National Insurance Company - Glossary of Insurance Terms
Have you read or heard insurance terms, but you aren't really sure what they mean? Well, that is the very reason that we created this Insurance Glossary of Terms. It is very important that you fully understand what all terms mean before agreeing to the terms.
A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z
A
Accidental Death -
When an individual who is covered by accidental death coverage in an auto insurance policy dies in a car accident, this area of automobile insurance may issue some form of compensation to the heir or beneficiary of the deceased.
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Accident -
An accident is an occurrence, usually with a negative connotation, that cannot be predicted, avoided or anticipated. In auto insurance terminology, the word "collision" is often substituted for "accident."
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Actual Cash Value - This is a term used in many automobile insurance policies. When your car is damaged beyond repair, an auto insurance company will not reimburse you for the total amount you paid for the car. Instead, most auto insurance companies will pay you the "actual cash value" which is determined based on the original cost of the car and adjusted to account for depreciation.
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Adjuster -
The person who evaluates and processes automobile insurance claims is known as an adjuster.
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Agent or Insurance Broker -
An insurance agent is an individual who is authorized to sell insurance on behalf of an insurance company. An insurance broker is an individual who evaluates insurance policies and purchases insurance policies on behalf of an individual.
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Altered Vehicle -
An altered vehicle is a vehicle that has received modifications and adjustments that are designed to improve the vehicle's performance, value, or external appearance.
Benefit -
When you file an auto insurance claim and you or your beneficiary are granted a monetary payment based on the terms of your insurance, this monetary payment is called a "benefit."
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Binder -
A "binder" is an agreement that is either written down in the form of a contract or agreed upon orally that states that an individual has agreed to purchase insurance from a provider at agreed upon rates.
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Bodily Injury -
This is a portion of an automobile insurance policy that covers medical expenses for persons injured in an automobile accident in which you are at fault. Bodily injury insurance may also cover court fees.
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Business Auto -
Business auto is an automobile classification that denotes that your automobile is used primarily for business-related purposes. These purposes may include sales and delivery trips, business-related errands, or automobile service for business associates but may not include commuting from home to work.
C
Cancellation of Insurance -
Cancellation involves terminating the insurance agreement before the previously agreed-upon date of policy cessation.
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Claim -
The claim is the dollar amount that the individual with an insurance policy requests from his or her insurance provider as reimbursement for damages or losses.
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Coinsurance -
Coinsurance is insurance that is jointly held by multiple individuals.
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Collision Coverage -
Collision coverage is a form of automobile insurance. This type of auto insurance will either pay for damages incurred in a collision accident or provide monetary reimbursement for a totaled car.
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Comprehensive Coverage -
Comprehensive coverage is a form of automobile insurance that covers more than automobile accidents. Natural disasters or automobile theft are all covered under comprehensive automobile insurance coverage. The maximum cash value that you can receive is equal to the value of your automobile adjusted to incorporate depreciation.
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Concurrent Insurance -
Concurrent insurance is insurance that is under two or more contracts which cover the same period of time and the same subjects.
D
Declarations -
In your insurance policy, the page of Declarations is a summary of all of the facts that are important to your specific insurance coverage. Examples of information included in the Declarations section are: policyholder information, vehicle description, insurance premiums, limitations, and deductibles.
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Deductible -
A deductible is an amount that is chosen by the policyholder when selecting auto insurance coverage. When a policyholder files a claim, the auto insurance company will provide only the amount in excess of the deductible. In other words, the deductible is an amount you agree to pay out of pocket.
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Depreciation -
Depreciation is a term that describes any valuable item's normal decline in value because of age, deterioration, or damage.
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Discount -
A discount is a reduction in the amount of an insurance policy's premium costs based on the policyholder meeting specific criteria such as a good driving record, good student record, or completion of safe driving courses.
E
Effective Date -
The date on which your insurance policy begins is known as the Effective Date.
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Endorsements -
Endorsements are changes made to your insurance policy during the policy's active period. These changes, also referred to as riders, may include deductible rates, types of coverage, or number of drivers and vehicles.
