechanic to do a safety inspection on your car to let you know which components of the car safety features you have on your car.
Always remember the safer your car the lower your car insurance since a lot of car insurance companies are willing to give discounts to people who drive safe cars. If you feel the car you are interested in is not safe enough you can ask your car salesman for an upgrade or the cost of adding the safety features to the car. If you already have car and feel it isn’t safe enough ask your mechanic what you could do to improve the safety of your car.
What to Do if You Are Caught with Expired InsuranceI was pulled over and didn't have my proof of insurance. Is there anything I can do to avoid the fine?
Car insurance is the protection you need while you are out driving. It not covers you from financial loss but it also protects the investment you have made by purchasing your car. Therefore car insurance is definitely something that you don’t want to go without. Even though the minimum requirements for car insurance may vary from state to state, the one guarantee you can bank on is that every state considers car insurance mandatory coverage if you will be driving there. You can check with your local Department of Motor Vehicles or any car insurance provider in your state for guidelines on the minimum coverage requirements for car insurance in your state.
You will want to be sure that the car insurance you have meet those requirements. If they don’t you should discontinue driving until you are able to get the required car insurance you need to be considered a legal driver in your state. Car insurance protects you in the case your car is damaged. If you are unable to pay for the costly repairs, your car insurance will pay for it and all you will have to do is pay your deductible. Car insurance is also a big help if you were to incur medical bills due to an accident. If you don’t have car insurance you will put yourself a risk for financial stress.Car insurance also protects you from having to pay costly fines if you were caught driving without it. Every state has its own specific penalties for driving without car insurance however the foundation of the stress and problems you will have to face is pretty much the same. If you are caught driving without car insurance or with expired car insurance, you will have a mountain of problems and maybe even debt on your hands. The first thing you will want to do is seek the advice of a lawyer. A lawyer can give you the specifics on the troubles you will face because of your disobeying the car insurance law in your state.
In some states the penalty for driving without car insurance or with expired car insurance is worst than the penalty for driving while drunk. You could risk losing your license for 6 months to a year; a very high fine which has been known to range from $150.00 to $300.00 or more and you may even be required to do community service. Some states will even make you pay for the cost of your court hearing that is equally expensive as the penalty. You could even be required to pay what is called no insurance surcharges that could require you to pay from $100.00 to $250.00 a year for a maximum of three years. This is how important driving with the proper car insurance is to you.
Some states may allow you to bring in proof of car insurance coverage to your court date and then they will either minimize the penalties or waive them altogether no matter if your purchased or renewed your car insurance after the date of your offense. However, some states will only drop the charges against you if you are able to show proof that you had car insurance coverage on or before the date of your offense.
Cash for Clunkers Program ExplainedWhat are the qualification requirements for the Cash for Clunkers program?
Some states may allow you to bring in proof of car insurance coverage to your court date and then they will either minimize the penalties or waive them altogether no matter if your purchased or renewed your car insurance after the date of your offense. However, some states will only drop the charges against you if you are able to show proof that you had car insurance coverage on or before the date of your offense.
Cash for Clunkers Program ExplainedWhat are the qualification requirements for the Cash for Clunkers program?
The Car Allowance Rebate System, commonly known as the “Cash For Clunkers” program, is an initiative set up by the federal government to get older, inefficient cars off the road, all while providing consumers incentives for purchasing a new and more environmentally friendly vehicle. Consumers could find that the cash incentives will save them thousands on a new car, which could result in lower costs overall for auto maintenance, gas and, possibly car insurance premiums. It’s up to each individual consumer to assess his/her personal benefits from the CARS program. This handy guide may be able to assist you in the process.
Car Allowance Rebate System (CARS) info
CARS is a government-funded program estimated to cost $1 billion that is designed to give consumers incentives to purchase or lease environmentally friendly vehicles. Consumers will be asked to bring a fuel inefficient vehicle to a participating dealer, and in turn they will receive a credit/rebate on the costs of a new and more fuel efficient vehicle.
The government hopes the program will boost sales of cars and trucks – not just vehicles produced by American manufacturers – all while increasing the number of safe and clean vehicles on the nation’s roads and highways.
If eligible, consumers will receive a credit of either $3,500 or $4,500 from the purchase of their new vehicle. An individual dealer may also offer extra incentives, so it’s wise to shop around to secure the best possible purchasing situation. For example, you may want to find a car that will cost less to insure, or one that incorporates new safety features.
The program is limited and will run from only July 1 through November 1 of 2009. If the $1 billion in funds runs out, the program will stop. It’s in your best interest to visit a dealership in person or online early to find out your eligibility. You will, however, be required to conduct the entire process at an in-person dealership. According to the U.S. Department of Transportation, only dealerships can participate in the CARS program.
