Have you ever sat down and taken a good look at your auto insurance policy? If you have, you already know that most of it isn't written in English! Insurance-ese might not be a legal language, but it definitely ought to come with its own translation device. Since most policies don't come with a handy pocket grammar guide, however, it's up to you to take your best guess at the meaning behind all the auto insurance terminology they're throwing your way to figure out what your policy is really saying.
The question is, how well do you know your auto insurance terminology? Take this short quiz and find out!
1) What does comprehensive coverage mean?
a) That you're completely covered against everything that could ever possibly happen to you, from now to eternity.
b) That your insurance company will pay for the damages to your car after you hit another driver head on.
c) That your insurance company will total your car if it's damaged by an act of God.
2) What does it mean to be continuously covered?
a) That you walk around all day covered by a blanket.
b) That your insurance coverage has never lapsed, even for a day, for a set period of time.
c) That you had a few slips due to late payments, but you're insured most of the time.
3) What does collision coverage do?
a) Pay for the damages to your windshield after an icicle crashes through it.
b) Fixes your car up after you go sliding into another car's bumper.
c) Puts rubber bumpers on your car so you're not injured in an accident.
4) What is "No Fault" auto insurance?
a) Insurance that protects you from legal liability in an accident
b) Insurance that stops any cars from blaming you for accidents that were really their fault (even if you did cause it)
c) Insurance that pays for your damages after an accident and lets the other driver's insurance company take care of theirs, no matter who was at fault.
5) What is a deductible?
a) The money you pay your insurance company when you file an insurance claim.
b) The payment you make each month for the privilege of being insured.
c) The amount you have to pay when your insurance company won't handle your auto insurance claim.
Answers:
1) c. Comprehensive coverage is intended to protect your car from unforeseeable and unpredictable events, usually referred to as "Acts of God." Plagues, locusts, hail storms-your comprehensive auto insurance has you covered.
2) b. Most of us have a fairly loose opinion of what it means to be continuously covered, but your insurance agent frowns on lapses of any kind-even the 24 hour ones.
3) b. Liability insurance takes care of everybody else, but collision coverage takes care of you.
4) c. With No Fault insurance it doesn't matter who caused the accident. Each company takes care of its own driver and everyone walks away happy. (Except the person who actually was at fault-they're going to watch their auto insurance rates climb dramatically.)
5) a. Your deductible is the money you agree to pay in exchange for your insurance company promising to take care of the rest of your accident related expenses. Your deductible is going to have a huge impact on your monthly premiums.