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Excess Family Coverage -
This is a type of automobile insurance coverage that may provide medical coverage to you or your relatives regardless of fault in the event of a collision.
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Exclusions -
Situations and events that are not covered by your auto insurance policy are known as Exclusions.
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Extended Replacement Cost -
This type of insurance provides monetary compensation for the full cost of personal items without taking depreciation into account.
F
Family Compensation -
This type of coverage provides monetary reimbursement for medical costs related to injuries received by you or a family member in an automobile accident that is not the policyholder's fault.
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Felony -
A level of crime with a more severe punishment than a misdemeanor crime.
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Fraud -
A crime that involves dishonesty with the intension of stealing or cheating. Fraud is grounds for the dismissal of an insurance policy.
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Full Coverage Auto Insurance -
Full coverage is actually a misnomer because no auto insurance company offers total coverage. This term is generally used to denote a policy that covers more than liability.
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Funeral Benefits -
This type of coverage is related to Personal Injury Protection or Bodily Liability coverage. If an individual dies in a car accident, the insurance policy of the covered car may provide reimbursement for funeral expenses regardless of fault.
Garaging Location -
The garaging location is the place where a car is typically stored or "garaged." Students often include their school's address as their garaging location if their school is farther than one hundred miles from their home.
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Good Student Discount -
Students who have a school record of a B-average, or a 3.0 average, or higher may receive a good student discount which lowers automobile insurance premiums.
Hazard -
A hazard is a condition, often dangerous, that increases the likelihood of an accident or loss occurring.
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Homeowners Insurance -
A type of insurance policy that often covers theft of automobiles or items in automobiles.
Identity Theft Expenses -
A type of insurance coverage that provides monetary reimbursement for expenses or damages accrued because of identity theft.
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Indemnification -
Indemnification is the process by which an individual is restored to his or her previous financial position by an insurance policy after a loss has occurred.
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Insurance Claim Report -
An insurance claim report is a detailed report that provides specific information regarding an accident or issue that has caused a claim to be filed. These reports are generally filed by independent claim reporting agencies that collect information and distribute it to insurance companies. An example of a common agency issuing these reports is C.L.U.E., the Comprehensive Loss Underwriting Exchange.
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Insured -
The individual who is covered by an insurance policy is referred to as the Insured.
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Insurer -
The company that provides the coverage under an insurance policy is referred to as the Insurer.
J
Judgment -
The judgment is the final decision in an insurance claim or a discrepancy between individuals involved in an accident. The judgment determines fault and damages.
Kentucky Discount Categories -
There are three categories on which anti-theft discounts are based in Kentucky
Liability -
The term liability is used to denote responsibility in the case of an accident. If you are driving recklessly or disobeying traffic laws and an accident occurs, you may be held liable.
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Liability Coverage - Auto
This type of insurance coverage provides payment to the individuals whose property or person is damaged by an at-fault policyholder.
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Liability Coverage - Homeowner
This type of insurance coverage will pay for medical compensation to or damages to property of third parties which a policyholder may unintentionally or irresponsibly cause.
This type of coverage is generally divided into two parts: medical payments to others and personal liability coverage.
Medical payments to others will provide compensation for medical and/or funeral expenses that are incurred by third party individuals. These payments will be made within three years of an accident and are only made to third-party members, not policyholders.
Personal liability coverage provides monetary reimbursement for damage to personal property that is caused by the policyholder.
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Lienholder -
A lienholder is an individual or a party who has a claim upon property or resources until another individual or party satisfies a debt.
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Lien -
A lien is a claim made by a creditor against an individuals' property until a debt is satisfied. Liens are often determined by a court of law.
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Life Insurance -
Life insurance is a form of insurance which provides monetary compensation to a beneficiary when a family member dies.
Market Value -
The market value of an item or a service is the selling price listed on the open market.
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Medical Payments Coverage -
Medical payments coverage is a type of automobile insurance coverage which will cover medical expenses or funeral expenses incurred by either the driver or a passenger should a vehicle accident result in injury or death. Fault is not a factor in medical payments coverage.