Not all vehicles will be eligible for the program. To find out if your car or truck is eligible you can visit your local dealership or check with the CARS program online through the U.S. Department of Transportation.
Once your vehicle is accepted by the dealership, your car’s engine will be destroyed; the rest of the vehicle will be sold to a scrap yard for parts.
How do I know if I’m eligible?
While there are thousands of makes and models of vehicles on the road today, it
can be difficult to narrow down simply exactly which vehicles are eligible. If you think your car might qualify, contact your local dealer of choice immediately. Not all dealers are required to participate, but most are choosing to be part of the CARS program because it will boost sales. As a rule of thumb, your car may be eligible if it meets these requirements:
Vehicle is less than 25 years old.
Vehicle gets less than 18 miles per gallon.
Vehicles must have been continuously insured for the past year. You will be required to provide proof of car insurance coverage.
Large trucks or SUVs may have different mileage requirements/specifications to be eligible.
CARS is a government-funded program estimated to cost $1 billion that is designed to give consumers incentives to purchase or lease environmentally friendly vehicles. Consumers will be asked to bring a fuel inefficient vehicle to a participating dealer, and in turn they will receive a credit/rebate on the costs of a new and more fuel efficient vehicle.
The government hopes the program will boost sales of cars and trucks – not just vehicles produced by American manufacturers – all while increasing the number of safe and clean vehicles on the nation’s roads and highways.
If eligible, consumers will receive a credit of either $3,500 or $4,500 from the purchase of their new vehicle. An individual dealer may also offer extra incentives, so it’s wise to shop around to secure the best possible purchasing situation. For example, you may want to find a car that will cost less to insure, or one that incorporates new safety features.
The program is limited and will run from only July 1 through November 1 of 2009. If the $1 billion in funds runs out, the program will stop. It’s in your best interest to visit a dealership in person or online early to find out your eligibility. You will, however, be required to conduct the entire process at an in-person dealership. According to the U.S. Department of Transportation, only dealerships can participate in the CARS program.
Not all vehicles will be eligible for the program. To find out if your car or truck is eligible you can visit your local dealership or check with the CARS program online through the U.S. Department of Transportation.
Once your vehicle is accepted by the dealership, your car’s engine will be destroyed; the rest of the vehicle will be sold to a scrap yard for parts.
How do I know if I’m eligible?
While there are thousands of makes and models of vehicles on the road today, it
can be difficult to narrow down simply exactly which vehicles are eligible. If you think your car might qualify, contact your local dealer of choice immediately. Not all dealers are required to participate, but most are choosing to be part of the CARS program because it will boost sales. As a rule of thumb, your car may be eligible if it meets these requirements:Vehicle is less than 25 years old.
Vehicle gets less than 18 miles per gallon.
Vehicles must have been continuously insured for the past year. You will be required to provide proof of car insurance coverage.
Large trucks or SUVs may have different mileage requirements/specifications to be eligible.
There is danger at every corner when it comes to Indian roads. Your brand new vehicle, and it gets hit by someone who mistakes a highway for space, and his car for a space shuttle. Insurance can pay for your financial loss, at least.
We give you the various insurance schemes, details about what is insured, the Comprehensive Cover, Third Party Insurance and much more.Other online services include insurance online service. Get your vehicle insured online, and drive without a worry. Also read on about the major insurance companies.
When it comes to auto insurance, there’s a lot of questions about who exactly is covered under your policy. For instance, can your spouse drive your vehicle under your coverage? What about a friend? Or your children? Fortunately, most car insurance companies have been doing business long enough to have seen just about every possible scenario out there. Their specific insurance policies typically lay out exactly who is insured to drive your vehicle. Here’s a general look at who most insurers will provide coverage for and who they might not while driving your vehicle:
Your Spouse - Generally, when you apply for an auto insurance policy, your provider will ask you to list your spouse’s information as well. Insurers usually just automatically assume that your spouse will also drive your vehicle every now and then. In almost every situation, your spouse should be covered.
Your Children - Assuming they are of legal age to drive and have a valid driver’s license, you can typically list your children on your auto insurance policy so that they receive coverage. Depending on the insurance company, your children may have to be listed in order to be covered. Younger drivers are more risky to ensure, so talk to your provider before assuming they’re covered.
Your Friends - Who hasn’t been in a situation where you allow a friend to borrow your car for the day? As long as you directly give someone permission to borrow your car, they will typically be covered. A situation where the driver wouldn’t be covered is if your child was to allow one of his or her friends to drive the vehicle. Another important note, friends or any non-residents are usually only covered for one-time occasions. If you plan on allowing someone to borrow your vehicle for an extended period of time, you should notify your insurer.
