Auto Insurance Market

Insurer

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This is an organization or company that provides insurance to individuals or other organizations. This company's insurance can be in any form, ranging from auto insurance, life insurance, health insurance and others.

They are usually a lot of insurance providers across the globe. The terms and conditions as well as their requirements for the insured varies from one to the other according to law.

Insured

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This is a qualified entity (person or organization) who is covered by an insurer after buying a policy from the insurer or insurance company through paid premiums.

As long as the individual or organization is covered by the insurance company he/she is bound by the terms of the company.

Insurance Fraud

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It is an illegal act of exaggerating or falsifying the facts of a damage or accident to an insurer or insurance company in order to have a claim that would otherwise not been made. This is a criminal offence that could result in the termination or closure of a policy.

This may take the form of medical bills that are inflated, exaggerating injuries sustained in an accident, staged accidents.

Insurance

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This is a policy or system in which people who have the chance to suffer a loss pass the risk of loss involved, to an insurance company by paying money (premiums) to the insurer or company for any loss resulting from a damage or accident, which in turn this insurance company promises to pay back to this individuals as a reimbursement when there eventually occurs a casualty.

The method of operation and premiums paid as well as the legal requirements differ from one insurance company to the other according to local law.

Independent Agent

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Also called independent adjuster; this is an individual who is a professional in insurance and calculate losses on behalf of an insurer or insurance company he represents, but is not an employer of the insurance company.

They are normally paid on commission basis from all policies sold by the insurance companies they are representing.

Indemnification

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What advantage would an insurance coverage serve without the act of an insurer compensating the loss of an insured or entity in order to restore the individual to the approximate or appropriate condition or financial position before the loss.

The ways of compensation differ from one insurance company to another. But basically the loss of the policyholder resulting from any form of casualties is covered.

Some companies would provide compensation according to the amount of premiums bought, the nature of the casualty and the law of the land.

It is really of great importance and highly recommendable to have the policy that is best for you and that would render the approximate and complete compensation to cover any loss.

Inception Date

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This is the date from which an auto insurance policy took effect. The date that an insurance coverage starts on an auto insurance policy. Normally, the validity period of the insurance coverage starts counting from the date of inception.

When the validity period ends, this shows that the coverage which starts from the date of inception has cease or is no longer in force.

There will be need for the renewal of policy to keep the coverage active. The insurance company determines and enforce the date form which the coverage begins.

Hit and Run

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In auto terms, this is a form of accident that is caused by a person who refuses to provide any needed information or fail to render assistance at the time of the accident.

In a situation like this, if the accident victim had earlier bought an auto coverage, he/she may have the alternative of using his/her insurance claim for damages done.

Hazard

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In speaking auto insurance terms, this is something that is capable of causing an accident or increases its chances of occurrence. These things can come in any form and at any time. They range from climatic conditions such as wind, storm, etc.

Other forms of these may also come as a result of the poor condition of the vehicle, such as the brake, side mirror and the front class.

If you notice any fault in these areas of your car, why not buy the right auto insurance coverage for it, or if you have already bought an insurance policy you can use the premiums to do some repair work for it to save you more money.

Guarantee Funds

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These are the amount of money used to recover policyholders from any possible liabilities resulting from the failure or closure of insurance companies.

All insurance companies that are licenced must consider the possible bankruptcy of their insured liabilities, hence be required to recover their insured or policyholders from future debt should the insurance company fail to operate.

Grace Period

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This refers to the time period after the due date of insurance payment during which a policyholder is allowed to pay for an insurance coverage. This is a practise by some insurance companies that grant their insured the ability to pay for coverage right after the due date of their policy.

Some insurers would rather not allow policyholders to pay for insurance coverage after the expiry date. It could be a good thing to opt to pay for coverage online especially if you are insured under an insurance company that does not allow insurance payment after due date, giving room for lack of delayed insurance paymennt.

Free Look Period

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This refers to the first period of an auto insurance policy which is usually a minimum of thirty days from the time the policy took effect. This may be different from state to state.

Financial Responsibility Law

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This is the law that expect or demand that vehicle owners are capable of paying off any losses relating to auto insurance. This can be done as a proof that he is financially able for an auto insurance covearge.

Fair Market Value

2012-06-26T20:43:00.000+01:00

This has to do with the change of price of property between a seller and a buyer who are both willing to sell and buy. The seller and buyer should be proficient about all details relating to any property involved. Both parties have the freedom to sell or buy at any convenient time.