This type of insurance policy may also cover the policyholders and their immediate family members if they are injured as passengers in another vehicle or as pedestrians.
When policyholders purchase this type of insurance coverage, they choose a capped limit which determines the insurance premium.
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Misdemeanor -
A misdemeanor is a criminal offense that is generally considered to be less serious than a felony and comes with lighter or less dire consequences.
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Misrepresentation -
Misrepresentation involves statements which are either completely false or intentionally misleading.
National Credit File -
The National Credit File is information that provides creditors or insurance providers with details about an individual's financial history and is often used to determine insurance costs and premiums.
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No-Fault Insurance -
No-fault insurance is a type of automobile insurance coverage that is generally awarded by the insurance company without any requirement for determination of fault in an accident or collision.
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No-Fault States -
Some states are called no-fault states. This means that auto insurance companies are required to pay coverage amounts regardless of the fault in an automobile accident. Some of these states limit the right to sue for damages as well.
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Non-Passive Alarm -
A non-passive alarm may qualify you for discounts on your auto insurance premium. This type of car alarm must be activated every time the vehicle is left unattended. If a thief lifts your door handle when the alarm is activated, the ignition system of your car is disabled.
Occupancy -
Occupancy determines how an insured property is used.
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Occurrence -
In the case of property damage, the term occurrence is used to denote continued exposure to an event which may cause injury but is not intended to cause energy. Homes in Tornado Alley have a high tornado occurrence.
Personal Injury Protection -
PIP is Personal Injury Protection, a type of mandatory auto insurance policy that is only featured in certain states.
Personally injury protection expands the types of expenses that are covered under an auto insurance policy. Lost wages and long-term injuries are usually covered by PIP.
The details of PIP are determined by state government, and specific items and injuries covered by PIP vary greatly in different states.
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Personal Liability -
This is a type of liability insurance which provides coverage for damages or injuries that are a result of the personal actions performed by a person who is covered by Personal Liability insurance.
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Policy -
A policy is a contract or certificate, in writing, that details the terms of insurance coverage.
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Policy Date -
The policy date is the term given to the date when your insurance policy expires. After this date passes, your insurance policy is no longer valid and your policy must either be renewed or a completely new policy must be purchased.
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Primary Driver -
The person who most frequently drives an automobile is the primary driver.
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Primary Use -
Depending on how you most typically use your automobile, your insurance policy may classify your vehicle's primary use as pleasure, work commute, or business related.
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Primary Policyholder -
The Primary Policyholder is the first person who is insured on a policy.
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Property Damage Liability Coverage -
If you are judged as being responsible for damaging someone's personal property with your automobile or causing another automobile to damage personal property, you will need property damage liability coverage to cover the costs.
Property damage liability coverage can be used to reimburse an individual whose property has been damaged by your vehicle. Property can include automobiles, homes, lawns, or any other material item.
Property damage liability coverage may also be used to cover the cost of a lawsuit, but the total amount may not exceed previously agreed upon limits.
Qualification Period
The qualification perdiod is the time during which the insured is found to be totally disabled before becoming eligible for residual disability benefits.
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Qualified Plan -
A qualified plan is a plan in which the IRS approves as meeting the necessary requirements of Section (401a) of the 1954 IRS Code. These types of plans can receive tax advantages.
Real Property -
Real property is a term given to property that is considered real estate such as houses or land.
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Rental Car Reimbursement -
If you need a rental car because of damage to your car or an unforeseen breakdown, rental car reimbursement is a type of auto insurance that can cover the cost of renting a car.
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Replacement Cost -
Replacement cost is the total cost of replacing damaged or lost property or goods and does not take into account the reduced cost associated with depreciation.
Safe Driver -
Depending on your state, discounts that are given because of an accident-free or responsible driving record are called Safe Driver discounts.
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Salvage -
Salvage is a term that is given to damaged property that is restored or put to further use.
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Secondary Driver -
A secondary driver, or occasional driver, is a driver on an insurance policy that is not the most frequent driver of the automobile.
