Don’t you sometimes feel that your auto insurance policy is riddled with terminology and verbiage that you don’t understand? At Insurance Doctor it is important to us that you understand your insurance policy in full detail. Here are a few common terms used and their definitions to help unlock the mystery of automobile insurance.

At-fault: being the one responsible for an accident.

Broker: an insurance salesperson who works with agents and companies to find the best insurance for consumers available at the time

Negligence: injury or damage to a third party caused by failure to exercise a generally acceptable level of caution

Policy period: the actual time period that an insurance contract or policy is valid providing coverage

Premium: the set amount of money you pay to have insurance

Proof of loss: valid documents that you give to the insurer as evidence to support your request for payment of losses

Surcharge: is an added charge above the cost of your premium due to a previous accident or violation

Underwriter: an individual in an insurance company who writes your policy after determining what insurance risks will be accepted and on what terms

Have you ever really looked at your car insurance? There are multiple components to your automobile insurance policy. It’s important to understand the current coverage that you have and what each section means in case you are involved in an accident.

Here are the basic types of coverage included in the average vehicle policy:

Property Damage Liability – This covers property damages to another person’s car that you or a family member have damaged.

Bodily Injury Liability – This provides coverage for bodily injury claims from the people you might injure in an accident

Uninsured and Underinsured Motorist Coverage – This coverage protects you when a negligent driver doesn’t have insurance or doesn’t have enough insurance to cover damages. This usually includes bodily injury losses, and sometimes property damage losses.

Physical Damage Coverage – This will cover damages to your car if you are involved in a collision or if your car is damaged in a storm.

These are very brief descriptions of coverage that might be included in your automobile policy. Call Insurance Doctor if you have questions about your current policy.

Don’t panic! A fender bender is an unfortunate occurrence, but it usually does not mean that you will lose your insurance coverage. The reality is that filing a automobile insurance claim will probably raise your current premium.

Your auto insurance premium will probably go up after an accident – especially if you were the driver at fault. Studies show that people who have previously had accidents are more likely to have another accident again. Therefore, companies tend to charge you more for insurance coverage because of the likelihood of another claim in the future.

Of course what you really want to know is how much your premium will increase. This is a more difficult question to answer because different insurance companies use different formulas to calculate rate increases. But don’t worry, in almost all cases, your policy will not be cancelled because of one fender bender.

Call Insurance Doctor if you have questions about your automobile insurance policy.