Actual Cash Value
Automobile Insurance
Auto Loan Coverage
Claim
Deductible
Effective Date
Liability Coverage
Lien Holder
Medical Payments Insurance
Personal Injury Protection - PIP
Physical Damage Coverage
Policy
Premium
Uninsured Bodily Injury Coverage - UM/BI
Underinsured Motorist Bodily Injury Coverage - UIM/BI
Uninsured/Underinsured Motorist Property Damage Coverage - UM/UIM/PD

Actual Cash Value is the difference between the vehicles cost new minus the depreciation or reduction in value due to age. Depreciation also occurs with vehicle parts. For example a car tire rated to go 50,000 miles is worth less with each passing mile. In the event of a physical loss to your vehicle the company will pay the actual cash value of the stolen or damaged property or the amount necessary to repair or replace the property with other property of like kind and quality. The purpose of insurance is to return you to the same financial condition you were in prior to the loss. -Return to Top-

A contract between you and the insurance company in which you agree to pay a premium in exchange for a promise by the insurance company to reimburse you for auto related losses. There are four major areas of coverage: Liability, Physical Damage, Personal Injury Protection or Medical Payments, and Uninsured or Underinsured Motorist. These coverages are defined within this glossary. -Return to Top-

For an additional premium you can purchase coverage to reimburse you for the amount of outstanding loan balance under a finance agreement that exceeds the value of your car. This coverage is only available for newly titled vehicles, acquired by you within the prior 60 days. The cost is 5% of the Comprehensive/Collision premiums. Coverage for leased vehicles is available in Oregon and Idaho only. -Return to Top-

A demand for reimbursement for losses covered by an insurance policy. -Return to Top-

A deductible is the amount you are responsible for in the event of a physical damage loss before the insurance company begins to pay. For example, if you have a $500 deductible on your Collision coverage and your vehicle sustains $5000 in damage the insurance company would pay $4500 and you would pay $500 to complete repairs. -Return to Top-

The Effective Date is the date upon which coverage begins. -Return to Top-

Liability coverage protects you against loss due to Bodily Injury or Property Damage to another party for which any insured is held legally responsible due to an automobile accident. This coverage also includes the cost to settle or defend any claim or suit asking for these damages. Liability coverage does not cover Bodily Injury or Property Damage loss that "you" sustain in an automobile accident. -Return to Top-

This is the party that holds a loan or lease on your vehicle. The Lien Holder has the legal right to take possession of, or sell your car, to satisfy the debt or loan. Lien Holders will require that you maintain physical damage coverage to protect their financial interest in the vehicle. The insurance company sends a copy of your policy to all parties legally possessing a financial interest in your vehicle. -Return to Top-

Medical Payments Coverage pays for reasonable expenses incurred for necessary medical and funeral services because of bodily injury to you or your family members when occupying a vehicle or when struck by a vehicle as a pedestrian. It also covers any other person while occupying your covered auto. -Return to Top-

PIP provides benefits for medical and hospital expenses, funeral expenses, income continuation, and loss of services. PIP pays out benefits to covered persons, for expenses incurred because of bodily injury caused by an auto accident without regard to who was at fault in the accident. -Return to Top-

Physical Damage Coverage consists of Collision coverage and Other than Collision coverage. This coverage pays for loss to your vehicle regardless of fault. Collision coverage is the physical loss to your vehicle due to impact with another vehicle or object. Other than Collision (or Comprehensive) coverage covers other physical loss. For example, if you hit a pole in a parking lot the damage would be covered under Collision. If your car is stolen the loss is covered under Comprehensive. -Return to Top-

A Policy is a contract of insurance between the insuring company and the policyholder. The policy details all of the rights and obligations that must be met by both parties. The policyholder pays a premium and the insurance company promises to pay for losses covered in the policy. Both parties must be competent to enter into a contract. -Return to Top-

The premium is the fee you pay for the insurance. -Return to Top-

UMBI pays for damage you are legally entitled to recover from the owner or operator of an uninsured motor vehicle because of bodily injury. The bodily injury must be sustained by an insured and caused by an accident. -Return to Top-

UIM/BI pays for damage you are legally entitled to recover from the owner or operator of an underinsured motor vehicle because of bodily injury. The bodily injury must be sustained by an insured and caused by an accident. -Return to Top-

UM/UIM/PD pays for property damage you are legally entitled to recover from the owner or operator of an uninsured or underinsured motor vehicle due to an accident. -Return to Top-

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