Designated Insured – The first person in whose name the insurance policy is issued. Electronic Funds Transfer (EFT) – EFT is an electronic payment method that allows you to pay your rewards with automatic deductions from your credit/debit card or checking account. Claimant – A person who makes an insurance claim. Expiration Date – The date your insurance coverage expires. An insurer may change the language or coverage of a policy at the time of contract renewal. Notices and tabs are written provisions that supplement, delete or modify the provisions of the original insurance contract. In most states, the insurer is required to send you a copy of the changes to your policy. It is important that you read the endorsements or endorsements to understand how your policy has changed and whether the policy is still sufficient to meet your needs. An insurance contract consists of four basic parts: Renewal Date – The expiry date of your insurance policy and the date your renewed policy begins. Limitations of Liability – The maximum amount your liability policy pays. Your policy must pay at least $25,000 for each person injured, up to a total of $50,000 per accident and $25,000 for property damage per accident. This basic coverage is called “25/50/25” coverage. Limits – The maximum amount an insurance company pays for damage or injury that applies to coverage.
Most states have laws that set the minimum limit that must be purchased for each insurance coverage required. Towing and Rental Coverage – Pays the towing fee if your car can`t be driven. Also pays the cost of a rental car during the repair of the insured vehicle. Claim – Any claim or request for payment in accordance with the terms of the insurance policy. It is important to understand that property and casualty policies may have specific exclusions and conditions for each type of coverage, such as. B, collision coverage, medical payment coverage, liability coverage, etc. You should make sure to read the language of the specific coverage that applies to your loss. Garage location – The place where you primarily park your vehicle when not in use. In general, this is your principal residence. It is also the principle of insurable interest that allows married couples to take out insurance on each other`s life, according to the principle that one can suffer financially if the spouse dies.
There is also an insurable interest in certain commercial agreements, such as those between a creditor and a debtor, between business partners or between employers and employees. Termination – Termination of an insurance policy by the company or insured before the renewal date. If you provide inaccurate information with the intention of deception, your insurance contract will become invalid. Insurance Score – Used in the underwriting process in some states. A person`s insurance rating is often based in part on a person`s credit history. Loss – The amount an insurance company pays for a claim. These definitions do not apply in all states or to all products. Other terms, conditions and exclusions may apply to your individual policy. Please read your official policy for more details on coverage and restrictions. All insurance contracts are based on the concept of uberrima fides or the doctrine of the greatest good faith. This doctrine emphasizes the existence of mutual faith between the insured and the insurer.
Simply put, when you apply for insurance, it becomes your duty to honestly disclose your relevant facts and information to the insurer. Similarly, the insurer cannot hide information about the insurance coverage sold. Deductible – The amount the insured must pay in the event of a loss before a payment is due by the company. Reinstatement – The process by which an insurance company reinstates a policy after it expires due to non-payment of renewal premiums. Discount – A reduction in your premium if you or your car meets certain conditions. For example, auto insurance discounts are granted to prove previous coverage, renew your policy with GAINSCO, choose an automatic payment option, etc. As already mentioned, insurance works according to the principle of mutual trust. It is your responsibility to disclose all relevant facts to your insurer. Normally, there is a breach of the principle of the highest good faith if, intentionally or accidentally, you do not disclose these important facts.
There are two types of secrecy: There are additional factors in your insurance contract that create situations where the total value of an insured asset is not remunerated. When applying for insurance, you will find a wide range of insurance products available on the market. If you have an insurance advisor, he or she can look around and make sure you get adequate insurance coverage for your money. Nevertheless, a little understanding of insurance contracts can go a long way in keeping your advisor`s recommendations on track. Reinsurance occurs when your insurer “sells” part of your coverage to another insurance company. Let`s say you`re a famous rock star and you want your voice to be assured for $50 million. Your offer will be accepted by Insurance Company A. However, insurance company A is unable to hold all the risks, so they pass on some of that risk — say $40 million — to insurance company B. If you lose your singing voice, you will receive $50 million from insurer A ($10 million + $40 million), with insurer B paying the reinsurance amount ($40 million) to insurer A. This practice is called reinsurance. In general, reinsurance is practised to a much greater extent by non-life insurers than by life insurers. A) Insurance: These are the written statements you have made on your application form that represent the proposed risk to the insurance company.
For example, on a life insurance application form there is information about your age, details about family history, occupation, etc. representations that should be true in every way. An insurance breach only exists if you provide false information (e.g. B in important statements. Your age). However, the contract may or may not be invalid, depending on the type of misrepresentation that occurs agent – A person who sells insurance policies. GAINSCO policies are sold exclusively through a network of independent partner agents who cater to the individual needs of their communities. Quote – An assessment of the cost of repairing your damaged property. Endorsement – A written agreement attached to a policy that extends or limits benefits otherwise payable under the policy. Also known as Reiter.
Claims Adjuster – A person responsible for writing the repair quote for your vehicle. He or she will also answer your questions about vehicle repairs, rental vehicles and loss statements. Rental Reimbursement – Optional coverage that helps pay the costs of the rental vehicle if your insured vehicle is deactivated as a result of an insured accident or loss. Liability Insurance – Covers injuries sustained by the other party and damage to the other vehicle as a result of an accident caused by you. It`s also profitable if the accident was caused by someone covered by your policy, including a driver who is driving your car with your permission. Co-insurance refers to the division of insurance by two or more insurance companies in an agreed relationship. For the insurance of a large shopping mall, for example, the risk is very high. Therefore, the insurance company may choose to include two or more insurers to share the risk.
Co-insurance may also exist between you and your insurance company. This provision is very popular in health insurance, where you and the insurance company decide to divide the covered costs in a 20:80 ratio. Therefore, your insurer pays 80% of the damage covered during the claim, while you pay the remaining 20%. To obtain a copy of your insurance policy, please contact your insurance agent or company. Conditions are provisions that are inserted into the policy and that qualify or limit the insurer`s promise of payment or performance. If the insurance conditions are not met, the insurer may reject the claim. .