Exclusions
We give you the various insurance schemes, details about what is insured, the Comprehensive Cover, Third Party Insurance and much more.Other online services include insurance online service. Get your vehicle insured online, and drive without a worry. Also read on about the major insurance companies.
When it comes to auto insurance, there’s a lot of questions about who exactly is covered under your policy. For instance, can your spouse drive your vehicle under your coverage? What about a friend? Or your children? Fortunately, most car insurance companies have been doing business long enough to have seen just about every possible scenario out there. Their specific insurance policies typically lay out exactly who is insured to drive your vehicle. Here’s a general look at who most insurers will provide coverage for and who they might not while driving your vehicle:
Your Spouse - Generally, when you apply for an auto insurance policy, your provider will ask you to list your spouse’s information as well. Insurers usually just automatically assume that your spouse will also drive your vehicle every now and then. In almost every situation, your spouse should be covered.
Your Children - Assuming they are of legal age to drive and have a valid driver’s license, you can typically list your children on your auto insurance policy so that they receive coverage. Depending on the insurance company, your children may have to be listed in order to be covered. Younger drivers are more risky to ensure, so talk to your provider before assuming they’re covered.
Your Friends - Who hasn’t been in a situation where you allow a friend to borrow your car for the day? As long as you directly give someone permission to borrow your car, they will typically be covered. A situation where the driver wouldn’t be covered is if your child was to allow one of his or her friends to drive the vehicle. Another important note, friends or any non-residents are usually only covered for one-time occasions. If you plan on allowing someone to borrow your vehicle for an extended period of time, you should notify your insurer.
Exclusions
Some car insurance policies may also list a set of exclusions as to who they will not provide coverage for. For instance, some insurance policies may specifically outline that it will only cover persons living in your household. It could also exclude drivers under a certain age, such as those under 21 years old.
Uninsured Motorists Coverage
Many people get the definition of uninsured motorists coverage confused. It is not meant to protect people who drive your vehicle, rather it is to protect you in the case of an accident that was caused by a driver without coverage. In most cases, your uninsured/underinsured motorists coverage does not extend to other people driving your vehicle, even if they are listed under your insurance policy.
What Happens if Someone Driving my Vehicle Isn’t Covered?
If for whatever reason someone who drives your vehicle isn’t covered by your insurance, there is a chance that they could be covered under their own policy. Some auto insurance policies will extend their coverage to any vehicle you drive, although these are often more expensive.
Car Insurance Glossary - Terms Like Passive Alarm, Waiver, Gap, Rental Coverage & More
Welcome to our insurance glossary of car insurance terms. If you have any questions about terms that are not included on this page please .
Additional Interest: A person or other entity (i.e. a corporation) that has an insurable interest in your vehicle, and may be named as such in your insurance policy. For example, when you finance a car through a bank, the bank is considered to have an “additional interest” in the car.
Anti-Theft Device: Any device designed to reduce the chance of a vehicle being stolen, or aid in the recovery of a vehicle if it is stolen. Examples include car alarms, keyless entry, starter disablers, “The Club”; etc.
Bodily Injury Liability: Legal liability for causing injury or death to another person.
Car Insurance Coverage: There are many "coverages." Liability, medical payments, uninsured motorists, collision, and comprehensive are the five major types of car insurance coverage.
Claim: The request for reimbursement that you make to the insurance company when you’ve been injured or your car has been damaged.
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: If you have this type of coverage with your car insurance policy, your insurance company will pay your deductible if you are in an accident that is the fault of an uninsured motorist. This is not available in all states or with all policies.
Comprehensive Coverage: This coverage provides protection in the event of damage not caused by a collision (that kind of damage would be covered by your collision coverage). These other kinds of damage can include theft, fire, damage by extreme weather, etc.
Continuous Coverage: The length of time that you have maintained the legally required insurance on your vehicle. Lapses in coverage can result in higher rates.
Continuously Insured: The amount of time that you’ve been insured, without gaps. You can switch companies as many times as you want, but if you’ve let your coverage lapse, you could end up with higher premiums.
Credit Rating: Each individual consumer has a credit file with each of the three major credit bureaus - Equifax, Experian, and TransUnion. Each company uses a formula developed by Fair Issac’s; Co. (FICO) to determine the consumer’s credit rating. Insurers consider your credit rating when determining your insurance rates, since their own advanced statistical models have determined that consumers with good credit are better insurance risks, and vice versa.
Deductible: This is the amount that you are required to pay towards any damages. Your car insurance will cover any costs above this amount. The size of your deductible can greatly affect your car insurance costs.
