What do the terms mean when researching car insurance? They become even more important when you start looking at coverage. On our associated pages, the terms are explained and demystified so you can make the decisions that work best for you and your family.
Additional Insured or Additional Interest
As the policyholder, you may specify any other person or organization for coverage under your auto policy. For example, your children or employees of your company may be added as the Additional Insured on your policy. If you lease your your car, the leasing company may specify in the contract who the Additional Insured may be as well as a lien holder or loss payee. This protects the leasing company if it´s named in a lawsuit for an accident caused by a policyholder.
Equipment or devices designed to prevent or reduce the likelihood of a vehicle being vandalized or stolen. This includes devices that provide electronic tracking or otherwise aid in recovery. Examples include car alarms and motion detectors, keyless entry, starter disablers, etching parts of the vehicle with the Vehicle Identification Number, as well as tracking and global positioning systems, and other recovery devices.
Insurers typically resist accepting certain risks unless required by state law. With a provision of assigned risk under state law, insurers agree to accept their share of the risks. Assigned risk varies from state to state. A qualified agent can provide more detail.
Insurance designed to protect against losses involving cars. Various kinds are available depending on the auto owner's needs, desires, and state mandates. Insurance coverage includes different types of coverage such as bodily injury and property damage liability, and medical, collision, and comprehensive coverage for damage to the insured's vehicle.
Automobile Insurance Plans
Plans that are the equivalent of assigned risk plans, which are established and overseen by the state. Such plans aid drivers in obtaining insurance who might not qualify for coverage through standard insurance carriers. See Assigned Risk.
Basic Auto Policy
In the current market, the Basic Auto Policy has been superseded by the Personal Auto Policy. It may still be used to cover substandard risks, motorcycles, and fleet vehicles, which combines both physical damage coverage and liability insurance for claims arising out of the ownership or use of a car.
Basic Limits of Liability
State law specifies the least amount of insurance that must be in force for car owners; this effectively creates a basic limit. To establish base rates, an insurance carrier uses the basic limits as a starting point. These rates vary from state to state.
Bodily Injury Liability
Legal liability for causing physical injury or death of another. State minimums for bodily injury coverage typically apply in all policies though the amount may vary from state to state.
Combined Single Limit
Bodily Injury and Property Damage coverage may be combined in a single amount.
Agent compensation included in premium that covers agent's services.
In the event of an event other than a collision or rollover, comprehensive coverage kicks in. It may cover, among other things, fire, theft, vandalism, and toppling trees. Check your policy for what is included and excluded.
Continuous Coverage or Continuous Liability Insurance
Continuous coverage refers to the length of time you have maintained insurance on your vehicle.
This refers to the named insured as well as others including spouse, children, and others specified, who are covered under the insurance contract.
Customized Equipment/Special Equipment
Some items are not included in the standard insurance for vehicles. The option to cover them exists under a custom list of features such as electronic equipment, special exterior features and paint, or amenities added to the interior of the vehicle.
Information from Coverage For My Car