Let's be honest: reading an auto insurance policy is not a popular pastime. After all, an insurance policy is really a legal contract. It contains a lot of dry, technical legal language as well as jargon specific to the auto insurance industry--not exactly Saturday afternoon leisure reading. Nonetheless, it's probably a good idea to sit down and thoroughly read your policy.  

Ideally, you did this when you bought the policy. It only makes sense to read a contract before entering into it so that you're fully aware of your rights and obligations, among other things. If you didn't, you really should read your policy at some point, and then contact us with any questions or concerns.

Declarations page
Like other insurance contracts, your policy begins with a declarations page. This page identifies the policy number and provides important information including the policy term, coverage limits, and information about the insured. If you bought the policy for your car, you are probably the named insured. If so, the declarations page will contain your full name, and may also contain the names of family members and other drivers in your household. Also included here is your complete legal address, which may differ from the address where the covered auto is principally kept. The address where the car is kept helps determine your premium, but it is your legal address to which all correspondence about the policy will be sent.

If you got a loan to purchase your car and there is still an outstanding balance, the lender will be listed as "loss payee" on the declarations page. Because your lender has a financial interest in your car, they are entitled to receive payment under your auto policy if the car is damaged or destroyed. Consequently, information about your lender must be listed in the "loss payee" section of the declarations page.

The declarations page also contains a description of the vehicle(s) covered under the policy. This description includes each vehicle's year, make, model, serial number, address where garaged, etc. The declarations page also indicates how each vehicle is used (i.e., for pleasure, business purposes, commuting to work, etc.). Your premium will be partly based on this information about your car.

If you elected to purchase one or more "endorsements" to expand and/or restrict the coverage your policy offers, these will be identified on the declarations page by name, form number, and date. The endorsements must be listed here in order for your insurer to provide that particular coverage. Finally, the declarations page shows the annual policy premium--the amount you're paying your insurer for the insurance coverage. The total premium is a figure that results from adding up the separate premiums charged for each specific type of coverage.

Insuring agreement
Your policy contains a general insuring agreement, which is basically a broad statement listing the perils and risks covered under the contract. The insuring agreement also identifies exclusions, which are specific events and circumstances the policy will not cover. These noncovered situations are spelled out explicitly so as to minimize the policyholder's confusion about what's covered and what's not. Definitions of terms commonly used throughout the policy are included in the insuring agreement, as are certain special provisions. The purpose of these special provisions is to prevent policyholders from taking unfair advantage of their auto insurance. For example, one special provision requires you to notify the insurance company if you want to add new vehicles to your policy. Otherwise, you could insure multiple vehicles under the same policy without informing your insurer, and obtain coverage for all of them with no premium increase.

The ISO Policy Form
The auto policy is completed with the attachment of the ISO Personal Auto Policy Form to the declarations page. This form spells out in detail the six main auto insurance coverages provided under the policy.

Part A--Liability Coverage: This provides protection against losses to an insured, caused by bodily injury or property damage to someone else that arises out of the use of an insured vehicle.

Part B--Medical Payments Coverage: This provides coverage for various medical expenses incurred by the insured and others as a result of an accident, regardless of negligence or liability on the part of the insured.

Part C--Uninsured/Underinsured Motorists Coverage: This provides coverage for losses the insured and others sustain when injured through the negligence of an uninsured, underinsured, or unidentified "hit-and-run" motorist.

Part D--Coverage for Damage to Your Auto: This provides coverage for losses the insured suffers as a result of damage to his or her covered vehicle (and/or its contents). This coverage consists of two parts: collision (for collision-related damage) and comprehensive (for damage not caused by a collision).

Part E--Duties after an Accident or Loss: This section imposes various requirements on the insured in the event of an accident or other loss. If you do not comply with the duties spelled out in this section, you may forfeit your contractual rights under the policy.

Part F--General Provisions: This section specifies certain conditions that apply to the entire policy or insuring arrangement. These include provisions for fraud, bankruptcy of the insured, and cancellation of the policy, among other things.

Learn More...

Auto Insurance Overview | Understanding The Basics | Coverage Options
Safety & Tips | Choosing A Policy | Filing A Claim | Car Rentals & Motorcycles

Please Note: The information contained in this Web site is provided solely as a source of general  information and resource.  It is a not a statement of contract and coverage may not apply in all areas or circumstances.  For a complete description of coverages, always read the insurance policy, including all endorsements.