Declarations Page (Dec Page): This is a one or two page document that details all the facts about your car insurance, such as your name and address, the vehicles covered, the deductible, the types of coverage, etc.
Defensive Driver Course: Classes offered or approved by the DMV designed to enhance defensive driving skills. Most car insurance companies offer discounts to customers who successfully complete these courses.
Depreciation: Age and wear can cause your car’s value to depreciate, or go down, over time.
Drive-Other-Car Endorsement: An endorsement or "rider" that broadens the definition of "covered auto" to include vehicles owned by others that are operated by the insured.
Earned Premium: The portion of the premium that is "consumed" during a partial policy term. If you terminate your policy early, you are only responsible for the earned premium portion (plus expenses), regardless of what you may have paid.
Effective Date: The date your coverage begins. You can find this on your dec page.
Emergency Road Service: This is optional coverage that provides services like tire changing, lock-out help, gas delivery, or towing.
Endorsements: These are also known as riders. They are changes to your coverage that are made after the effective date, like adding another car or raising your deductible.
Exclusions: Situations that are not covered by your car insurance. Your policy will show your specific exclusions.
Extraordinary Medical: This is optional coverage that protects you above and beyond your standard medical benefit coverage. Usually this would cover you if you were hospitalized long-term or permanently disabled.
Expiration Date: The date and time that your coverage ceases. Normally, the time is 12:01 AM - meaning one minute after midnight.
Extended Non-Owner Liability: An endorsement or "rider" that extends liability coverage for specifically named people operating any non-owned vehicle.
Financial Ratings: This term refers to the credit-worthiness and financial stability of insurance companies. AM Best, Standard & Poor's, and Moody's are the three agencies that assign financial ratings to insurance companies.
Financial Responsibility Laws: Each state requires motorists to be financially able to compensate the victims of bodily or property damage for which they are liable. Liability insurance is the easiest way to meet these requirements, however, those who can afford to do so may opt to post bonds instead.
Full Coverage Car Insurance: This is a confusing term. Many people think that having "full coverage" means that they will be covered no matter what happens to them. In reality, it only means that you have the full legal requirements needed in your state. Depending on your home state, it could be very little coverage in reality.
Funeral Benefits: This is optional coverage. If you were to die in a car-related accident, the insurance company would pay for a portion of your funeral costs.
Gap Insurance: Optional coverage for the difference in the amount owed on a vehicle and its replacement value. For example, if your car's replacement value is $4,000, but you still owe $5,000 on it and it’s totaled, your insurance company will only pay you $4,000 (unless you have gap insurance). The company that lent you the money for your car will require an immediate payment of $5,000. Gap insurance makes up this difference.
Garaging Location: It is assumed by car insurance companies that you keep your car at your home address. However, if you primarily keep your car in a different location, make sure your insurance company knows. It can affect your rates.
Good Student Discount: Most insurers provide discounts to high school students who receive good grades. The reasoning behind this discount is that insurers have found that students who are responsible enough to get good grades are generally more responsible drivers, and thus they pose less risk for the insurers.
HEV: Hybrid Electric Vehicle. If you drive an HEV, your rates may differ from those for a standard car. Make sure your car insurance company knows if you drive an HEV.
Hit and Run: An accident caused by someone who flees the scene before police arrive and without leaving insurance information.
Income Loss: This is optional coverage that protects you if you are in an accident that leaves you unable to work. Your insurance company can help compensate you for lost wages.
Indemnity: Restoration to the financial place you were prior to the accident. Insurance is designed to make you "whole again," but not to "enrich" you. Thus, it gives you indemnity - making you "whole" again.
Independent Agent: An agent who does not work for just one insurance company. Instead, he or she searches the market for the best place for his/her client's business.
Insurance Premium: Rates charged to an insured, reflecting the insurer's expectations for loss and adding in an element of profit. Premiums are typically paid monthly, but discounts are often offered for paying in advance, either quarterly, semiannually, or yearly.
Insurance Score: Score given to each insurance customer, based on complex statistical models, in order to determine his or her insurance risk. The better your insurance score, the lower car insurance rates you can expect to pay.
Insured: The person/people covered by an insurance contract. Insurance agreements commonly refer to the "insured" or "insureds."
Judgment: A decision by a court of law, typically ordering one party to pay another party a sum of money. Additional legal action is normally required in order to ensure that judgments are enforced. Many judgments go unenforced. When enforced, a the winner of a judgment can potentially garnish the wages and "attach" the bank accounts of the person or entity at fault.
Liability: A legal obligation to perform or not perform certain acts. Most commonly, this refers to monetary sums that must be paid in order to compensate for damages to people and/or property. The term can also be used to assign "responsibility" or "fault."
