Insurance Glossary
An accident is an unwanted, unexpected happening that occurs unintentionally and usually results in harm, injury, damage, or loss. The accident may be at-fault, not-at-fault, reported or unreported.
The Accredited Customer Service Representative (ACSR) program is a nationally recognized program created by the Independent Insurance Agents and Brokers of America, Inc and AICPCU/IIA. It provides participants with a strong insurance foundation and equips them with the skills needed to succeed in today’s agency environment.
Actual Cash Value (ACV) refers to the value of a damaged vehicle, or a vehicle trade in. In the case of a damaged vehicle, the ACV is used to determine if the vehicle is totaled or eligible for repair when you file an insurance claim after an accident.
An additional insured is a person or organization that enjoys the benefits of being insured under an insurance policy, in addition to whoever originally purchased the insurance policy. The term generally applies within liability insurance and property insurance, but is an element of other policies as well. Most often it applies where the original named insured needs to provide insurance coverage to additional parties so that they enjoy protection from a new risk that arises out of the original named insured’s conduct or operations.
A device, either active or passive, that attempts to prevent vehicle theft. Active anti-theft devices can track and recover a vehicle and automatically contact a response center to begin the vehicle recovery process. Passive anti-theft devices attempt to prevent theft by using sophisticated electronic car alarms, simple steering wheel locks, etc.
Any Auto Liability Insurance covers all vehicles listed on a business owner’s commercial vehicle policy whether they are owned, non-owned, or hired.
Companies that typically carry Any Auto protection are those that rely heavily on vehicles such as contractors, freight haulers, and others.
Any Auto may have exclusions and restrictions and may not be available in all or situations. It does not cover physical damage.
Associate in Insurance Services is a professional designation awarded by the Insurance Institute of America (IIA) upon successful completion of four national exams, one specifically designed for this program and the three examinations in the IIA Program in General Insurance. The program leading to this designation consists of one course in total quality management for insurance personnel with an exam made available on demand and the three general insurance courses, together with those exams.
BMC91 is the Auto Liability Filing issued to the Federal Motor Carrier Safety Administration by your insurance company as proof of your liability insurance.
Bobtail insurance protects a tractor when it is operated without a trailer. This is not to be confused with Non-Trucking Liability coverage, which only covers a vehicle when it’s driven for personal, nonbusiness use.
Bobtail insurance is sometimes also called “deadhead” coverage.
Bodily Injury Liability is one part of liability insurance. Bodily Injury Liability coverage pays for injuries and death to people involved in an accident that you are responsible for. Bodily Injury Liability coverage also pays for the costs of your legal defense if you are sued.
Certified Insurance Counselor (CIC) is an insurance agent professional certification designation. The CIC certification program was started by the National Alliance for Insurance Education & Research in Austin, Texas in 1969.
The CIC program is for agency owners, producers, agents, brokers, and agency and company personnel. To be eligible to attend CIC institutes and obtain the CIC designation, an individual must:
- be a licensed agent, broker, adjuster, or solicitor, or
- have at least two years of full-time experience in the insurance industry or as a risk management practitioner, or
- have served as a full-time insurance faculty member at an accredited college or university
The CISR program is a continuing education credit-approved, nationally recognized designation program that takes a practical, hands-on approach to learning.
This designation is recognized nationwide as an important credential – one that benefits individuals, their agencies, and their customers. Through this program, developed by the National Alliance for Insurance Education, students who are committed to continuing education and career growth can obtain the highest level of professional insurance education.
Combined single limit liability provides one total limit of liability for Bodily Injury Liability coverage and Property Damage Liability coverage per occurrence or accident.. There is no individual liability limit per person, per occurrence, or for property damage limit.
A CDL is a special license needed by operators of tractors, vehicles over 26,000 GVW, or vehicles carrying more than seven passengers.
A commercial vehicle is any vehicle (tractor, bus, car, pickup) used for business purposes.
If your insured commercial (business use) vehicle is damaged due to an event other than a collision, comprehensive coverage will pay for the damage. Damage caused by fire, theft, windstorm, flood and vandalism are often included.
Collision coverage pays for the damage to your vehicle if you overturn your commercial vehicle, or it collides with another object.
Being continuously insured will help you get The Best Quote In Texas. Continuous Insurance means your company has had insurance coverage in effect at all times without a lapse in coverage for any reason.
