Understanding What My Car Insurance Policy Says

Auto Insurance is a must in every state in the U.S. unless you feel like driving your car without insurance – which is against the law. Although not a must but a good idea is to knowing what your auto insurance policy says. Many motorists do not know what their policies say.
Think for minute, when was the last time you sat down and read your policy? I know for myself it has been awhile, and as part of working on this article I decided to sit down and read through. I also did some Internet research and found out that most policy paperwork is the same and is basically presented in a standard way.

What Is Included In My Car Insurance Policy?
First of all, your insurance policy is a legally binding contract and it is important to read thoroughly so that you fully understand what coverage you have. There are five separate sections which will be further defined in the information contained below. Included are (1) Declarations, (2) Definitions, (3) Conditions (4) Insuring Agreement and (5) Exclusions. Some of these parts might be combined into the same sections, but in general all of these sections should be included for your consideration.

Declarations
Usually the first to be mentioned in your auto insurance policy is the Declarations, which normally has its own section and will be personally prepared for you. This lists items such as (1) make, model and year of your car, (2) Next would be the Vehicle Identification Number (VIN), (3) then the insured names such as you or your wife or husband’s name, (4) dates of policy coverage (5) limits and coverage of policy and (6) cost of having this insurance, which is called the premium.
Occasionally other information is requested such as whether any car is used for business or pleasure and if your car has a lien against it by a bank or finance company. If there is a lender, this name is listed to receive the loss benefits in case of car being totaled in an accident. This is called the loss payee.
You will also find coverage information here about your collision and comprehensive coverage, bodily injury, uninsured motorists bodily injury, underinsured motorists bodily injury, property damage, full glass coverage, rental car reimbursement, and even towing. Your policy may have more or less of these riders depending on how your policy is set up. If you have questions about your policy coverage call your auto insurance agent.

Definitions
Definitions explain all the insurance conditions and information so there’s no misunderstanding in your coverage.

Conditions
Conditions are important if you are ever in an accident as it explains your responsibilities as the insured and how to file a claim. This also covers notifying your insurance company and informing the police department. Should you choose to cancel your policy for some reason, this information is included in this section.

Insuring Agreement
The next part to discuss is the Insuring Agreement. This is central to your policy as it covers exactly what the insurance company promises in exchange for your premium payments. Explanations of policy type, coverage purchased, and name of persons listed as the insured are described here.

Exclusions
Another important section to be considered is called Exclusions because it lists the conditions not covered by your policy and mentions all situations where the insurer won’t be responsible for paying a claim. This would mean benefits would not be paid if the insured deliberately causes damage or injury. Again, be certain you understand all conditions and exclusions in your policy so you will not be caught unaware should you be refused coverage benefits.
Like I said in the beginning, knowing what your policy says is important. I actually learned in my policy that I don’t have to buy insurance when I rent a car as my insurance company will cover that for me. I also learned that I have windshield coverage to replace a cracked windshield one time a year. What are you going to learn from reading yours?
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