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Actual Cash Value
Your cars actual cash value (ACV) is the price at which a vehicle can
actually be replaced in the local auto market – usually within close proximity
to where the vehicle is used or garaged. ACV can be different than “book value,”
which usually refers to published valuations used by retail auto dealers and banks
across wide geographic areas.
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Adjuster
An adjuster is the person who works for an insurance company to investigate, evaluate
and negotiate auto insurance claims – also known as a claim representative or claim examiner.
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Appraiser
An auto appraiser is the person who works for an insurance company to estimate the
physical damage to vehicles from accidents.
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Benefit
A benefit is the amount paid by an auto insurance company to satisfy its obligations
arising from claims.
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Bodily Injury
Bodily Injury is generally defined as bodily harm, sickness or disease, including death.
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Bodily Injury Liablity Coverage
Bodily injury liability coverage protects the policy holder (up to defined limits) if you
are held responsible for injuring someone in a car accident. This coverage helps pay for
the injured partys medical expenses and lost wages. Bodily injury liability may also help
pay your expenses in defending a lawsuit against the policy holder arising from a car accident.
The amount covered is capped at the limits you select when you buy your auto insurance policy.
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Business Use
Business use means using your private car for any business or business related purposes,
including retail deliver of any kind, including but not limited to pizza or newspaper delivery.
Many personal auto policies, exclude business use unless a specific business use endorsement
is purchased with the policy.
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Claim
An auto insurance claim is a policyholders request to be reimbursed for a loss thats covered
by car insurance.
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Claim Denial
Claim denial can occur when a policy, policy coverage or benefit is deemed not to apply.
For example, a policy may have lapsed or is out-of-force at the time of an accident.
Other common causes of claim denial are due to specific exclusions in the policy or the
policy holder’s failure to meet certain obligations as defined by the policy. Also, fraud,
deception or material misrepresentation can lead to claim denial.
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Claimant
Generally the term “claimant” refers to the “other party” who is making a claim against
the policy holder but it may also be use to describe any person making a claim.
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Collision Coverage
Collision coverage is designed to pay for the repair or replacement of the policy holder’s
car if damaged in a compensable accident. Collision coverage usually requires the policy holder
to pay a portion of their damages – a “deductible.” The maximum amount paid for repair or
replacement is the cars actual cash value, minus the amount of the deductible you choose when
you buy your auto insurance policy.
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Collision Deductible Waiver
This auto insurance coverage pays the deductible for your collision coverage if you are involved
in an accident in which an uninsured motorist is held legally responsible. Most personal auto policies
don’t automatically contain this coverage. Very often auto rental companies will offer this coverage when
you rent a vehicle.
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Comprehensive Coverage (Other than Collision)
Comprehensive coverage (also called Other-than-Collision) is designed to pay for the repair
or replacement of the policy holder’s car if damaged by certain defined events such as: a
vehicle theft, vehicle fire, certain natural disasters, falling objects, and vandalism.
The maximum amount paid for repair or replacement is the cars actual cash value, minus the
amount of the deductible you choose when you buy your auto insurance policy.
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Continuously Insured
The length of time you have been continuously insured is the number of years you have been
covered by one or more insurance companies without a lapse in your auto insurance coverage
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Declarations Page
The declarations page of your auto insurance policy is a summary of the essential coverages
and limits of your auto insurance policy, including: the policyholders name and address, a
description of the insured vehicles, the auto insurance premium, as well as the coverages,
limits, and deductibles.
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Deductible
A deductible is the amount of damages the policy holder pays toward the repair or replacement
of a vehicle, while the insurance policy pays the remainder (within certain limits).
Though choosing a higher deductible can substantially lower your auto insurance premium,
if you file an auto insurance claim, you will have to pay the higher deductible out of your
own pocket in order to receive payment from your auto insurance company.
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Depreciation
Depreciation is the decline in an objects value due to age, wear and tear, or obsolescence.
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Effective Date
The effective date is the date your auto insurance coverage begins. You are not covered by
car insurance prior to an auto insurance policys effective date.
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Endorsements
Also known as riders, endorsements are changes to the original insurance contract
which may add or modify certain coverages. In auto insurance, endorsements may include
changing your deductibles, adding a new car or broadening your auto insurance policy.
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Exclusions
Exclusions are situations where the insurance policy does NOT offer a coverage or benefit.
Specific exclusions are listed in your auto insurance policy.
