Glossary

There are many terms in the insurance industry that are used by agents and adjusters that may seem like a foreign language to the general public. Hopefully this glossary of terms will help you understand the terms used to define Insurance Policies. Remember that The Pfister Insurance Agency can provide all the information you’ll need to understand and develop your insurance protection program.



  • Accident - any event that is unforeseen, unexpected, and unintended




  • Bodily Injury - means bodily harm, sickness or disease, including required care, loss of services and death that results from a covered event




  • Bodily Injury Coverage - pays for accidental injury you cause to others while operating your vehicle




  • Collision Coverage - pays for damage to your vehicle from collision with another vehicle or object




  • Comprehensive Coverage - pays for damage to your car by accidents such as fire, theft, flood, windstorm, vandalism, hitting an animal, or falling objects ( Sometimes called other-than-collision )




  • Deductible - the amount of a loss paid by the policyholder. Usually a specified dollar amount, but can be a percentage of the claim amount. Usually the lower the deductible, the higher the premium will be for the same coverage




  • Endorsement - a written form attached to an insurance policy that changes the policy's coverages, terms, or conditions. Sometimes called a Rider.




  • Full Coverage - generally means that your insurance policy has both liability coverage and coverage for damage to your vehicle - Collision and Comprehensive coverage. The term "full coverage" doesn't mean that "everything" is covered no matter what happens




  • Liability - one's legal obligation to pay because of bodily injury or property damage caused to another person




  • Liability Coverage - that part of your insurance policy that states the maximum amounts payable in the event of a claim against you for bodily injury or property damage caused to another person




  • Liability Insurance - insurance for what the policyholder is legally obligated to pay because of bodily injury or property damage caused to another person




  • Liability Limits - the maximum amount of liability coverage provided by the policy you choose




  • Loss Assessments - provides coverage for assessments leveled against you as an owner or tenant, by a corporation or association of property owners. The assessment must be made as a result of direct loss to the property, owned by all members collectively, of the type that would be covered by your policy if owned by you. Generally applies to Condominium owners or Homeowners, who are members of an Association




  • Loss Of Use - provides additional living expense when your insured residence becomes unfit to live in due to a covered loss. During repairs, it will pay for any additional necessary living expenses incurred while living out of the residence until it becomes fit to live in again




  • Medical Payments - pays medical ( and may pay funeral expenses, depending on your policy ) for you, members of your family,and other passengers in your auto. It may also include benefits in any other vehicle driven by you or a family member. It also includes coverage for family members while a pedestrian, when struck by another vehicle designed for use mainly on public roads.




  • Occurrence - means an accident, including continuous or repeated exposure to substantially the same general harmful conditions, which results, during the policy period, in Bodily Injury or Property Damage




  • Perils - specific risks or causes of loss covered by an insurance policy, such as fire, windstorm, flood, or theft. A Named Peril policy covers the policyholder only for the risks named in the policy in contrast to an All Risk policy, which covers all causes of losses except those specifically excluded




  • Preferred Risk -




  • Proof Of Insurance - a document, often times required by mortgage holders or lien holders, to show their client has sufficient insurance in force to protect them from a total loss of the indebted property




  • Property Damage - means physical injury to, or destruction of, or loss of use of tangible property




  • Property Damage Coverage - pays for damage to the property of others you cause while operating your vehicle




  • Rental Reimbursement - pays for the cost to rent an auto when yours is being repaired due to damage from collision or comprehensive, up to the limits of your policy




  • Roadside Assistance - provides coverage for reasonable and necessary charges resulting from towing, winching, lockout services, gasoline delivery, etc., up to the limits of your policy




  • Umbrella Policy - provides coverage for losses above the limit of an underlying policy or policies such as homeowner's and auto insurance. While it applies to losses over the dollar amount in the underlying policies, terms of coverage are sometimes broader than those of the underlying policies




  • Underinsured Motorist - pays for bodily injury to you, and in some cases, physical damage to your auto, caused by a motorist who does not carry enough insurance to cover the costs of the damages caused by them




  • Uninsured Motorist - pays for bodily injury to you, and in some cases, physical damage to your auto, caused by a motorist who does not carry any auto insurance