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Interesting Questions, Facts and Information
- There are a total of 45 general entries. We are selecting 30 for display.
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 Interesting Questions, Facts, and Information
 Insurance
Changed. An endorsement is something that changes the policy in some way.
| The declarations page of your auto policy states that your liability coverages are 100 300 100. What coverage does the last figure represent? | Insurance Terminology
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Property Damage. The 100 300 is that amount that would be paid towards personal injuries of others if you were found liable in an automobile accident. The last 100 is what would be covered towards the property of others due to your liability. Comprehensive and Collision cover your own vehicle.
| Your standard unendorsed plain-vanilla homeowner's insurance policy carries a $1,000 deductible. It does not ocver earthquakes. An earthquake causes $6,300 in damage to your home. How much would your insurance company pay for the cost of repairs? | Insurance Terminology
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Nothing. Earthquakes are not part of standard homeowner's policies. It is a separate policy that is purchased or an endorsed coverage that can be added to the policy.
| The medical payments portion of your automobile policy (Coverage B) provides protection for who? | Insurance Terminology
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You and your passengers. Bodily injuries of others is covered in your liability. Medical payments covers you, your family, and your passengers.
| A bunch of items are stolen from your vehicle. They are valued at {$4,800.} Under what type of policy listed would this loss be covered? | Insurance Terminology
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Homeowner's. Personal property is not covered by an automobile policy. Items in your vehicle are covered by a homeowner's or renter's policy under the Personal Property coverage.
| You were in an accident that is not your fault. The other party either has no insurance or refuses to pay. Your insurance company pays for your damages and then has the right to go after the liable party for compensation. This is referred to as what? | Insurance Terminology
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| Your gun collection is stolen from the gun cabinet in your home. The stolen items have a combined total value of {$4,500.} How much will your insurance company pay for this loss if you have a {$1,000} deductible? | Insurance Terminology
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{$2,000}. Firearms have a {$2,000} coverage limit as pertaining to theft.
Dwelling Fire. A dwelling fire policy covers the home itself, limited contents coverage, and liability insurance. As you are renting the home to others, a homeowners policy would not be appropriate. The renter should take out a renters policy to cover their personal property against a loss.
| There is a section in any insurance policy which clarifies the meaning of certain terms used in the policy. What is this section referred to as? | Insurance Terminology
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Physical Damage and Liability. The same as the basic coverages in an auto policy. The most significant difference between the two is the high dollar exposure to loss with an aircraft.
| In a commercial auto policy, a motor carrier can be covered under the Truckers coverage form, when? | Insurance Terminology
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If they transport goods for others by hire.
| This is a written form that verifies a policy has been written. It provides a summary of the coverage provided under the policy. What is it called? | Insurance Terminology
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Certificate of Insurance.
| In most states, the signature of a licensed agent must appear on the policy to validate the contract. What is this concept called? | Insurance Terminology
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| This Ocean Marine insurance provides coverage for physical damage to a ship, what is it called? | Insurance Terminology
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| Assuming you have coverage that protects your car in the event that it gets damaged, this scenario unfolds...
You are driving home from work late one night and a deer jumps out in front of your car. You attempt to avoid it but hit the deer. The animal is ok but your car is not. You call your insurance company on your cell phone and your car gets towed away. What coverage will your claim be handled under? | Your USA Auto Insurance Policy: Things To Know
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Comprehensive. If you have physical damage coverage for your car, there are two types of coverages: collision and comprehensive (also called OTC or Other Than Collision). It is a bit of a misnomer because collision with an animal or bird is one of the criteria for a comprehensive claim. Fire, theft, and missiles (falling debris) are other examples of where your car would be handled under comprehensive coverage. Anything else would be collision (as long as another vehicle or person collided with your car).
| You are driving down the road at about 55 MPH. The speed limit is 45. It is a one-lane road in each direction. As you come to an intersection, your light is green so you do not hit the brakes. There is another driver heading in the opposite direction. Suddenly, without warning, he takes a left in front of you. You attempt to swerve but hit him. The police come out and ticket the other driver for "failure to yield right of way". Will his insurance company definitely owe for your damages, assuming that he is covered? | Your USA Auto Insurance Policy: Things To Know
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No. First of all, every state in America has different laws about "shared" negligence. In this scenario, you may have been able to avoid the accident had you not been speeding. The police were not witnesses to the accident either, so their report and ticket is a guide for the insurance adjusters but is not the determining factor. In states where the laws are of "Contributory Negligence", a driver that is even 1% negligent is barred from recovery from another carrier. In "Comparative Negligence" states, the adjusters of the two companies decide on a percentage of faults for each party. For instance, you may be found to be 20% at fault due to excess speed and can recoup 80% of your damages. There are even more complicated laws in other states, but I think that is enough for now.
