Information about car, auto, motor and lorry insurance
Car Insurance : all you have ever wanted to know and even more. Find out !
7 Basic Insurance Principles
According to Jack Hungelmann, author of Insurance for Dummies there are 7 basic insurance principles to follow.
Americans have a love affair with cars, and since Americans own more cars per capita than any country in the world, a good place to begin examining insurance risks is to look at those associated with the ownership, maintenance, and use of our beloved PTV (personal transportation vehicle). Unless you walk around with a loaded gun in your pocket, an automobile represents the most dangerous device you own. In one split second, you can experience lawsuits, death, long-term disability, major medical expenses, and major property darnage ! Pretty scary stuff! (source: Insurance for Dummies).
Americans and their cars
An accident is an unexpected, unforeseen event not under the control of the insured and resulting in a loss. The insured cannot purposefully cause the loss to happen; the loss must be due to pure chance according to the odds of the laws of probability. For example, under a PERSONAL AUTOMOBILE POLICY (PAP) if an accident occurs, the insured is covered for loss due to his/her negligent act or omissions resulting in bodily injury or property damage to another party (source : Dictionary of Insurance Terms)
What is an accident ?
Insurance and car rental
Renting a car, whether for business or for pleasure, puts you face-to-face with risks that your Personal Auto policy sometimes does not cover. Here are the four main sources of liability you face when renting a car:
• You have direct liability for injuries or property damage that you cause to others while operating the rental car. If you run a red light and injure others or damage their vehicle, for
example, you're at fault and responsibIe. No surprises here.
• You are directly liable for damage to the rental car that you cause by your negligent driving. If you run a red light and damage the rental car, for example, you're responsible for the
repair costs.
• You are responsible for damage to the rental car - damage that you did not cause but for which you agreed to be responsible when you signed the rental contract. Every rental contract I have ever looked at makes the renter absolutely liable for all damage regardless of fault! This clause has always been non-negotiable.
This means that you are responsible for damages such as hall damage, someone else running a red light and hitting you, someone vandalizing the car by keying it, or someone hot- whiring the car and stealing it. In short, if you return the car with any darnage at all, you owe. With the cost of new cars today, that could mean more than $25,000 if the car is totaled or stolen.
• You are liable for the loss of revenues the car rental agency suffers as a resuIt of the car being unavailable to rent while being repaired. Again, you will owe this loss-of-revenue regardless of whether you actually caused the damage. You agree to be responsible when you sign the contract.
Here's a tip for the car rental industry: If you want to attract new customers, offer more reasonable contracts. (source: Insurance for Dummies)
What is Policy
The legal contract between you and an insurance company in which the company agrees to pay covered claims when you have them in exchange for a monthly (or some other periodic) payment from you. Any given policy contains many coverages.
The 7 basic insurance principles are :
• Keep it simple
• Don’t risk more than you can afford to lose
• Don’t risk a lot for a little
• Consider the odds
• Risk a little for a lot
• Avoid Las Vegas Insurance
• Buy insurance only as a last resort
What is Premium
The price you pay for the insurance policy covering a defined time period - six months or one year (source : Insurance for dummies by Jack Hungelmann)
What is Deductible
The amount of a loss that you pay out of your own pocket before insurance kicks in.
What is Liability Coverage
A promise in an insurance policy to defend you in court and pay what you owe another person for injuries or property damage you cause
What is Liability
Your financial obligation to another person for injuries or property damage you cause
What is Peril
A cause of a loss (examples include windstorm peril and flood peril)
One of the main sources of this website is the very informative book ‘Insurance for Dummies’ by Jack Hungelmann, Packed with real-life examples, expert author Jack Hungelmann guides the reader through the traps and loopholes of the insurance system. Discover what policy combination is best for your needs and where you may have gaps.Find out how to reduce your risk and your insurance costs. Learn how to make the most of your insurance policies and what to do when there's a crisis. Click on the picture to see the special price for this book and order online
One of the main sources of this website is the very informative book ‘Insurance for Dummies’ by Jack Hungelmann, Packed with real-life examples, expert author Jack Hungelmann guides the reader through the traps and loopholes of the insurance system. Discover what policy combination is best for your needs and where you may have gaps.Find out how to reduce your risk and your insurance costs. Learn how to make the most of your insurance policies and what to do when there's a crisis. Click on the picture to see the special price for this book and order online
What is Coverage
A promise to pay a certain type of claim if it occurs (examples include automobility liability coverage, theft coverage, and so on)