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CAR INSURANCE TERMS EXPLAINED
The following are insurance terms you can expect to find in a standard policy document. You should be aware of these terms and their meanings
as they are used throughout the car insurance industry. These insurance terms can be explained to you by a broker, but it's always best to be prepared.
Additional Insured
Insurance terms for a person , other than the named insured or covered person, who
is protected under the named insured's auto policy.
Anti-Theft Device
Devices designed either to reduce the chance an auto will be
vandalized or stolen, or assist in its recovery.
Examples include car alarms, immobilisers and tracking devices.
Car Insurance
A form of insurance that protects against losses involving cars.
Different type of cover includes comprehensive
cover, limited cover and Third party only liability.
Basic Limits of Liability
Most car insurance policies limits the maximum amount that the
insurance company will pay for liabilities
per incident (accident).
Commission
That portion of the premium paid to the insurance broker as
compensation for their services.
Comprehensive Coverage
This car insurance terms covers damage to a vehicle caused by any physical damage to the
vehicle
Examples include fire, theft, vandalism, and falling objects.
Mechanical damage ( like engine failure ) is not included.
Continuous Coverage or Continuous Liability Insurance
Continuous coverage refers to the length of time you have
maintained insurance on your vehicle.
Covered Person
This refers to the individuals (named insured, spouse, resident
relatives, etc.) insured under a policy contract.
Earned Premium
The portion of a premium that has been "used up" during
a policy term. With a one-year policy, half of the total premium
has been earned after six months.
Effective Date/Inception Date
The date that coverage begins on an insurance policy.
Excess
The amount an insured person must pay before the insurance
company pays the remainder of each covered loss, up to the
policy limits.
Expiry Date
The date your coverage ends. There is usually a time of day
associated with this date, for example, an expiration date of
31/12/2005 at 12:01am. This means your coverage ends one minute
after midnight on the date listed.
Gap Insurance (also known as top-up insurance)
If your vehicle is financedand you experience a total loss,
there may be a difference (gap)
between the market value of your vehicle(what the insurance
company will pay) and
what you still owe on it. This optional coverage pays the
difference.
Multi-car discount
A discount offered by some insurance companies for those with
more than one vehicle insured on the same policy. In some cases,
if you drive a company car insured by your company, your own
insurance company may give you the multi-car discount.
Named driver
Any person, designated by name as the insured person(s) in a
policy.
Others may be protected by policy definition even though their
names aren't on the policy, such as other drivers operating
(with consent) the named insured's covered car.
Per Occurrence Limit
This refers to the cap amount an insurance company will pay for
all claims arising from a single incident. In an automobile
accident, it comprises bodily injuries sustained by all parties.
When Bodily Injury coverage is purchased in split limits, the
second limit is the "per occurrence" limit: e.g. $100,000(per
person)/$300,000(per occurrence)
Per Person Limit (same as limit of indemnity)
This refers to the cap amount an insurance company will pay for
any one person's injuries arising from a single incident.
Personal car insurance Policy
The most common car insurance policy sold today. The type of
cover provided by various insurance companie
is basically the same.
Physical Damage
Damage to your covered vehicle from perils including (but not
limited to) collision or upset with another vehicle object,
fire, vandalism and theft.
Policy
The written documents of a contract for insurance between the
insurance company and the insured. Such documents include forms,
endorsements, riders, terms and conditions and attachments.
Policy Period
The period of time in which a policy is in effect. (For example,
six months or one year).
Policyholder
One who maintains ownership in an insurance policy.
This may refer to the policy owner or those covered under the
policy.
Preferred Risk
Any risk considered to be better than the standard risk on which
the premium rate was calculated.
Premium
The price of insurance an insured person pays for a specified
risk for a specified period of time.
Private Passenger vehicle (car)
A four-wheeled motor vehicle that is subject to motor vehicle
registration and used for private personal use.
Renewal
The process of keeping an active policy in force through the
issuance of a renewal policy.
Term
The length of time for which a policy or bond is in force.
Towing and Labor Costs
This endorsement, which is added to the physical damage
coverage, provides reimbursement up to a specified limit to tow
your vehicle or pay for on-site labor costs.
Usage
This refers to the primary function or purpose in which you
intend to operate your vehicle. For example, if you primarily
drive your car to and from work, the usage is considered private
use. "if you're self-employed and you primarily drive to see
customers, the usage is considered "business;" if you're
retired, your usage is also considered private.
VIN Vehicle Identification Number
A Vehicle Identification Number is a 17-digit alpha-numeric code
that provides valuable information concerning the vehicle's
serial number, make, model, options, and year in official
records (like an identity number for your car).
Waiver of excess
This option cancell your excess (first amount payable ) when you
claim from your car insurance.
This cover is usually gained by paying an additional monthly
premium.
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VW, Volkswagen, Nissan,
Toyota, Ford, BMW, Mercedes-Benz, Mazda, Mini, Hyundai,
Kia, Chevrolet, Volvo, Renault, Peugeot, Citroën,
Citroen, Audi, Jetta, Golf, Passat, Isuzu, Hi-lux,
Double cab, Fiesta, Focus, A3, A4, Corolla , RunX, 316i,
318i, 320i,325i, 328i, Cooper, Cooper S, C180, C200,
C220, Kompressor......
It does not matter what kind of
car you drive..... we will get a
you a good car insurance premium.
Car insurance in South Africa
need not be expensive......
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