Actual Cash Value
The overall cost to repair a vehicle or property once depreciation has been detracted from the original purchase price.
Benefit
The sum paid by an auto insurance company to the policyholder or other beneficiary once a claim has been made.
Bodily Injury Liability
A basic inclusion of auto insurance coverage that is applicable to most policies. Bodily injury liability covers the cost of medical treatment and injuries sustained by third party drivers.
Claim
A request for reimbursement from the holder of an auto insurance policy. Claims are usually made for losses covered by the terms and conditions of the certificate of insurance.
Collision
Impact-related incident resulting in damage to the vehicle of the policyholder, vehicles belonging to third parties or any other property. This can include homes, fencing, street lamps and curbing.
Comprehensive
Coverage relating to damage caused to the vehicle of the policyholder that is not directly related to a collision or road traffic accident. Comprehensive auto insurance coverage can apply to fire, theft, adverse weather conditions, falling objects, earthquakes and civil disorder.
Deductible
A percentage of losses that are covered by the policyholder in the event of an accident. The deductible figure alleviates part of the risk absorbed by the auto insurance company and is usually used as a form of reducing premiums. However, a high deductible figure can result in serious out-of-pocket expenses for the policyholder if an accident actually occurs.
Endorsements
Changes to the terms and conditions of an original auto insurance contract such as a change in the deductible figure or the addition of another driver to a policy.
Exclusions
A series of situations that will not be included under the terms and conditions of an auto insurance policy. Exclusions will usually be stipulated on certificate of insurance.
Extraordinary Medical Coverage
A form of coverage that pays for extensive medical costs and treatment to injuries that are not contained within the terms of conditions of personal injury protection. In most cases, the limits of personal injury protection must be exhausted before extraordinary medical coverage comes into effect.
Full Coverage
An indication that all of the minimum mandatory auto insurance requirements for an individual state have been met.
Income Loss Coverage
A form of auto insurance coverage that is included as part of personal injury protection that provides payments to the policyholder if they are unable to work because of accident –related injuries.
Indemnity
A sum paid for a covered loss that is predetermined within the terms and conditions of an auto insurance policy.
Limits
The maximum level that an auto insurance company will pay out in the event of a claim. Many US states have a series of mandatory minimum limits in place to ensure that drivers are sufficiently insured
Personal Injury Protection
Also know as medical payment coverage, personal injury protection covers the cost of treatment for the policyholder or any passengers travelling in a vehicle at the time of a road traffic accident.
Property Damage Liability
A payment that covers losses incurred by third party persons for damage to personal property.
SR-22
A form of documentation that shows proof of financial responsibility after a driver has been the subject of a traffic violation.
Uninsured/Underinsured Motorist Coverage
A form of auto insurance coverage that pays for medical treatment to the policyholder and damage to their vehicle or property if they are involved in accident with an uninsured or underinsured motorist.