Electronic Funds Transfer

2012-05-16T16:03:00.000+01:00

This is a method of paying for insurance premiums resulting in automatic deduction from your bank account. Some insurance companies, though, do not call for such payment method.

This type of payment is done when there is enough funds in your bank (usually checking) account for the corresponding premiums.

Effective Date

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This is the date that coverage commences on an insurance policy. The insurance coverage is usually in force from the date of commencement.

The validity of premiums is counted from the date the insurance coverage begins. The time of an insurance policy to take effect may depend on the insurance company and/or local law.

Economic Loss

2012-05-09T16:34:00.000+01:00

This is the total financial loss resulting from the demise or any casualty of a wage earner. This can be compensated by the insurance company especially when it involves the loss of property.

It is a very tragic event that can happen to anyone but when these are insured it may help in reducing the cost of damage or loss.

Extended Coverage

2012-04-19T14:12:00.000+01:00

This is the inclusion of endorsement of an insurance policy to provide coverage for risks in addition to those covered under the basic policy provisions.

The inclusion of this endorsement is fully dependent on the policyholder. It is entirely left for the assured to decide if he/she ever wants an additional coverage for properties.

It is only recommended for persons whose circumstances put them in the track of an additional coverage and who can really afford the cost of it.

Exclusions

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These are items that are not eligible for insurance coverage under the terms of an insurance policy. The insurer does not provide coverage for such items because they are not applicable to the insurance terms.

For example, an auto insurance company may have to provide collision coverage for damage caused by collision but do not provide insurance for damage caused by tear and wear etc

Ensure you understand all the terms of your insurance policy before getting coverage from them. This will put you in a better position to avoid unnecessary acts that do not call for coverage.

Endorsement

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This is a document stating the agreed status of a policyholder attached to an insurance policy for the subtraction or addition of an insurance coverage.

It could be essential for any auto insurance policy to be effective. When you have this written agreement attached, your agreed status takes precedence in the policy.

Make sure your insurance policy have the document attached for completeness of your policy and for it to properly be in force.

Driver Education Credit

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This is the reduction or discount on auto insurance premiums for which young drivers become eligible upon completion of a driver education course.

This discount is meant for those drivers who would generally not meet up with the regular or usual amount of premiums as billed per month.

In most states, the age limit for those eligible for discount ranges from about 45-50 years.

Generally, the premiums paid by these drivers are lower than that paid by other drivers who are not eligible for this credit.

The driver education program has really made a big impart on the lives of average drivers and the auto insurance industry; creating more insured individuals on reduced premiums and improving the standard and level of auto insurance companies.

Driver Education

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This is a professional educational course, often state accredited, for eligibility of drivers for discount on auto insurance premiums. The duration of education largely varies as may be determined by state law.

The students of such education are entitled for driver education credit which gives them the qualification of a premium discount.

The amount paid as premium by drivers of such course are quite different from those who have not undergone such educational course.

Depreciation

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This is the drop or reduction in the value of an item or property over time. There are a number of factors affecting the reduction of the actual value of a property. These include collision, as can be seen from that experienced by car drivers.

Another factor affecting the drop in value of an item is accident. Not unusual for car drivers, but it can greatly reduce the market value of a car or any other property.

Some auto insurance companies do not offer coverage for value reduction of a car, but can provide insurance coverage if such is caused by factors that are insurable, e.g. collision, accident etc

If you intend to have your car insured when its value is reduced by an insurable factor such as collision, then you are to have your car insured under the collision coverage of your insurer.

Deposit Premium

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As the name implies, it is the payment for an insurance policy by an individual considered as a prospective policyholder after applying for an insurance policy.

Insurance contract are usually followed when the individual's application is finally reviewed and accepted. For most insurance companies, the least premium that can be paid as at the time of application for the insurance policy is per month.

The validity of premiums deposited can be determined by the number of months allocated for such premiums and the duration an assured is covered as at the time the policy is in force.

Discount

2012-04-13T19:39:00.000+01:00

It is the abatement of premiums of the insured for meeting up certain requirements or criteria. The policyholder may be entitled for some benefits and coverage which may not be generally issued to others covered under the same policy.

The reduction rate of premiums is mostly different from one insurer to the other, and depends on the type of policy of the assured.

Most insurers would grant the benefits of high loss reduction rate and increased policy limits or claim for their assured.

Some auto insurance companies may have specific period when they offer to reduce the premiums of their policyholders when these qualify or meet up to the requirement.