Automobile Insurance: The Policy

Automobile Insurance: The Policy

A common mistake when shopping for automobile A common mistake when shopping for automobile insurance is looking only at the price between two insurance is looking only at the price between two policiespolicies

Policies differ from policy to policy and company to Policies differ from policy to policy and company to companycompany

5 parts to an insurance policy:5 parts to an insurance policy: DeclarationsDeclarations

CoveragesCoverages

ExclusionsExclusions

ConditionsConditions

DefinitionsDefinitions

Declarations

Lists important personal policy information Lists important personal policy information and is unique to each individual insuredand is unique to each individual insured

Contains personal information:Contains personal information:

namename

addressaddress

vehicle make and modelvehicle make and model

vehicle identification numbervehicle identification number

types of coveragestypes of coverages

policy limitspolicy limits

deductible amountsdeductible amounts

Coverage Parts/Insuring Agreement

Outlines the coverage options and coverage Outlines the coverage options and coverage limits purchasedlimits purchased

In short, what your insurance company In short, what your insurance company promises to provide in return for your promises to provide in return for your payment, based on the coverages and payment, based on the coverages and coverage limits selectedcoverage limits selected

Exclusions

Details what is Details what is notnot covered by the policy covered by the policy

Examples:Examples:

Intentional damage to your own vehicleIntentional damage to your own vehicle

Damages caused while vehicle is used as a delivery Damages caused while vehicle is used as a delivery vehiclevehicle

Conditions

Define the insured’s and the insurer’s duties Define the insured’s and the insurer’s duties that, under the terms of the policy, must be that, under the terms of the policy, must be fulfilledfulfilled

Includes:Includes:

premium payment obligationspremium payment obligations

steps to filing a claimsteps to filing a claim

procedures for resolving a claimprocedures for resolving a claim

Definitions

Explains specific terms used throughout the Explains specific terms used throughout the policypolicy

Examples:Examples:

““You” or “Your” refers to the “Named Insured”You” or “Your” refers to the “Named Insured”

““We” or “Us” or “Our” refers to the insurance We” or “Us” or “Our” refers to the insurance companycompany

““Family Member” refers to a resident of your Family Member” refers to a resident of your

householdhousehold

Automobile Insurance: Accidents

Chances are even if you are never in an Chances are even if you are never in an accident you will witness oneaccident you will witness one

What should you do if you are involved What should you do if you are involved in an accident?in an accident?

Steps to take after an accident

•Help anyone who is injuredHelp anyone who is injured

•You have an ethical and legal responsibilityYou have an ethical and legal responsibility

•Notify the policeNotify the police

•Prevent further accidentsPrevent further accidents

•Protect the accident sceneProtect the accident scene

•Record informationRecord information

•Exchange information with the parties involvedExchange information with the parties involved

•Take note of time, location, weather, and road Take note of time, location, weather, and road conditionsconditions

It is important that the accident is reported It is important that the accident is reported promptly to the insurance agent or companypromptly to the insurance agent or company

The policy will guide the insured on the The policy will guide the insured on the correct steps to take to report the claimcorrect steps to take to report the claim

The company will guide the insured through The company will guide the insured through the processthe process

Filing a Claim

When you are liable for an accidentWhen you are liable for an accident

•The insurance company covers the loss up to the The insurance company covers the loss up to the policy limitspolicy limits

•Your insurer represents you if you are suedYour insurer represents you if you are sued

•Your insurer has the right to settle any legal action Your insurer has the right to settle any legal action without your permissionwithout your permission

•Your premium may riseYour premium may rise

•Insurer has the right to cancel your policyInsurer has the right to cancel your policy

•If the losses exceed the policy provisions, the If the losses exceed the policy provisions, the insured is responsible to cover the excessinsured is responsible to cover the excess

Filing a Claim