Insurance Basics: Coverage and Loss Definitions

A type of insurance coverage that may be purchased when the full amount, kind, or class of insurance cannot be obtained from admitted insurers in a particular state.

An insurer that is not authorized to do business in a particular state.

A state-run fund that protects policyholders in case an admitted insurer becomes insolvent.

The process of seeking insurance coverage from other insurers before renewing a policy with a non-admitted insurer.

Federal regulations that prohibit transactions with individuals or entities on a list of Specially Designated Nationals and Blocked Persons, often associated with terrorism.

A policy provision that makes certain coverage void if it violates applicable laws or regulations.

Compliance with surplus lines stamping requirements, payment of surplus lines taxes and fees are the responsibility of the insurance producer or broker.

A set of insurance coverages that protect against financial losses related to a vehicle.

Insurance Coverage that protects against financial losses due to bodily injuries or property damage caused by an insured driver, regardless of fault.

Insurance Coverage that protects against medical expenses incurred by the insured driver and passengers in an accident, regardless of fault.

A situation where a person is legally responsible for the injuries or damages caused by someone else.

Optional Insurance Coverage that extends coverage for specific events beyond the standard Personal Injury Protection (PIP) limits.

A situation where a person is legally responsible for damages or injuries caused by their employees while working.

This coverage excludes injuries to an employer's employees that occur during the normal course of their work.

Insurance Coverage that protects against damages to an insured vehicle caused by a collision with another vehicle or object but not from other scenarios.

Injuries to a worker's family members caused by an incident related to the employee's work.

Insurance Coverage that protects against damages to an insured vehicle caused by non-collision events like theft, vandalism, or natural disasters.

Injury to a fellow employee that happens while they're working.

The person or organization to whom a covered vehicle has been furnished.

Injury to a fellow employee's family member that happens as a result of a work-related incident.

The number of trips a driver makes to deliver or pick up vehicles.

Damage to property owned, rented, or occupied by the insured.

The insurance premium associated with the delivery of automobiles.

An insurance category that separates dealers based on whether or not they are franchised.

Costs associated with cleaning up pollution or contamination caused by the insured.

This exclusion doesn't apply to domestic employees who don't qualify for workers' compensation.

This exclusion applies to injuries to domestic employees that occur while they're working.

A schedule that details vehicles covered by insurance for individuals or entities other than Class I or Class II operators and those insured on a specified car basis.

A Class I operator is usually a large corporation or government entity that owns and operates a large fleet of vehicles. Class II operators are smaller entities that manage a fleet of vehicles.

This refers to the specific details about a vehicle, including its make, model, year, and vehicle identification number (VIN).

Cost New refers to the estimated price to replace the vehicle if it were completely destroyed.

A Class code is a numerical designation used for classifying vehicles based on their type, use, and risk for insurance purposes.

This refers to the various insurance coverages, including liability protection for damage to others (liability premium), protection against damage to your own vehicle (comprehensive and collision), and personal injury protection (PIP) which is also related to Medical Payments.

The cost you pay for the liability coverage, which protects you if you injure someone or damage their property in an accident.

This refers to personal injury protection (PIP) coverage, which helps pay for medical expenses and other expenses related to injuries in an accident.

Deductible is the amount you pay out-of-pocket before the insurance company starts covering the rest. This typically applies to collision and comprehensive coverage.

The maximum amount an insurer will pay for a covered loss, regardless of the actual cost of the loss.

An individual or entity covered by an insurance policy.

Payments made by an insurer in addition to the primary coverage, such as expenses incurred in settling a claim.

When the total amount paid out for covered losses reaches the policy's limit, the insurer's responsibility to defend or settle further claims ends.

The amount an insured is required to pay out-of-pocket before the insurance policy starts covering losses.