When you look for car insurance and request quotes from the various insurance companies do you have any idea about the questions that you need to ask, what certain terms in the quotes imply and what are the stipulations involved? Either you request for quotes from the internet or you will have insurance advisors from different providers coming to see you. Well here are some of the words that are used in the quotations or by the insurance advisor.

One of the most important is the word ‘liability’ which is nothing but the insurance coverage that is supposed to shield you, your automobile, and other possessions if you happen to be at fault for an accident where more than two automobiles are involved. This liability coverage will not only look after hospital and repair bills of the other party, but can also protect you in the case of a suit that has been filed against your name. Now the liability limits can vary from state to state. If you take liability insurance for $15,000, then it means that the insurance provider will pay to the limit of that amount to the other person.

‘Uninsured motorist’ is the term used for the coverage that will safeguard you in case some other person causes an accident in which you are involved and they have no insurance coverage whatsoever.

‘Medical payment’ is what will pay the bills you incur in the hospital up to the amount mentioned in your policy. Generally the medical insurance is slated at $5000, but it can be increased or decreased at will. ‘Comprehensive’ coverage will include burglary, fire, breaking of glass, damage, etc. and this is available with many deductibles and a variety of options while ‘collision’ coverage will help to pay off repair bills when the vehicle is involved in an accident.

‘Full coverage insurance’ combines all the above mentioned coverage including comprehensive and collision coverage. There is also something called Gap insurance that can be considered as an add-on to an already existing insurance coverage. As you may know any car the moment it leaves the showroom depreciates in value and if unfortunately your car is involved in an accident and the car is a ‘total loss’, the insurance company will only offer to pay a certain amount of money. Now, if you have gap insurance this will help pay your balance amount that is due. So give gap insurance a thought will you?

Professional indemnity |