Here is a comprehensive alphabetical list of terms to simplify your understanding of the car insurance industry.
Act of God- Any occurrence that is not due to the individual. These acts may or may not be insured by the car insurance company.
Additional Premium- An extra premium that a car insurance policy holder has to pay over and above the normal premium. Additional premiums can vary from company to company depending on the vehicle make and type.
Assistance- The facility provided by the car insurance provider to the insured car. An example of this assistance can be arranging for a car towing service incase of severe damages to the vehicle.
Authorised Insurance- All those car insurance companies that are certified under the Insurance Companies Act 1982 to operate one or more classes of insurance businesses in United Kingdom.
Approved Repairer- Car repairers as suggested to a policy holder by the insurance company provider. These approved repairers usually function as a part of the panel in a car insurance company.
Agent- A agent is generally a representative who acts on behalf of a car insurance company. Car insurance agents are not always salaried personnel, they can also be independent operators.
Annual Premium- A premium payable as and when decided by the insurance company provider. Annual premiums can be monthly or quarterly.
Benefit- The amount of money paid by the car insurance provider to the policy holder upon reporting a car insurance claim.
Betterment- When the insurance policy holder pays to the insurer the cost of the claim, because his/her vehicle will be restored to a better condition after repairs than before the damage occurred. A betterment cost varies with each insurer.
Broker- A car insurance company that is registered with the IBRC (Insurance Brokers Registration Council). The car insurance company thus becomes a broker and acts on behalf of its clients.
Certificate- A documented proof of car insurance according to RTA 1988 c.52
Claim- A payment request made by the insured when his/her car experiences some form of severe damage or loss.
Co-Insurance- When several car insurance companies contribute in providing cover for one specific risk.
Commercial Business- An insurance policy that is issued by any auto company.
Commission- Remuneration paid to an agent for selling car insurance policies.
Comprehensive Cover/Insurance- A car insurance policy that provides cover for all possible risks to a vehicle.
Condition- One of the requirements of a car insurance policy that a motorist should ensure care of his/her vehicle.
DOC cover- DOC stands for Driving Other Cars. A type of insurance policy whereby a person can drive another person’s car with their knowledge provided the person driving has third party car insurance.
Endorsement- Changes made in a car insurance policy. Endorsement holds legal value in the court of law.
Excess- A certain amount of money that the insured has to pay towards the value of a claim. It can be voluntary or compulsory depending on the requirements of an insurance policy.
Ex-gratia payment- Any disbursement made by a car insurance company which is not under the terms and conditions of the car insurance policy.
Exposure- The level to which an insurer is exposed to losses arising from a particular risk.
General Insurance- The insurance of risks whereby the car insurance policy proffers insurance for a reduced period of time. General Insurance is also known as non-life insurance.
Green Card- A car insurance document issued to UK motorists for driving in foreign countries. This is a proof of the bare minimum car insurance cover as necessitated by the law of the country visited.
Indemnity- A car insurance contract whereby the car policy holder is able to go back to his/her previous financial status after a car loss/damage as they were previously before it.
Insurance Premium Tax- Also known as IPT. It is a UK government tax imposed on certain insurance premiums. There are two rates for IPT; one is a standard rate of 5% and the other is a higher rate of 17.5%.
Insured- A car owner who is covered by a car insurance policy wherby his/her car related interests are protected by the policy.
Intermediary- An auto insurance company that advises and negotiates policies for their clients.
Partner- Refers to you or another person sharing your accommodation and living together like a spouse.
Loss Adjuster- A certified professional who investigates large and complicated vehicle loss claims.
Market Value- The value of a car in terms of age, condition, make and model as established by the standardized trade car guides.Policy- A booklet that contains your certificate of car insurance along with all binding terms and conditions is known as a policy.
Mechanical Breakdown Insurance- This type of insurance provides coverage to all the motorized components of your car.
Period of Cover- The duration for which you and your car are insured as per the car insurance policy is identified as a period of cover.
Personal effects- Denotes your personal items that are in your car during theft, fire breakouts, theft or attempted vandalism. Some car insurance firms may not cover for money, stamps and documents that may be left in your car when such incidents occur.
Qualifying period- This is a time period during which you keep making the premium payments for your car but are ineligible to make any kind of claim.
Registration date- The date when your car insurance policy commences is known as registration date.
Review date- This is the date when your car insurance registration has to be reviewed. This happens once a year.
Solicitor- The legal expert that will represent you in the court of law in case you are asked to appear in the court due to charges associated with car accidents or damages.
Territorial Limits- Denotes Great Britain, Northern Ireland, the Republic of Ireland, The Isle of Man, and the Channel Islands.
Third party cover- The minimum level of car insurance required by all UK motorists is third party cover. In addition to this coverage is cover for any fire breakouts or burglary attempts to your car.
It provides coverage to third parties i.e. pedestrians or other car drivers, in case you injure them or cause damage to their car.
Third party fire and theft- Refers to coverage given to third parties in case your car damages their car or causes any bodily injury to them.
You/your- Refers to the car insurance policy owner. It can also include a partner or a number of dependents.
Young driver- If your age is between 18-25 years, then your car insurer will classify you as a young driver.
Your car- Denotes the car as specified in your car insurance policy.
Uninsured losses- The costs that you cannot claim from your car insurance policy is indicated as uninsured losses.
We/our/us- Refers to your vehicle insurance firm or agent.
Windscreen cover- Cover provided for unintentional dents, scratches or breakage to the windscreen or windows of your car.
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