Liability Coverage: Insurance to cover damages that the insured is ordered to pay as a result of a court's decision holding the insured liable for injuries caused to people and/or property.
Lien Holder: A person or other entity (i.e. a corporation - usually a bank) with a legally securable interest in your vehicle. For example, a lending institution that loans you money for the purchase of your car has a lien on it.
Limits: The maximum amount an insurance company will pay. For example, if your collision coverage limit is $10,000, but your car sustains $15,000 worth of damage, you are liable to pay for the $5,000 worth of damage that goes beyond your insurer's limit.
Medical Payments Coverage: Insurance coverage that pays for damages sustained to the insured and his or her passengers without regard to fault. Also pays for damages suffered by the insured and covered family members for injuries sustained as a pedestrian at the hands of non-exempt vehicles.
MVR (Motor Vehicle Record): Also known as a "DL Printout," your MVR contains information about your driving record - tickets, accidents, convictions, etc.
No-Fault Insurance: Type of insurance in which the insured's own insurance company provides indemnity for damages sustained to the insured's own person and property without regard to fault. The purpose of no-fault insurance is to expedite the insurance claims process and keep cases from clogging the legal system.
No-Fault State: Any state that has at least some form of no-fault insurance as a matter of law. No state has "pure" no-fault insurance, but Michigan comes the closest.
Non-Passive Alarm: Alarm in which action on your part is required in order for it to be activated. Most insurers will offer a discount if your automobile is armed with a non-passive alarm - but a slightly greater discount if it has a passive alarm.
Passive Alarm: Alarm in which your action is not necessary in order for it to be activated. Most insurers will offer discounts for cars armed with passive alarm systems that are even greater than cars with non-passive alarms.
Personal Auto Policy (PAP): Standard car insurance policy contract that includes liability, medical payments, uninsured motorist, and physical damage protection.
Personal Injury Protection: Often called PIP, this insurance applies to no-fault states and covers the basic expenses incurred by the insured or his family in an automobile accident without regard to fault.
Physical Damage: Refers to damage to your vehicle. Such damage is normally covered by either collision or comprehensive insurance.
Pleasure Use: A vehicle that is not typically used for commuting to work or for any business purpose, but rather, primarily for enjoyment.
Policy Lapse: Any period of time in which your car is not insured. Policy lapses result in higher rates.
Policy Period: Time period in which the policy is active. Also referred to as "policy term."
Preferred Risk: Refers to an individual who is considered to present less risk to an insurer than the average motorist.
Premium: An individual's price for car insurance.
Primary Driver: The person who drives the car most frequently. If two or more people drive a car, the primary driver's record is taken into greater account than the secondary or tertiary drivers.
Primary Use: How the covered auto is most commonly used. Insurers typically classify vehicles into one of three categories - commuting (most personal autos), business use (corporate-owned or used by the self-employed for business purposes), or pleasure use.
Private Passenger Auto: A four-wheeled motor vehicle that is subject to registration and used for private (non-business) use. Examples of vehicles that would not be considered private passenger autos include dune buggies, UPS trucks, busses, ATVs, etc.
Property Damage Liability Coverage: Insurance in which the insurer pays for damages to another party's property for which the insured is held liable.
Pro-Rata Cancellation: Termination of a policy before its expiration date. In this case, policyholders are responsible only for the earned premium. Every dollar in excess of the earned premium is considered "unearned," and is to be refunded to the policyholder. Insurance companies may, however, charge small fees for fixed expenses - see "short rate cancellation," below.
Property Damage Liability Insurance: This is insurance coverage for damage caused to other people's property. Damage to one's own property is considered "physical damage" and covered by collision and comprehensive coverages.
Rental Car Reimbursement: A common rider or endorsement in which the insured is reimbursed for the cost of a rental car while his covered auto is unusable.
Secondary Driver: A driver other than the primary driver who also is insured for the particular automobile. The secondary driver's driving record is given less weight in determining the insurance rates that the insured will be charged.
Short Rate Cancellation: This term refers to the non-prorated portion of a policy that is terminated early and must be refunded. Insurance companies are allowed to allocate expenses to the front end of a policyholder's term, and therefore, the daily cost of an insurance policy goes down each day.
Split Limits: This term refers to a set of three numbers dealing with liability insurance. For example, 35/50/10 means $35,000 in bodily injury liability coverage per individual; $50,000 in bodily injury liability coverage per accident; and $10,000 of property damage liability coverage per accident.
SR-22: An official document showing proof of "financial responsibility," most commonly needed by people convicted of certain major traffic violations in order to have their driver's licenses reinstated.
tacking: Applies to underinsured motorist / uninsured motorist coverage, and allows the insured to multiply the limits of each coverage by the number of cars being insured.
