16 Most Important Car Insurance Terms

1. Accident
A sudden, fortuitous event or an unexpected, unforeseen event, not under the control of an insured and resulting in a loss. Often used to refer to a collision or insurance event.
2. Claim
Any request or demand for payment under the terms of the insurance policy.
3. Deductible
Usually, a dollar amount the insured must pay on each loss to which the deductible applies. The insurance company pays the remainder of each covered loss up to the policy limits.
4. Application
A signed statement by a prospective insured requested insurance. This can be signed electronically.
5. Hit and Run
An accident caused by someone who does not stop to assist or provide information.
6. Policy
The written documents of a contract for insurance between the insurance company and the insured. Such documents include forms, endorsement, riders and attachments.
7. Insurance
A system inwhich groups of people who have similar chances of suffering a loss transfer their risk of loss to an insurer who pools the risk of many people together. In exchange for paymeny of premium, the insurer promises to reimburse the person for their covered losses.
8. Policyholder
One who maintains ownership in an insurance policy. This may refer to the policy owner or those covered under the policy. See also Named Insured.
9. Renewal
The process of keeping an active policy in force through the issuance of a renewal policy.
10. Third Party Liability Insurance
Insurance providing money on behalf of the policyholder to pay because of bodily injury or property damage caused to another person and covered in the policy.
11. Non-renewal
When an insurer decides not to renew a policy at the end of its policy period.
12. Third Party Claim
Claim for injury or damage to property of a third party alleged tohave been caused by the insured.
13. Proof of Loss
A statement made regarding the extent ofthe claim; it may be requested in accordance with the conditions of the policy.
14. Exclusion
Section of the insurance policy, which list property, perils, person, or situations which are not covered under the policy.
15. Fraud
A false statement intended to deceive the insurer and induce it to part with something of value or surrender a legal right. May void a policy.
16. Hazard
Anything that increases the chance of an accident occuring.

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16 Most Important Car Insurance Terms

16 Most Important Car Insurance Terms