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First Party
First party generally refers to the policy holder. A first party claim is a petition by
the policy holder for certain benefits under the policy -- usually collision, comprehensive
or personal injury protection. Third party claims will be defined later in this list.
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Funeral Benefits
Funeral benefits coverage is sometimes a part of your auto insurance policys
Personal Injury Protection or First Party Benefits plans. If a covered individual
dies from accident-related injuries, this auto insurance coverage pays for a portion
of funeral expenses, regardless of who is at fault in an accident. Covered costs
are subject to the limits you choose when you buy your auto insurance policy.
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Garage State
The garaging location is where your insured car is kept, stored or parked most of the
time. This location is usually indicated by the ZIP Code of the policyholders primary
residence. Your garaging location can affect your auto insurance rates. Truthfully
disclosing the garaging location is very important since “material misrepresentation”
can be a cause for a claim to be denied.
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Income Loss
Income Loss coverage is sometimes a part of your auto insurance policys Personal
Injury Protection or First Party Benefits plans. Income loss coverage protects
you if you are unable to work due to accident-related injuries. This auto
insurance coverage helps you recover portions of your lost salary and other
expenses you may incur as you try to return to work. Coverage is subject to the
limits you choose when you buy your auto insurance policy.
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Indemnity
Indemnity essentially means to restore the person or property to a pre-loss condition.
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Insuranble Interest
Insurance claim reports provide details about auto insurance claims you or other
insured drivers have filed with insurance companies. These reports are provided
by independent consumer reporting agencies that collect auto insurance claim information
from a variety of insurance companies. One of the most common agencies issuing such
reports is C.L.U.E., the Comprehensive Loss Underwriting Exchange.
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Insurance Claim Report
Insurance claim reports provide details about auto insurance claims you or other
insured drivers have filed with insurance companies. These reports are provided
by independent consumer reporting agencies that collect auto insurance claim information
from a variety of insurance companies. One of the most common agencies issuing such
reports is C.L.U.E., the Comprehensive Loss Underwriting Exchange.
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Insurance Score
Insurance scores are based on analytical models that objectively measure the relative
likelihood of future insurance losses based on your credit history. These scores and
analyses of their significance are provided by independent consumer reporting agencies.
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Insured
The insured is an individual covered by a given auto insurance policy, sometime called a policy holder.
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Judgment
A judgment is a legal decision rendered by a court of law. For example, in a lawsuit
related to an auto accident, where Kate hit Eric’s fence, the court determined that Kate
was wholly responsible for the accident. The judgment determined that Kate should pay for
the costs of repairing Eric’s fence.
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Liability
Liability is a term that broadly means legal responsibility. If you run a stop sign and
hit another car, you may be found liable for the damages to the other drivers car.
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Liability Coverage
Liability coverage protects you (within limits) against financial loss if you are held
responsible (Liable) for injuries or damages to others arising from a car accident.
The two main types of liability coverage in an auto insurance policy are bodily injury
and property damage.
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Limits
Limits are the maximum amounts an insurance company will pay for a covered loss.
Though you can choose several levels of limits for certain coverages, some states
require you to buy certain minimum levels of auto insurance coverage. In such states,
you will have to choose limits that at least meet your states auto insurance requirements.
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Motor Vehicle Report
A Motor Vehicle Report (MVR) provides information on your driving record.
This report includes accidents and moving violations. Auto insurance companies
obtain MVRs from states where you or other insured drivers have been licensed
to drive.
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Personal Injury Protection
Personal Injury Protection, or PIP, is a kind of auto insurance coverage required in
certain states. PIP insurance coverage pays (within limits) medical bills and/or
funeral expenses if a covered driver and/or accompanying passengers are injured or
killed while in an insured vehicle, regardless of fault in an accident. This may
also cover policyholders and their family members when in others vehicles, or when
policyholders and their family members are on foot and hit by a car. The amount paid
by medical payments coverage is capped at the limit you choose when your buy your auto
insurance policy. PIP also contains a lost wage benefit and a benefit for reasonably
necessary household services. Consult your policy for the limits to this coverage.
to drive.
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Policy Expiration Date
Your auto insurance policys expiration date is the date when auto insurance coverage
ends if your auto insurance policy is not renewed. The expiration date can be found
on the declarations page of your auto insurance policy, on a proof of insurance card, or on a
recent auto insurance renewal notice.