State Minimum: Each state has minimum requirements on the insurance coverages that motorists must carry in order to legally drive on the public roads. These minimums are expressed by three numbers; the first and second referring to bodily injury liability limits per person and per accident, respectively, and the third number referring to the maximum property damage coverage per accident.
Steering Restraint: An anti-theft device that makes it difficult for potential thieves to access your car's ignition system. The most commonly known steering restraint is "The Club." Most insurers offer discounts for cars fitted with steering restraints.
Term: The period of time for which a policy is active.
Tort: A legal wrong, most commonly negligence or acts of omission. Courts provide remedy for torts in the form of suits for damages.
owing Coverage: Optional insurance coverage that provides payment for towing (but not repairs) if your car breaks down or is disabled as result of an accident.
Underinsured Motorists Coverage: Insurance that covers damages caused by motorists who meet the state's minimum insurance requirements but still do not have enough coverage to satisfy damages.
Uninsured Motorists Coverage: Insurance that covers damages caused by uninsured or unidentified (hit-and-run) motorists.
Unsatisfied Judgment Fund: Many states have funds that reimburse victims injured in automobile accidents who are unable to collect from the liable party.
Usage: Refers to the purpose for which you use your vehicle. Different rates are established for different usages. Example usages include "pleasure," "commute," and "business."
VIN: Vehicle Identification Number. Each car has a unique VIN, which consists of 17 numbers, and is necessary for receiving insurance coverage.
Anti-Theft Device: Any device designed to reduce the chance of a vehicle being stolen, or aid in the recovery of a vehicle if it is stolen. Examples include car alarms, keyless entry, starter disablers, “The Club”; etc.
Bodily Injury Liability: Legal liability for causing injury or death to another person.
Car Insurance Coverage: There are many "coverages." Liability, medical payments, uninsured motorists, collision, and comprehensive are the five major types of car insurance coverage.
Claim: The request for reimbursement that you make to the insurance company when you’ve been injured or your car has been damaged.
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: If you have this type of coverage with your car insurance policy, your insurance company will pay your deductible if you are in an accident that is the fault of an uninsured motorist. This is not available in all states or with all policies.
Comprehensive Coverage: This coverage provides protection in the event of damage not caused by a collision (that kind of damage would be covered by your collision coverage). These other kinds of damage can include theft, fire, damage by extreme weather, etc.
Continuous Coverage: The length of time that you have maintained the legally required insurance on your vehicle. Lapses in coverage can result in higher rates.
Continuously Insured: The amount of time that you’ve been insured, without gaps. You can switch companies as many times as you want, but if you’ve let your coverage lapse, you could end up with higher premiums.
Credit Rating: Each individual consumer has a credit file with each of the three major credit bureaus - Equifax, Experian, and TransUnion. Each company uses a formula developed by Fair Issac’s; Co. (FICO) to determine the consumer’s credit rating. Insurers consider your credit rating when determining your insurance rates, since their own advanced statistical models have determined that consumers with good credit are better insurance risks, and vice versa.
Deductible: This is the amount that you are required to pay towards any damages. Your car insurance will cover any costs above this amount. The size of your deductible can greatly affect your car insurance costs.
Declarations Page (Dec Page): This is a one or two page document that details all the facts about your car insurance, such as your name and address, the vehicles covered, the deductible, the types of coverage, etc.
Defensive Driver Course: Classes offered or approved by the DMV designed to enhance defensive driving skills. Most car insurance companies offer discounts to customers who successfully complete these courses.
Depreciation: Age and wear can cause your car’s value to depreciate, or go down, over time.
Drive-Other-Car Endorsement: An endorsement or "rider" that broadens the definition of "covered auto" to include vehicles owned by others that are operated by the insured.
Earned Premium: The portion of the premium that is "consumed" during a partial policy term. If you terminate your policy early, you are only responsible for the earned premium portion (plus expenses), regardless of what you may have paid.
Effective Date: The date your coverage begins. You can find this on your dec page.
Emergency Road Service: This is optional coverage that provides services like tire changing, lock-out help, gas delivery, or towing.
Endorsements: These are also known as riders. They are changes to your coverage that are made after the effective date, like adding another car or raising your deductible.
Exclusions: Situations that are not covered by your car insurance. Your policy will show your specific exclusions.
Extraordinary Medical: This is optional coverage that protects you above and beyond your standard medical benefit coverage. Usually this would cover you if you were hospitalized long-term or permanently disabled.
Expiration Date: The date and time that your coverage ceases. Normally, the time is 12:01 AM - meaning one minute after midnight.
Extended Non-Owner Liability: An endorsement or "rider" that extends liability coverage for specifically named people operating any non-owned vehicle.
