Additional Equipment - Coverage provided for parts and equipment that are not installed by the vehicle manufacturer. Coverage is subject to a maximum limit listed on the endorsement and defined in the policy.
Adjuster - A person who evaluates the damage or loss caused by an accident or other covered loss using the terms and conditions described in a policy of insurance to determine the amount to be paid.
Agent – An individual who is licensed and authorized to sell and service insurance for an insurance company.
Automobile Insurance - Insurance that protects against losses involving automobiles. Automobile insurance policies contain a number of coverages that can be purchased depending upon the needs and requirements of the policyholder. In Maryland, liability for bodily injury and property damage, medical payments or PIP, uninsured motorist, comprehensive, and collision are some of the common coverages offered in an auto insurance policy.
Binder - A limited and usually short-term agreement that provides temporary insurance coverage until the policy can be issued or delivered.
Broker - A licensed individual or organization who, on your behalf, sells and services insurance policies.
Commission - Renumeration or compensation paid to an agent using a portion of the policy premium in return for the agent's work.
Comprehensive Coverage – Automobile coverage that pays for damage to your car caused by circumstances other than collision, such as fire, theft, vandalism, windstorm, and flood.
Claim – Loss that has occurred may be eligible for coverage under the terms and conditions of a policy.
Collision – Automobile coverage that pays for damage to your vehicle caused by physical contact with another vehicle or an object such as a tree.
Declarations - Typicially the first page of an insurance policy that contains the name of the insurance company, your name and address, effective and expiration dates, the policy number, premium charged, the amount and types of coverage, vehicle(s) insured, deductibles, and the vehicle identification numbers.
Deductible – A monetary amount that the policyholder is responsible to pay in a loss.
Endorsement- A written agreement that changes the terms of an insurance policy. It may or may not by change coverage.
Exclusion – Typicially a contractual provision that restricts or denies or insurance coverage for certain persons, perils, locations or property.
Insured – An individual(s) to whom the policy contract or by State statute is extended coverage under an insurance policy.
Insurer - The insurance company who issues the insurance policy and provides coverage.
Liability Insurance – Insurance coverage extended to a policyholder resulting from injuries to others or damage to their property.
Limits - The maximum amount of benefits provided under a policy of insurance.
Medical Payments Coverage - Covers the medical costs (up to the specified limit) resulting from an auto accident for you, your family, or others in your car.
Non-Renewal – Notice provided by an insurance company for the termination of an insurance policy. Coverage is not offered to be extended for an additional term.
(PIP) Personal Injury Protection - Covers the medical costs, loss wages, related economic damages (up to the specified limit) resulting from an auto accident for you, your family, or others in your car. This coverage pays regardless of fault unless waived.
Policy - A contract that lays out the duties of the insurance company and the insured.
Premium - The money paid to an insurance company for a policy.
Premium Finance Company - A lending institution that finances automobile insurance premium for a fee.
Producer – A term to refer to agents and brokers.
Quote - An estimate of the cost of insurance based on the information supplied to the agent, broker, or insurance company.
Rental Reimbursement Coverage – Pays for the expense to rent an auto if you have a covered loss. Coverage is usually based on a daily amount of expense and subject to a maximum limit.
Replacement Cost - The costs to replace lost or damaged property with new property of like kind or quality
Salvage – Loss damaged property that is signed over to an insurer in a loss settlement.
Second Party - The insurance carrier under an insurance contract.
Subrogation – An action taken to recover claims damages paid out to a policyholder from the legally liable party. For example when your insurance company pursues a legally liable third party to recover money they have paid out on your behalf.
Surcharge - An additional charge applied to a policy premium by an insurance company.
Third Party - An individual other than the policyowner or insurance company who has incurred a loss and may be entitled to collect compensation under the policy based on the negligent acts or omissions of the policyowner.
Total Loss - Damage or destruction to property that cannot be rebuilt or repaired to its pre-loss condition; or where it would be cost prohibitive to repair or rebuild in comparison to the value of the property before the loss.
Towing Coverage – Coverage that pays a specified amount for towing and related labor costs as defined under the policy.
Uninsured Motorist Coverage - Coverage for a policyholder involved in a loss with a driver who does not have liability insurance or who does not have sufficient liability covereage to pay for damages. Uninsured Motorist Coverage is comprised of : uninsured motorist bodily injury (UMBI) and uninsured motorist property damage (UMPD). UMBI can cover injuries to an insured when there is a collision with an uninsured driver. UMPD coverage can cover property damage to your vehicle or property in a loss involving uninsured driver.
Disclaimer:
- These terms are for informational purposes only.
- The actual terms stated in an insurance policy prevail over the information provided here.
- The information contained here does not create rights or obligations for any party.
- The information is not intended to be a substitute for the actual policy.