| There are times when insurance companies cannot agree on a determination of who is at fault in an accident or what percentage of negligence lies with either party. In these instances, some insurance companies each state their case using the evidence gathered in their investigation and write up contention sheets. They then sumbit these sheets to a forum which makes a binding decision on liability. What is this called?
| Your USA Auto Insurance Policy: Things To Know
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Arbitration. Many companies, especially the notable ones such as Allstate and State Farm are members of arbitration. The main company is in Atlanta, Georgia and is named "Arbitration Forums." Whatever they decide is what the final verdict will be.
| Most people have a certain amount of money that they have to pay before the insurance company will kick in any money to repair their car. Usual amounts range from $250 to $500 to even $1000. What is this called? | Your USA Auto Insurance Policy: Things To Know
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Deductible. You choose your deductible when you buy your insurance policy. The higher the deductible, the lower your insurance premiums usually are. However, if your car gets sideswiped or you hit a tree, you should be aware of how much out of pocket money you will have to pay a body shop or dealership before picking up your repaired vehicle.
| An appraiser from your insurance company comes out to look at your car after you rear-ended someone at a red light. The whole front end is smashed in. You have had this car for a while and it has sentimental value to you, but according to the appraiser is just a 1989 Honda Civic. The amount of money it would take to fix the car is more than the car is worth. He tells you that your car is a total loss. Is there a scenario where you can keep your car? | Your USA Auto Insurance Policy: Things To Know
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Yes. This is on a case-by-case basis but depending on the insurance company, the state you reside in, and whether or not you own the car outright (no liens), there are ways to keep your car. Once a car is determined to be a total loss, it is now considered to be a piece of salvage. One option may include owner retaining your salvage, where the insurance company figures out how much money it would have made by selling the car for a salvage bid and subtracting that from your settlement. Another is a "Contract Repair". This is when the cost of fixing your car is at least 80% of what the car is worth, but is still "fixable". If you can find a body shop or dealership to fix it at a certain price, the insurance company may pay a one-time fee and get you to sign a release. The problem with that is that if more damage is found, you are out of luck.
| Speaking of finding more damage, let's say the appraiser writes up an estimate on your 1999 Saturn SL2 for $1300. After they cut you a check, your body shop tears down the car and finds suspension damage. The shop then calls the appraiser to come back out. What is the process called when a second estimate is written in an attempt to get an agreed price between the insurance company and the body shop?
| Your USA Auto Insurance Policy: Things To Know
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Supplement. While the other answers may seem to be viable, this process is called a supplement. It happens more often than not because an appraiser can only write what he can see with his naked eye the first time around. A good rule of thumb is to leave room for a possible supplement when appraising a car in the event that the extra damage will end up totaling the vehicle.
| Injuries! Injuries! Injuries! So far, we have discussed an injured auto, but what about injured people? Liability insurance is what you have to protect yourself from a financial hit if you strike someone else and are found to be negligent. What is the term for the coverage that, up to its limit, will pay for the injuries sustained to people as a result of your negligence? | Your USA Auto Insurance Policy: Things To Know
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Bodily Injury (BI). Liability insurance breaks down into two coverages: property damage (PD) and bodily injury (BI). The Toyota Camry that you hit will be paid for by your property damage coverage and the driver of the vehicle that went to the hospital and then went to physical therapy for a few months will be taken care of by your bodily injury coverage. BI is not required in all states. However, it is a big risk to take, if you live in a state that does not require BI and you injure someone. Many people get an attorney and they will come directly after you and your assets. This is the branch of claims that I currently work in. I talk to attorneys all day long. Are you jealous? :)
| Someone rear ends your nice new 2002 Volkswagen Jetta and after it gets appraised, it is determined it will take 3 days for a body shop to repair it. You need a rental car. What are you owed by the adverse insurance company?