Financial Ratings: This term refers to the credit-worthiness and financial stability of insurance companies. AM Best, Standard & Poor's, and Moody's are the three agencies that assign financial ratings to insurance companies.
Financial Responsibility Laws: Each state requires motorists to be financially able to compensate the victims of bodily or property damage for which they are liable. Liability insurance is the easiest way to meet these requirements, however, those who can afford to do so may opt to post bonds instead.
Full Coverage Car Insurance: This is a confusing term. Many people think that having "full coverage" means that they will be covered no matter what happens to them. In reality, it only means that you have the full legal requirements needed in your state. Depending on your home state, it could be very little coverage in reality.
Funeral Benefits: This is optional coverage. If you were to die in a car-related accident, the insurance company would pay for a portion of your funeral costs.
Gap Insurance: Optional coverage for the difference in the amount owed on a vehicle and its replacement value. For example, if your car's replacement value is $4,000, but you still owe $5,000 on it and it’s totaled, your insurance company will only pay you $4,000 (unless you have gap insurance). The company that lent you the money for your car will require an immediate payment of $5,000. Gap insurance makes up this difference.
Garaging Location: It is assumed by car insurance companies that you keep your car at your home address. However, if you primarily keep your car in a different location, make sure your insurance company knows. It can affect your rates.
Good Student Discount: Most insurers provide discounts to high school students who receive good grades. The reasoning behind this discount is that insurers have found that students who are responsible enough to get good grades are generally more responsible drivers, and thus they pose less risk for the insurers.
HEV: Hybrid Electric Vehicle. If you drive an HEV, your rates may differ from those for a standard car. Make sure your car insurance company knows if you drive an HEV.
Hit and Run: An accident caused by someone who flees the scene before police arrive and without leaving insurance information.
Income Loss: This is optional coverage that protects you if you are in an accident that leaves you unable to work. Your insurance company can help compensate you for lost wages.
Indemnity: Restoration to the financial place you were prior to the accident. Insurance is designed to make you "whole again," but not to "enrich" you. Thus, it gives you indemnity - making you "whole" again.
Independent Agent: An agent who does not work for just one insurance company. Instead, he or she searches the market for the best place for his/her client's business.
Insurance Premium: Rates charged to an insured, reflecting the insurer's expectations for loss and adding in an element of profit. Premiums are typically paid monthly, but discounts are often offered for paying in advance, either quarterly, semiannually, or yearly.
Insurance Score: Score given to each insurance customer, based on complex statistical models, in order to determine his or her insurance risk. The better your insurance score, the lower car insurance rates you can expect to pay.
Insured: The person/people covered by an insurance contract. Insurance agreements commonly refer to the "insured" or "insureds."
Judgment: A decision by a court of law, typically ordering one party to pay another party a sum of money. Additional legal action is normally required in order to ensure that judgments are enforced. Many judgments go unenforced. When enforced, a the winner of a judgment can potentially garnish the wages and "attach" the bank accounts of the person or entity at fault.
Liability: A legal obligation to perform or not perform certain acts. Most commonly, this refers to monetary sums that must be paid in order to compensate for damages to people and/or property. The term can also be used to assign "responsibility" or "fault."
Liability Coverage: Insurance to cover damages that the insured is ordered to pay as a result of a court's decision holding the insured liable for injuries caused to people and/or property.
Lien Holder: A person or other entity (i.e. a corporation - usually a bank) with a legally securable interest in your vehicle. For example, a lending institution that loans you money for the purchase of your car has a lien on it.
Limits: The maximum amount an insurance company will pay. For example, if your collision coverage limit is $10,000, but your car sustains $15,000 worth of damage, you are liable to pay for the $5,000 worth of damage that goes beyond your insurer's limit.
Medical Payments Coverage: Insurance coverage that pays for damages sustained to the insured and his or her passengers without regard to fault. Also pays for damages suffered by the insured and covered family members for injuries sustained as a pedestrian at the hands of non-exempt vehicles.
MVR (Motor Vehicle Record): Also known as a "DL Printout," your MVR contains information about your driving record - tickets, accidents, convictions, etc.
No-Fault Insurance: Type of insurance in which the insured's own insurance company provides indemnity for damages sustained to the insured's own person and property without regard to fault. The purpose of no-fault insurance is to expedite the insurance claims process and keep cases from clogging the legal system.
No-Fault State: Any state that has at least some form of no-fault insurance as a matter of law. No state has "pure" no-fault insurance, but Michigan comes the closest.
Non-Passive Alarm: Alarm in which action on your part is required in order for it to be activated. Most insurers will offer a discount if your automobile is armed with a non-passive alarm - but a slightly greater discount if it has a passive alarm.
