Auto Insurance Terms H-O

Glossary of defined terms

Hit and Run
An accident caused by someone who leaves the scene without stopping to assist or provide information.


ID Card
Insurers issue an identification card that provides proof of insurance. Typically the card shows company and agent contact information, policy number, and dates policy is in effect as well as the name of the policy holder and the vehicle covered. Most states require that you carry such proof on you or in your vehicle at all times.


Lapse in Coverage/Policy Lapse
Coverage can be canceled or terminated for failure to pay premiums, or for other reasons such as change in provider. Either party can cancel a policy.

Lender
A lender is the institution which grants a loan, such as a bank.

Lessor/Lessee
The lessor is the organization that leases a vehicle and to whom you make your lease payments. You are the lessee—that is, the person leasing the vehicle.

Loss Payee/Lien holder
This is usually the lendor or lessor, which has a legally secured insurable interest in the vehicle. The car is the loan collateral. Typically the loss payee or lien holder requires adequate insurance so if the car is damaged in an accident, they will be able to recover the loss.


Medical Payments
Also referred to as Personal Injury Protection, this covers the cost of injuries incurred by you, your family, or passengers regardless of fault. This coverage extends not only to your vehicle but includes pedestrian accident injuries as well. This coverage is required in some states, but not all.

Multi-car discount
For drivers who own several cars, insurance companies frequently provide a discount for insuring all vehicles under the same policy. By consolidating coverage under one policy, drivers can realize a significant savings over individual policies.


Named Insured
Any person or entity specified by name as the insured by the policy. Others, such as employees, may be covered by definition even though their names aren´t on the policy.

Named Non-Owner Policy
An endorsement that specifically provides coverage persons who operate any non-owned automobile on a regular basis, such as driving a company car.

No-Fault Insurance
Fewer than one third of the states have "no fault" insurance. This insurance covers insured drivers, regardless of fault in an accident, for a range of benefits that may include medical costs, loss of wages, and funeral expenses. In return for this benefit, limits are typically placed on rights to sue.

Non-Owned Auto
A vehicle that is not owned by the insured and is instead borrowed or leased. Typically the vehicle is used for business.


Information from Coverage For My Car

 Web Demesne
  
  
Support Demesne through our Bookstore