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Insurance Glossary

Insurance Glossary




A person or entity that is authorized to solicit, negotiate and sell insurance on behalf of an insurance company. An agent can be employee or captive representing a single insurer or insurer-group, or they can be independent, representing multiple unrelated insurers.

Anti-Theft Device

A tool designed either to reduce the chance a vehicle will be vandalized or stolen, or assist in its recovery. Examples include alarms, keyless entry, remote start systems, fuel disablers, motion detectors, window etching and tracking systems.


Professional inspection of a vehicle or property after an accident or covered incident in order to estimate the damage and cost of repairs.

Auto Insurance

Auto insurance protects you and your family from legal liability resulting from an accident or in the event that your vehicle is vandalized, damaged or stolen. It also provides coverage to pay for automobile repairs, doctor and hospital visits and repairs to property such as mailboxes or fences. National General has a broad portfolio of auto insurance products and services designed to meet all your needs.


Bodily Injury Liability Coverage

Bodily Injury Liability Coverage takes care of injury or loss to other people caused by your covered vehicle. It also helps pay for your legal defense costs if you are charged with causing harm to others with your car.

Bodily Injury Limits

A bodily injury limit is the maximum amount of bodily injury liability coverage you select when purchasing an insurance policy and the most the insurance company is obligated to pay for a covered loss. Most states require a minimum amount of bodily injury liability insurance. Any amount of damages you cause in an accident that exceeds your selected bodily injury limit may be your out-of-pocket responsibility. To safeguard your assets, you may wish to select higher than minimum coverage.



An event that causes massive devastation, such as a tornado, hurricane, flood or storm.


A request from a customer or claimant to an insurance company for payment to cover a loss. Filing claims and paying out claims are handled according to your insurance company's procedures and your insurance policy.


The person presenting their insurance claim to the insurance company for payment.

Collision Coverage

Covers damage to your vehicle caused by a collision with another vehicle or object, or a vehicle rollover. While subject to deductibles and limits, your car is usually covered no matter who caused the accident when you add this coverage to your policy.

Combined Single Limit (CSL)

A single limit amount that can be used as needed for either property damage or bodily injury. For example, a CSL of $200,000 per accident means that the maximum amount the insurance company would pay for all bodily injuries and property damage caused in one accident is $200,000.
A combined single limit is an alternative to using split limits for specific bodily injury and property damage coverage limits.

Comprehensive Coverage

See Other Than Collision (OTC) Coverage.

Comprehensive Losses

See Other Than Collision (OTC) Coverage.

Consumer Report Information

Personal information about you provided by different reporting agencies such as consumer credit agencies and departments of motor vehicles that insurers use to evaluate you as a risk and/or determine the proper premium to charge you. Depending on the state and insurance company, this information could include: your credit history, your insurance score (which is determined based on information from your credit report), your motor vehicle record and your motor vehicle accident history.


The dollar amount of protection and benefits you choose in your insurance policy in the event of a loss. Examples of coverage would be Bodily Injury Liability, Property Damage Liability, Comprehensive and Collision.

Customized Equipment

Permanently installed parts and equipment like customized wheels, spoilers, paint, decals and sound systems, which were not originally part of the dealer-installed vehicle.


Declarations Page

The declarations page is usually the first page of your auto or home insurance policy. It specifies the details of your coverages, like your coverage limits and deductibles. When you are shopping for new insurance, your current declarations page is helpful in answering the basic questions about your existing levels of coverage.


The amount of money you are responsible for paying out of your own pocket when a loss occurs. A deductible amount is a standard element of any vehicle insurance policy. You can save on monthly premiums by setting a higher deductible in your insurance policy.

Defensive Driving

Techniques designed to make drivers more aware of their surroundings, reduce driving accidents and keep the roads safe. Many insurance companies offer discounts on insurance premiums to teenage and elderly drivers who have completed one or more recognized defensive driving courses.


DWI (driving while intoxicated) and DUI (driving under the influence) are legal violations that appear on your driving record if you were found to be legally intoxicated or under the influence of drugs or alcohol while operating a motor vehicle. A DWI or DUI on your driving record will increase the cost of your insurance.

