Deciphering Auto Insurance Terms
Your auto insurance policy is written with a variety of terms that are common parlance within the industry. Those terms are not necessarily ones with which you’re familiar. It pays to understand the terms used in your auto policy. It will save you time and trouble in the event you need to file a claim and its underpaid or denied.
Comprehensive Coverage
This will pay for damage to your covered vehicle or loss for any event other than a collision. It covers fire, theft, vandalism, windstorm and flood.
Deductible
The deductible is the portion you pay to have your vehicle repaired or replaced. The higher the deductible the more you’ll pay out of pocket, but you’ll typically receive a discount on premiums for carrying a higher deductible.
Depreciation
Your car or truck becomes a 1 owner vehicle the moment you sign the agreement to purchase. It also begins to depreciate – lose value.
Endorsement
This is a change to the policy that alters the original policy in some way. It’s typically used when you want to include additional coverage.
Liability
You’re legally responsible and obligated to compensate an individual harmed by your actions. A comprehensive auto policy does this for you.
Liability Limits
This is the maximum amount that the insurer will pay toward a covered event. You choose the coverage limits when you purchase a policy.
No-Fault
This is a type of insurance that will cover lost wages and medical bills, no matter who is at fault in an accident.
Peril
Your auto insurance will include named perils for which your insurance will provide coverage and payment.
Premium
The premium is the total cost of your insurance. It can be paid all at once for the entire year, or in monthly installments.
Primary Use
This is the primary reason that you use your vehicle. The most common usage is for work, followed by business and pleasure. Work or business may also be the primary usage for a vehicle used a farm, ranch or orchard.
Reimbursement
In the insurance industry, this is the money the insurance company pays you for damages on a covered loss if you file a claim.
For more information about how The Sena Group can help you with any
of your insurance needs, please contact us at 561-391-4661.
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The Sena Group
6501 Congress Ave., Ste. 100
Boca Raton, FL 33487