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Supplemental Family Member Liability Coverage -
In Maryland, Supplemental Family Member Liability Coverage is an additional insurance policy that can be purchased.
SFML coverage protects the driver who is at fault in an accident that is shown to have caused the death of a family member.
Supplemental Family Member Liability coverage amounts are equal to the Bodily Injury limits purchased by the policyholder.
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Supplemental Spousal Liability -
In New York, Supplemental Spousal Liability is an additional auto insurance coverage type that can be purchased at the policyholder's discretion.
SSL is a type of coverage that will protect an at-fault driver whose auto accident causes the death of a spouse. The covered amount can be specified by the policyholder when the policy is purchased.
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SR-22 -
The SR-22 is the name of an official state document that shows evidence of financial responsibility. This document is filed with the Department of Motor Vehicles in a policyholder's state and may be required if the policyholder is convicted of frequent traffic violations.
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Steering Restraint -
A steering restraint is a durable, protective shield or lock that is placed over the steeling column of a car, making it incredibly difficult for potential thieves to steal an automobile. If your car has a steering column, you may qualify for auto insurance discounts.
Term of Policy -
The Term of Policy, also called the Policy Term, is the duration in which an insurance policy is valid.
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Tort -
A tort is a piece of legal jargon that describes an event in which an individual has damaged another's personal property or caused serious injury. In some states, individuals who limit their rights to sue for damages without a monetary value can then apply for reduced premiums on auto insurance coverage.
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Towing Coverage -
Towing coverage is a type of optional automobile insurance coverage that will cover the cost of hiring a towing service to move a stranded vehicle.
Uninsured Motorist Bodily Injury Coverage -
Uninsured motorist bodily injury coverage is a type of auto insurance coverage offered in certain states. In states where Uninsured Motorist Bodily Injury coverage is offered, this type of coverage is often mandatory. This coverage provides medical reimbursement for injuries sustained by yourself or your passengers in the event that you experience a collision caused by an uninsured driver. The amount of coverage is determined by the policyholder when the coverage is purchased.
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Uninsured Motorist Property Damage Coverage -
Uninsured motorist property damage coverage is a type of auto insurance coverage offered in certain states. In states where Uninsured Motorist Bodily Injury coverage is offered, this type of coverage is rarely mandatory but often encouraged. This coverage provides monetary reimbursement for property that is destroyed or damaged in the event that you experience a collision caused by an uninsured driver. The amount of coverage is determined by the policyholder when the coverage is purchased. Often, a deductible must be paid each time an uninsured motorist property damage claim is made.
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Uninsured/Underinsured Motorist Bodily Injury Coverage -
Uninsured/Underinsured motorist bodily injury coverage is a type of auto insurance coverage offered in certain states. In states where Uninsured Motorist Bodily Injury coverage is offered, this type of coverage is often mandatory. This policy is different from uninsured motorist coverage because it bundles together uninsured and underinsured motorists. This coverage provides medical reimbursement for injuries sustained by yourself or your passengers in the event that you experience a collision caused by an uninsured driver or a driver that does not have enough insurance to cover your expenses. The amount of coverage is determined by the policyholder when the coverage is purchased.
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Unsatisfied Judgments -
Unsatisfied judgments are failures of an individual to pay debts or other amounts decided by a court of law to cover damages or provided goods or services.
VIN -
VIN is short for Vehicle Identification Number and denotes a 17-digit number that is located on every car is unique to each individual automobile. This number includes a serial number that identifies the car as well as information denoting the make, model and year.
The VIN is listed on your vehicle's registration card and is also engraved somewhere on your automobile. Usually, the VIN is located on the windshield or the inside of the driver's door.
The VIN of your vehicle must be provided when you purchase an automobile insurance policy.
Waiver of Collision Deductible -
The Waiver of Collision Deductible is a type of coverage that will release you from having to pay a deductible in the event that you sustain damages or injuries due to a collision with an uninsured or underinsured motorist who is at fault.
No "X" insurance terms at this time.
No "Y" insurance terms at this time.
No "Z" insurance terms at this time.