A corporation is a legal entity registered with the State in which it is formed. A corporation is owned by stockholders – the people who buy shares of stock issued by the corporation. . A corporation protects the stockholders so they are not held personally responsible for liabilities of the corporation (debts, lawsuits, etc.). The corporation itself is held responsible for obeying laws, paying taxes, signing contracts, etc.
Coverage is the word used to describe protection for an insured as provided by an insurance policy. A particular coverage may refer to a specific component of insurance that provides protection under a given set of circumstances.
People who travel from home, working a few weeks at a time at various locations harvesting seasonal crops, are custom harvesters. They sometimes also are called agricultural workers or migrant workers.
Also known as an auto insurance coverage summary, this page is provided by your insurance company and lists the following:
- Types of coverage you have selected
- Limit for each coverage
- Cost for each coverage
- Specified vehicles covered by the policy
- Types of coverage for each vehicle covered by the policy
- Other information applicable to the policy
In an insurance policy, the deductible is the amount of expenses that must be paid out of pocket before an insurer will pay any expenses resulting from a specific loss or accident. In general usage, the term deductible may be used to describe one of several types of clauses that are used by insurance companies as a threshold for policy payments. Deductibles always are selected when you purchase an insurance policy.
A diplomatic driver’s license is issued to members of foreign consular posts and their family members in the United States. Diplomatic driver’s licenses can only be issued by the Department of State through its Diplomatic Motor Vehicle Office.
A discount is a percentage reduction applied to a premium for fulfilling specific requirements or actions as an insured.
Sometimes called a business alias, a DBA is a name by which a company is known to the public but which is not its legal name. DBA registration is typically handled through your county clerk’s office, and is generally required by your bank to open a business account.
EFT is a payment method in which funds are automatically deducted from a customer’s checking account to pay bills on a regularly scheduled basis. Customers must select the EFT payment method and authorize payments in advance to use this system to pay their bills.
Employer’s Non-Owned coverage provides liability insurance for a vehicle owned by your employee if it must be used to conduct your business. This coverage is for vehicles that are not regularly used for the business.
The Federal Highway Administration provides stewardship over the construction, maintenance and preservation of the Nation’s highways, bridges and tunnels. FHWA also conducts research and provides technical assistance to state and local agencies in an effort to improve safety, mobility, and livability, and to encourage innovation.
Established within the Dept. of Transportation (DOT) on January 1, 2000, the FMCSA’s primary mission is to prevent commercial motor vehicle-related fatalities and injuries.
A filing is a certificate of insurance issued by an insurer that provides proof of specific insurance coverage. A BMC91, for example, is a type of filing.
Federal filings are submitted to the Federal Highway Safety Administration and are often required for interstate transportation of goods, people or hazardous materials.
State filings are submitted to a specific state’s Department of Transportation or other governing body. They often are required for intrastate transportation of goods, people or hazardous materials.
The damage or loss must be caused by one of the following: fire, lightning, explosion, theft, windstorms, hail, earthquakes, flood, rising waters, vandalism, a collision with an animal, or while being transported by a third party.
For-hire truckers are truck owners and operators who transport goods for a fee.
Auto Liability filing sent to a specific state by the insurance company as proof of insurance.
Garage Keeper’s Legal Liability coverage was designed for towing businesses. It protects your customers’ vehicles in case of fire, explosion, theft, vandalism or collision when the vehicle is at your garage or covered location for servicing, parking or storing.
A garaging location is the place you primarily park your vehicle when you’re not using it. Generally, this is your primary business address.
Covers the loss exposures arising from a business’ premises and operations, its products or its work
GVW is the total weight capacity of a fully loaded vehicle. It can be calculated by adding the weight of the vehicle to the maximum weight of a load that could be carried in the vehicle. GVW can be obtained by checking the manufacturer’s general information for the vehicle.
The U.S. Department of Transportation (DOT) defines hazardous materials as articles or
substances which are capable of posing a risk to health, safety, property, or the
environment; are listed or classified in the regulations; and are transported in
commerce.
Hired Auto coverage provides Liability coverage for a non-owned, unlisted vehicle that you have leased, hired, rented or borrowed.
Provides coverage for loss or damage to an auto, which the insured leases, rents, borrows or hires on a short-term basis.
This coverage extends your Liability and Physical Damage coverages to other non-owned private passenger-type autos that you, or a resident relative, might drive.
This coverage is for vehicles that are not available for your regular use, and that are not owned by you, your spouse or any resident of your household. This coverage is available only to individual named insureds, and not to corporations or partnerships.
