Understanding Auto Insurance Jargon: Part 1
Plymouth Rock Assurance makes it easy for you to be an informed consumer. We’ve taken some commonly used words and phrases you might find on your auto policy – or hear from your insurance agent – and translated them into plain English. Our jargon decoder can help you better understand your policy and improve your fluency in “insurance-ese.”
| Additional interest or secured lender | The terms “additional interest” and “secured lender” refer to the company or person to whom you owe money for the purchase or lease of your vehicle. It may also refer to a co-owner of the vehicle whether or not it is financed. The leasing company, bank, finance company or co-owner is entitled to part or all of the insurance compensation if your car is damaged. |
| Coverage limits | The coverage limits represent the maximum amount your insurer will pay for a claim under a specific type of coverage, after you pay the deductible on your policy. Some types of coverage, like bodily injury liability, display two limits, such as “$50,000/$100,000.” In this case, the first amount is the maximum the insurance company may pay for any one individual person injured in an accident that is covered under your insurance policy. The second amount is the maximum the insurer may pay for all persons injured in the same covered accident. |
| Dec page (or declarations page) | Also called a “coverage selections page.” This usually appears at the front of your policy documents. The dec page lists the coverage options you have chosen for each vehicle on the policy, shows any endorsements that apply to the policy, and shows the premium for each type of coverage selected as well as the total premium for your policy. |
| Deductible | A deductible is the amount of money you will be responsible for paying, before the insurance company starts to pay, for damage from an accident that is covered under your insurance policy. For example, if you have selected Collision coverage for your car with a $500 deductible, and your car suffers $1,200 in damage from a collision, you will be responsible for paying the first $500 and the insurance company will be responsible for paying the balance of $700 toward repair of the damage. |