Passive Alarm: Alarm in which your action is not necessary in order for it to be activated. Most insurers will offer discounts for cars armed with passive alarm systems that are even greater than cars with non-passive alarms.
Personal Auto Policy (PAP): Standard car insurance policy contract that includes liability, medical payments, uninsured motorist, and physical damage protection.
Personal Injury Protection: Often called PIP, this insurance applies to no-fault states and covers the basic expenses incurred by the insured or his family in an automobile accident without regard to fault.
Physical Damage: Refers to damage to your vehicle. Such damage is normally covered by either collision or comprehensive insurance.
Pleasure Use: A vehicle that is not typically used for commuting to work or for any business purpose, but rather, primarily for enjoyment.
Policy Lapse: Any period of time in which your car is not insured. Policy lapses result in higher rates.
Policy Period: Time period in which the policy is active. Also referred to as "policy term."
Preferred Risk: Refers to an individual who is considered to present less risk to an insurer than the average motorist.
Premium: An individual's price for car insurance.
Primary Driver: The person who drives the car most frequently. If two or more people drive a car, the primary driver's record is taken into greater account than the secondary or tertiary drivers.
Primary Use: How the covered auto is most commonly used. Insurers typically classify vehicles into one of three categories - commuting (most personal autos), business use (corporate-owned or used by the self-employed for business purposes), or pleasure use.
Private Passenger Auto: A four-wheeled motor vehicle that is subject to registration and used for private (non-business) use. Examples of vehicles that would not be considered private passenger autos include dune buggies, UPS trucks, busses, ATVs, etc.
Property Damage Liability Coverage: Insurance in which the insurer pays for damages to another party's property for which the insured is held liable.
Pro-Rata Cancellation: Termination of a policy before its expiration date. In this case, policyholders are responsible only for the earned premium. Every dollar in excess of the earned premium is considered "unearned," and is to be refunded to the policyholder. Insurance companies may, however, charge small fees for fixed expenses - see "short rate cancellation," below.
Property Damage Liability Insurance: This is insurance coverage for damage caused to other people's property. Damage to one's own property is considered "physical damage" and covered by collision and comprehensive coverages.
Rental Car Reimbursement: A common rider or endorsement in which the insured is reimbursed for the cost of a rental car while his covered auto is unusable.
Secondary Driver: A driver other than the primary driver who also is insured for the particular automobile. The secondary driver's driving record is given less weight in determining the insurance rates that the insured will be charged.
Short Rate Cancellation: This term refers to the non-prorated portion of a policy that is terminated early and must be refunded. Insurance companies are allowed to allocate expenses to the front end of a policyholder's term, and therefore, the daily cost of an insurance policy goes down each day.
Split Limits: This term refers to a set of three numbers dealing with liability insurance. For example, 35/50/10 means $35,000 in bodily injury liability coverage per individual; $50,000 in bodily injury liability coverage per accident; and $10,000 of property damage liability coverage per accident.
SR-22: An official document showing proof of "financial responsibility," most commonly needed by people convicted of certain major traffic violations in order to have their driver's licenses reinstated.
tacking: Applies to underinsured motorist / uninsured motorist coverage, and allows the insured to multiply the limits of each coverage by the number of cars being insured.
State Minimum: Each state has minimum requirements on the insurance coverages that motorists must carry in order to legally drive on the public roads. These minimums are expressed by three numbers; the first and second referring to bodily injury liability limits per person and per accident, respectively, and the third number referring to the maximum property damage coverage per accident.
Steering Restraint: An anti-theft device that makes it difficult for potential thieves to access your car's ignition system. The most commonly known steering restraint is "The Club." Most insurers offer discounts for cars fitted with steering restraints.
Term: The period of time for which a policy is active.
Tort: A legal wrong, most commonly negligence or acts of omission. Courts provide remedy for torts in the form of suits for damages.
owing Coverage: Optional insurance coverage that provides payment for towing (but not repairs) if your car breaks down or is disabled as result of an accident.
Underinsured Motorists Coverage: Insurance that covers damages caused by motorists who meet the state's minimum insurance requirements but still do not have enough coverage to satisfy damages.
Uninsured Motorists Coverage: Insurance that covers damages caused by uninsured or unidentified (hit-and-run) motorists.
Unsatisfied Judgment Fund: Many states have funds that reimburse victims injured in automobile accidents who are unable to collect from the liable party.
Usage: Refers to the purpose for which you use your vehicle. Different rates are established for different usages. Example usages include "pleasure," "commute," and "business."
VIN: Vehicle Identification Number. Each car has a unique VIN, which consists of 17 numbers, and is necessary for receiving insurance coverage.
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