| Your USA Auto Insurance Policy: Things To Know
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Loss of Use. No insurance companies have to set you up with a rental agency. This is a wide misconception. Most companies do this however and have contracts with companies such as Enterprise. However, all that is owed is the lost time that it will take while your car is being repaired. This is calculated by the amount of labor hours on the estimate by the number of hours that the shop is allotted to working on the car per day. In other words, if there were 35 labor hours (body and paint) and the shop works on each car for 5 hours a day, this would be 7 days loss of use or LOU. The company should pay you for a comparable vehicle for those days (and shops don't work on weekends, so that is 2 extra days), making it 9 days. If they pay you $30 a day for 9 days, for instance, you get a separate check for $270, besides the check to fix your car. LOU is also under your property damage coverage.
| You are not paying attention and run a red light and smash into 4 cars in the middle of a busy intersection. There were 3 passengers in one car, 2 in another, and 5 in another. Luckily, one of the four cars only had a driver. You are found to be responsible for 4 property damage losses and 14 bodily injury losses (4 drivers and 10 passengers). The limits you chose for your policy is $25,000/$50,000 for bodily injury (per person/total amount of people) and $50,000 for property damage. Everyone gets attorneys and all four cars are totaled. No one is happy about it, but they all go through their own insurance policies to get their cars fixed. When their companies are finished with the payments, they will look to your company for reimbursement. What is this process called?
| Your USA Auto Insurance Policy: Things To Know
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Subrogation. Having coverage for your own vehicle is important even if you are not at fault, like the cars in the intersection in this example. They may have to pay their deductibles, but their cars can get fixed and then the insurance companies retain the right to be reimbursed. As for the injuries, you better find yourself a good attorney that can work out a payment program. Once the insurance company has exhausted its limit in liability (PD and BI), they are no longer obligated to defend you. This situation is called an "excess situation" and many times the companies, defense attorneys, and plaintiff attorneys will attempt to come up with a "pro-rata" plan that indemnifies their clients or policy holders the best that they can. This is why it is important to have higher liability limits or to combine limits into an "Umbrella policy".
| As if I haven't confused you or bored you enough, what happens if a car with no insurance hits you? There are some states where it is still not mandatory to carry insurance. In any event, even in states where you are supposed to have insurance, people drive around without it. What is the name of the coverage that you can purchase to protect you against this hazard?
| Your USA Auto Insurance Policy: Things To Know
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Uninsured Motorist. Uninsured Motorist (or UM) is mandatory in some states and not in others. In the event that you are hit by someone who is uninsured or UNDERinsured like in the last example, your insurance company would treat you like a person that you hit. There is UMPD and UMBI (uninsured motorist for property damage and uninsured motorist for bodily injury). Usually, they have higher limits and smaller deductibles. Again, it is case by case whether or not your state even has such coverages available (UMPD is only in certain states). "Full coverage" is a misnomer because no one is EVER fully covered. There are exclusions in your policy, deductibles, limits on coverages, as well as many other situations where you will have to come up with out of pocket money. Do not let anyone fool you into thinking that you have "Full Coverage".
Health Maintenance Organization. When HMOs first started, many people were attracted to them because they covered routine check-ups and tests while the traditional insurance plans only covered "sick visits". However as HMOs developed further they have become less popular because they limit which doctors a patient may see and what treatments are covered. HMO management has been known to overrule doctors about whether a given treatment is "medically necessary".
| Patients and/or their employers pay a regular amount each month to the insurance company, regardless of whether the patient is receiving any medical treatment. What is this amount called? | Health Insurance Information
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Premium. Regular premiums are paid to create a pool of available funds which can then be used to pay the medical bills of the contributors. At least that's the concept behind health insurance. However, some of this money goes as profits to the insurance companies' management and shareholders, rather than being used for medical or administrative purposes. The CEO of Blue Cross/Blue Shield of Maryland, Bill Jews, received over $2.77 million in salary and bonuses in 2002 (This was reported in the Baltimore Sun on July 8 2003). That would cover a lot of doctor's visits!
| Many policies require the patient to pay an initial amount of their own bills before the insurance will reimburse anything. What is this amount called? | Health Insurance Information
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Deductible. Policies with higher deductibles usually are less expensive since the insurance doesn't kick in right away. This is true of other types of insurance (such as auto or homeowners) as well as health insurance.
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