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Policy Term
A policy term is the length of time an auto insurance policy is valid, usually 6
months -- so long as premiums are paid.
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Premium
The consideration (money payment) made by the policy holder to activate or maintain
an in-force insurance policy.
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Primary Driver
The primary driver is the person who drives a car most frequently.
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Primary Use
A vehicles primary use is how the car is typically used. Auto insurance
companies usually classify primary use as personal use, commuting, or pleasure use.
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Primary Policy Holder
The primary policyholder is the person who purchases the insurance or serves as the
main point of contact with the agent or company. Typically, the primary policyholder
is also the person billed for your auto insurance policy. Since he/she is the main
point of contact, we need the primary policyholders valid email address so that we
can send account updates, auto insurance renewal notices, and other policy-related communication.
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Property Damage Liabitliy Coverage
Property damage liability coverage protects you if you are held responsible for damaging
someone elses property in a car accident. Property damage coverage helps you reimburse
another person for their damaged property (such as a car, a fence, or a home). This type
of auto insurance coverage also helps pay your expenses in a related lawsuit. The amount
covered by property damage liability is capped at the limit you choose when you buy your
auto insurance policy.
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Rental Car Reimbursement
Rental car reimbursement is an optional kind of auto insurance coverage that helps pay
for your rental car expenses if an insured car is damaged or stolen and you need a rental
car. It’s called “reimbursement” because the policy holder must first incur the costs,
then submit for reimbursement. The term of allowable rental days will be determined by
the claim representative and auto appraiser. Any rental days used beyond that limit,
will be the responsibility of the policy holder. The daily rental cost limit is $20 including
all taxes and fees.
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SR-22
An SR-22 is an official document that shows proof of financial responsibility. Motor Vehicle
Departments may require an SR-22 or a similar form for people convicted of certain traffic
violations. If an SR-22 is needed, please call your agent.
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Salvage Title
The remains of a vehicle which is deemed to be a total loss is called the salvage. Even though
a vehicle is totaled, it likely has some value – the salvage value -- even if only for used parts
or scrap metal. In some cases a policy holder may wish to retain the salvage and its value will
be considered by the claim representative when making claim payments or settlements.
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Tort
Tort is a legal term used to describe instances when someone is deemed legally responsible for
injuring another person or damaging his/her person or property.
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Total Loss
Total Loss
A total loss occurs when the cost to repair a damaged vehicle is reasonably expected
to exceed the vehicle’s actual cash value (ACV). Said another way, a vehicle can be
replaced for the same or less than the cost to repair it.
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Towing Coverage
This type of auto insurance coverage is optional, and pays a fixed amount toward
towing if your car breaks down or if its disabled in an accident. The amount and
frequency of allowable payment is limited by the terms of the policy.
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Underinsured Motorist Bodily Injury Coverage
This type of auto insurance coverage pays for your medical expenses, lost wages, and
other damages when you or your passengers are injured in an accident caused by a driver
who has insufficient auto insurance coverage. The amount covered by underinsured motorist
bodily injury is capped at the limit you choose when you buy your auto insurance policy.
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Underinsured Motorist Property Damage Coverage
This type of auto insurance coverage protects you if your car is damaged in an accident
caused by a driver who has insufficient auto insurance coverage. The amount covered by
underinsured motorist property damage is capped at the limit you choose when you buy
your auto insurance policy.
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Uninsured Motorist Bodily Injury Coverage
This kind of auto insurance coverage pays for your medical expenses, lost wages, and other
general damages when you or your passengers are injured in an accident caused by a driver
who has no car insurance. The amount covered by uninsured motorist bodily injury is capped
at the limit you choose when you buy your auto insurance policy.
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Uninsured Motorist Property Damage Coverage
This kind of auto insurance coverage protects you if your vehicle is damaged in an
accident caused by a driver who has no car insurance. The amount covered by uninsured
motorist bodily injury is capped at the limit you choose when you buy your auto insurance
policy. In most cases, you will need to pay a deductible each time you file an auto insurance claim.
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Vehicle Identification Number (VIN)
The VIN, short for Vehicle Identification Number, is the unique 17-digit number found on
every car. The VIN contains the vehicles serial number, as well as abbreviations for the
make, model, and year. The VIN appears on your vehicle registration card. It is also
engraved in your car, near the base of the windshield on the drivers side dashboard and/or
on the edge of the drivers side door.
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