If you cross the border of one state into another state, that is interstate travel.
If you stay within the borders of one state, that is intrastate travel.
A lease is a contract or arrangement in which the use of equipment, such as a vehicle, is granted for a specified time at a specified price.
Liability coverage provides protection against your legal liability for Bodily Injury and/or Property Damage caused by the negligence of your employees or yourself in the operation or use of your insured motor vehicle. This coverage also provides you with legal defense costs in the event you are sued as a result of an accident.
A Limited Liability Company combines the personal liability protections of a corporation and the pass-through tax benefits of a partnership or sole proprietorship. Owners of LLCs typically are called members and share equally in the management responsibilities of the company. LLCs may also choose to appoint certain owners or outside personnel to manage business operations.
An insurance coverage limit is selected by you at the time you purchase a policy. It describes the maximum an insurance company will pay for damages or injuries that apply to a specific coverage. Most states have laws that specify the minimum limit that must be purchased for each required insurance coverage.
Liability coverage limits can be described as a combined single limit (CSL) or as a split limit.
Auto Liability endorsement evidencing that a motor carrier has the minimum amounts of financial responsibility required by the federal government.
MedPay is an optional insurance coverage that pays for reasonable and necessary medical and funeral expenses for covered persons. These expenses must be incurred as a result of an auto accident.
A minimum limit is the least amount of insurance coverage required by state law. Sometimes also called statutory limits, minimum limit requirements or basic limits.
Coverage for loss or damage to the property that a motor carrier is transporting.
The named insured is the name of the business or person who owns the insurance policy.
Non-Owned Vehicle insurance extends the coverage provided under the Bodily Injury Liability coverage and Property Damage Liability coverage of your policy to any vehicles not owned by you or your business that are used by any of your employees for business.
If you are on permanent lease to a motor carrier that supplies your primary Liability coverage, Non-Trucking Liability coverage protects you when you are using your scheduled vehicle for personal conveyance.
Sometimes referred to as contingent liability coverage, Non-Trucking Liability coverage does not apply when the insured auto is being used to transport any goods or merchandise, nor while goods or merchandise are being loaded or unloaded.
Primary liability coverage must be retained from the motor carrier to cover you while you are operating your vehicle in a trucking capacity on behalf of the motor carrier.
A person who is not the primary or principal driver of an insured vehicle is an occasional driver.
On-Hook Towing Liability coverage provides physical damage coverage for a customer’s auto or watercraft while you are towing it. The protection includes damage caused by fire, theft, explosion, vandalism or a collision.
A truck driver who works as an independent carrier of goods instead of as an employee of one trucking company is an owner operator. The term can also be hyphenated and written as “owner-operator.”
Partnerships are frequently composed of groups of professionals, such as attorneys, accountants and lawyers, but may also be retail and service businesses.
Equipment that is used in the course of doing business and is bolted or welded to an insured vehicle or trailer is permanently attached equipment. Examples of PAE include:
Air compressors
Carpet cleaning equipment
Computers
Cranes
Generators
GPS units (mounted in vehicle)
Ladder racks
Lift gates
Lift kits
Logging equipment
Pressure washers
Shelving
Snow plows
Tool boxes
Equipment that is attached to the vehicle and makes the vehicle what it is, such as buckets, cement mixers, dump boxes, refrigerated boxes, etc., are not considered permanently attached equipment. Permanently attached equipment should be included when calculating the value of the vehicle for your stated amount.
Personal Injury Protection is the basic coverage implemented in no-fault automobile insurance states. PIP is a coverage in which the auto insurance company pays, within the specified limits, the medical, hospital and funeral expenses of the insured person, people in the insured vehicle and pedestrians struck by the insured vehicle. Depending on the state, PIP may also cover lost wages and additional expenses.
Physical Damage coverage is designed to protect your vehicle. There are several forms of Physical Damage Coverage, including Collision coverage, Comprehensive coverage and Fire and Theft with Combined Additional Coverages.
A placard is a metal plaque or other form of signage found on vehicles or trucks that displays a message to the public regarding the cargo being hauled, such as hazardous, flammable or explosive.
Your current insurance policy ends on your policy expiration date, which is found on your current policy documents, Declarations Page (Dec Page), insurance identification card or recent cancellation notice. This date should not be confused with payment due dates.
It’s also important to note that in many cases, the policy actually expires just after midnight at 12:01 a.m. on the policy expiration date. This means that as of 12:02 a.m., there is no coverage.
