The following descriptions are intended to assist you in understanding certain general insurance terms, primarily geared towards automobile insurance. The descriptions are broad in nature and are not intended to create any kind of contractual obligation or any binding of coverage. In the event of a claim, all coverage questions will be resolved by each individual insurance companies’ claims department.

Bodily Injury Liability (BI):

Coverage, subject to limits chosen by you, designed to pay claims against you and/or the cost of your legal defense if you injure or kill another person while driving your vehicle. Minimum California state Bodily Injury Liability requirements are currently $15,000/$30,000.

 

Cancellation:

The termination of an insurance policy, requested by the insured or the insurer, during the insurance policy period.

 

Claim:

The request for payment/compensation according to the details of an insurance contract.

 

Collision Coverage:

Coverage designed to pay for damages to your auto resulting from impact with another vehicle or object. This coverage is not required by law in California. This coverage may be required by your finance company in order to finance/lease a vehicle.

 

Deductible:

The portion of the cost of a loss that the insured retains. In most cases, the larger the deductible, the lower the cost of the insurance.

 

Endorsement:

An attachment to the original insurance contract that makes some type of change or amendment.

 

Insured:

The party involved in an insurance contract who pays a premium to an insurer in return for insurance protection.

 

Lapse:

A time period when an insurance policy is not in force, usually because payment and/or information was not received in a timely manner.

 

Marital Status:

Single -- An operator who is not married or is legally separated is classified as single.

Married -- An operator who is living with a spouse and meets the local definition of married. Some insurance companies recognize domestic partnerships and others do not.

 

Medical Payments:

        Coverage, subject to limits chosen

        by you, designed to protect you, your

        family members, other occupants of

        your auto, and persons not

        occupying your auto if they are injured

        as a result of an accident with your

        auto. This coverage is not required by

        law in California.

 

Named Insured:

The insured(s) whose name appears on the Policy Declarations.

 

Non-Renewal:

An insurance company’s decision not to renew an insurance contract at the end of a policy period.

 

Other Than Collision:

This coverage provides payment for damages to your auto which occur from circumstances other than those caused by impact with another vehicle or object. The list of covered circumstances may include damages resulting from fire, theft, flood, hail, vandalism, etc. This coverage is not required by law in California . This coverage may be required by your finance company in order to finance/lease a vehicle.

 

Peril:

A specific cause of loss (collision, theft, fire, etc.)

 

Premium:

The money paid to the insurance company, by the insured, for insurance coverage.

 

Property Damage Liability (PD):

Coverage, subject to limits chosen by you, designed to pay claims against you and/or the cost of your legal defense if, while driving your auto, you cause damage to the property of others. Minimum California state Property Damage Liability requirements are currently $5,000.

 

Towing and Labor Coverage:

USUALLY ONLY AVAILABLE IF OTHER THAN COLLISION COVERAGE AND/OR OTHER THAN COLLISION COVERAGE AND COLLISION IS/ARE PURCHASED. Some companies offer this coverage to provide reimbursement up to the amount stated should your auto need to be towed. This coverage is not required by law in California.

 

Transportation Expenses/Rental Reimbursement:

USUALLY ONLY AVAILABLE IF OTHER THAN COLLISION COVERAGE AND/OR OTHER THAN COLLISION COVERAGE AND COLLISION IS/ARE PURCHASED. Coverage designed to pay for temporary transportation expenses/rental vehicles in the event of a loss to a covered auto. This coverage is not required by law in California.

 

Vehicle Identification Number (VIN #):

Usually a seventeen (17) character alpha-numeric identifier. It is unique to each vehicle and distinguishes characteristics of the vehicle such as year, make, model and engine specifics. The VIN# is usually located on the driver's side of the dashboard or inside the driver’s side door.

 

Uninsured Motorist Coverage (UM BI):

Coverage, subject to limits chosen by you, designed to provide protection for you, your family members and others in your auto for injuries caused by a legally responsible party who did not have insurance in effect at the time of the accident. It must be proven, however, that the party who was at fault was UNINSURED AT THE TIME OF THE ACCIDENT. This coverage MAY provide some protection for you for injuries caused by a legally responsible party who strikes your vehicle and then leaves the scene of the accident without providing you any information. This coverage is not required by law in California.

Uninsured Motorist Coverage (UM PD):

        Coverage, subject to limits chosen by

        you, designed to provide protection

        against damages to your auto caused

        by a legally responsible party who did

        not have insurance in effect at the

        time of the accident. It must be

        proven, however, that the party who

        was at fault was UNINSURED AT THE

          TIME OF THE ACCIDENT. This

        coverage MAY also provide some

        protection for your auto for injuries

        caused by a legally responsible party

        who strikes your vehicle and then

        leaves the scene of the accident

        without providing you any information.

        This coverage is not required by law in

        California .

 

Zip Code:

A five digit postal code to aid in the sorting of mail.