Drivers Ed insurance terms

Assigned Risk Plan Insurance

• ARP (Assigned Risk Plan) – minimum liability coverage; otherwise called (SR22 insurance) by insurance companies

Blue Book

• Information on vehicle pricing, including automobile trade-in values, as  well as car ratings and reviews.

Bodily Injury Coverage

• Pays claim against the owner if someone is killed or injured and the owner is at fault.

Collision Coverage

• Pays for the damage to YOUR car if you are at fault.

Comprehensive Coverage

• Pays for damage from the following (when you are not driving at the time of damage)

Deductible

• A set amount of money that must be paid by the policy holder in case of damage to his/her car.

Depreciation

• A decrease or loss in value, as because of age, wear, or market conditions.

Financial Responsibility Law

• Law requiring the operator of an automobile to show financial ability to pay for automobile-related losses 

Leasing

• Is the loaning of the use of a vehicle or a fixed or indefinite period of time.

Liability Coverage

• This coverage pays for the damage to the other driver's property and/or their medical bills when you are at fault in a collision.

No-Fault Insurance Policy

• Both parties pay for their own damages (their own collision coverage).  Those injured in an accident receive direct payment from the company with which they themselves are insured.

Policy

• A contract between the person insured and the insurance company.

Premium

• The amount of money that an insurance policy costs for a period of time. (monthly, quarterly, semi-annual, or annual

Property-Damage Insurance Coverage

• Pays claim against owner if property of others is damaged and owner is at fault

Real Cash Value

• The worth of a car or other property at the time of the crash.

Claim

• A demand by an insured person from an insurance company or another person for an amount of money to cover losses from an accident.  The more claims you make the higher your insurance rates go up.

Coverage

• The type of insurance a person purchases

Rating Territory

• Where you live

uninsured Motorist Coverage

• This covers your medical bills only if someone who hits you has no insurance

Underinsured Motorist Coverage

• This type of coverage is useful when someone hits you with not ENOUGH insurance to cover the large amount of expenses to your car in the accident.

Grace period

• A thirty day period past the premium due date when an insured is still covered.

Liability limits

• The maximum amount of money your insurance company will pay for any given accident.

Negligence

• When a person does not act in a fair or wise manner. 

Medical payments coverage

• This coverage pays for your passengers and you if they are injured in a crash and it is your fault.

Emergency Road Service

• This coverage pays for emergency road service calls

Rent-a-Car Coverage (Rental Coverage)

• Pays for a Rental Car if your vehicle is in the repair shop being fixed because of a collision

25

• Maximum the company will pay for any one person injured in a crash

50

• Maximum the company will pay for a group injured in a crash 

20

• Maximum the company will pay for any property damaged you destroy.