The length of time your policy is active and in force is your policy term.
A premium is the amount of money paid to an insurance company in return for insurance protection.
A primary address is the place where you would like all communications mailed. This is typically your business headquarters.
Primary Liability insurance is Liability coverage for all trucking situations including empty and loaded vehicles.
Primary use is how you mainly use your vehicle. Primary use options include:
Business use only
Personal use only
Personal and business use
Nonbusiness use
Commercial use
The person who drives the car most often is the principal driver.
Property Damage Liability is the second part of Liability Coverage. If an insured person is legally liable for an accident, Property Damage Liability coverage pays for damage to others’ property resulting from the accident. Property Damage Liability coverage also pays for legal defense costs if you are sued.
Property insurance is a form of insurance that protects the property owned by your
business – your building, equipment, store fixtures, and more – in the case of fire, theft,
wind-related events, and/or vandalism.
The maximum distance traveled one way, as the crow flies, by an insured, from the point of garaging to the point of delivery, is the radius of operation. Depending on your state,
Extends coverage to include the breakdown or failure of a refrigerating unit.
Repair plates are license plates issued to businesses that repair, alter, recondition, equip or tow motor vehicles or trailers for the public. The plates are not assigned to a specific vehicle, which makes them unacceptable for insuring.
Repossession is reclaiming ownership of an item, such as a vehicle, because payments have not been made. Towing companies may perform auto repossession work for-hire. Progressive cannot insure towing companies that earn more than 25 percent of their income from repossession work.
The Single Deductible Endorsement is automatically applied to all vehicles with Physical Damage coverage. Instead, you are only obligated to pay the highest deductible, while the others are waived. The Single Deductible Endorsement is automatically applied to all.
A sole proprietorship is a one-owner company that is not registered with the state as an LLC or corporation. The owner of a sole proprietorship is personally responsible for the debts and liabilities of the company and reports the company’s losses and profits on his or her personal taxes.
Auto Physical Damage coverage that applies only for loss caused by listed, or “specified” perils, as compared to the “all risks” nature of comprehensive coverage.
A series of three numbers (ex. $15,000/$30,000/$10,000), split limits describe the predetermined maximum amounts to be paid on Bodily Injury Liability coverage and Property Damage Liability coverage per person and per occurrence or accident.
Example: A split limit of $15,000/$30,000/$10,000 would pay out, per accident, up to $15,000 in Bodily Injury Liability coverage for each covered person injured in the accident and up to a maximum total of $30,000 for all covered people injured in the accident. It also would pay out up to $10,000 in Property Damage Liability coverage.
A stated amount is the value submitted by the insured as representative of the current value of an insured vehicle, after accounting for depreciation and including the value of any special or permanently attached equipment.
A trailer interchange agreement is a written contract between truckers or trucking companies that provides for the loan of trailers by the owner to a third party.
Example: Joe’s Trucking Company has a trailer interchange agreement with Sue’s Trucking Company. Joe hauls a trailer full of cargo from point A to point B. Sue takes Joe’s trailer and hauls it from point B to point C for Joe.
Trailer Interchange coverage provides Physical Damage insurance for trailers that you do not own while they are in your care, custody or control, such as being hauled under a trailer interchange agreement.
If a driver or owner of a vehicle is legally liable for an accident but does not have enough insurance, you can use UIM coverage for injuries, including death, that you, your resident relatives and occupants of your insured vehicle sustain, up to the limits you select. In some states, UIM coverage is included as part of UM coverage.
If a driver or owner of a vehicle does not have insurance and is legally liable for an accident, you can use UM coverage for injuries, including death, that you, your resident relatives and occupants of your insured vehicle sustain, up to the limits that you select.
If a driver or owner of a vehicle is legally liable for an accident but does not have insurance or does not have enough insurance, you can use UMPD to cover damage to your insured vehicle, up to the limits you select. UMPD is not available in all states and may be available as an alternative to Collision coverage in others.
Learn more about Uninsured/Underinsured Motorist Property Damage (UMPD) insurance.
A VIN is a combination of 17 letters and numbers that can be used to identify the make, model and year of a car. The Vehicle Identification Number (VIN) for a vehicle is usually found on the driver’s side of the dashboard, the vehicle registration or the title.
An Unattended Trailer Warranty allows the insured to leave a trailer unattended and
have their commodities be covered by their Cargo policy. Of course, there might be
stipulations in the warranty about certain commodities left unattended.