Dwelling Coverage

Protects the value of the structures on your property, including things like your house and garage, according to what is specified on the declarations page of your homeowners insurance policy.



A specifically written modification to your insurance policy that changes coverage. Examples of an endorsement include adding a new vehicle to a policy or increasing the coverage amount for an appraised item with a value that exceeds what is provided in standard policy provisions. Also known as a rider or attachment.


HO-6 Policy

HO-6 is a term used in homeowners insurance, and refers to policies specifically designed for Condo and Co-op owners. The Condo Association's Master Policy usually covers the building structure and common areas, but your HO-6 coverage is what protects your personal belongings from named perils like fire, storms, explosion, and theft.
HO-6 policies also generally cover improvements you've made including private balconies or entrances, special fixtures or other additions to your property not covered by the Master Policy. Personal liability insurance is also your responsibility because you may be considered responsible for losses that occur if someone is injured in your unit.

Homeowners Insurance

Whether you live in a house, condo or apartment, homeowners insurance protects you and your assets from unforeseen events. Catastrophes like fire or other damage may result in the temporary loss of your home, damage to valuable possessions and the need to stay in another location until repairs can be made. Homeowners insurance also protects you against theft and vandalism.
Not only can safety and security devices such as fire and burglar alarms, sprinkler systems, and dead bolts help protect you and your family from harm, they can bring down your homeowners insurance rates.


Insurance Fraud

Intentionally providing false information, failing to provide information to an insurance company, or filing a claim with false information to collect payment illegally. Not only is insurance fraud a crime, it also causes insurance rates to rise for all consumers.

Insurance Premium

The amount you pay your insurance company on a periodic basis for the coverage provided.

Insurance Quote

A no-obligation estimate of insurance coverage options and cost. Click here to find a local National General agent and get a personalized quote for your vehicle, home, business, motorcycle or RV.

Insurance Score

A confidential ranking based on various factors and information found on your consumer credit report. An insurance score is one measure of the potential risk of loss. It is not a record of assets, income or demographic data. Insurance scoring is not used to determine premium in all states.


Lapse in Coverage/Policy Lapse

A period of time when your insurance policy is not in effect. Your coverage will lapse if your policy is cancelled or terminated because you failed to pay the premium, misrepresented essential information in your policy contract or for other reasons that may vary by insurance company and state.

Liability Coverage

Coverage that protects your assets if you're legally responsible for injury or damage to another person or their property in the event of an accident.
If you are at fault in an accident, you can be sued for the full cost of the damages. If this cost exceeds the amount of your Bodily Injury and/or Property Damage coverages, you may have to pay the rest. So, be sure you choose enough liability coverage to protect your assets.


The person or institution that holds a security interest of your vehicle or home if you are financing it until it is paid off. The lienholder on you home loan is also called a mortgagee. You may have special insurance coverage requirements if you are financing your vehicle or home.
You should also keep in mind that if you lease or finance your car, you may need higher coverage limits. Be sure to check with the lienholder or lease-holder to determine the appropriate level of coverage required in your case.


Stolen or damaged property and/or bodily injury that can be measured in a dollar amount and may be recovered through insurance.

Loss Prevention

Proactive steps or technology that can be used to prevent loss and reduce insurance claims, including use of vehicle immobilizers and tracking systems.

Loss of Use

Generally, this refers to the inability to live in your home, condo or apartment due to damage or destruction. Home insurance policies providing Loss of Use coverage pay towards alternate accommodations in a similar dwelling while repairs or construction are taking place following a covered loss.


Medical Payments Coverage

Payments toward the cost of medical and funeral expenses resulting from injuries sustained in an accident involving a covered vehicle. Your expenses, as well as the expenses of other passengers traveling in your car, will be paid up to your selected medical payments coverage limit, regardless of who causes the accident. In most states, this is an optional coverage, but some states require it.

Mexico Insurance Coverage

Mexican law requires vehicle Liabilty Coverage for when you are traveling in Mexico, which is required to be purchased through a licensed Mexican insurance company.

Motorcycle Insurance

If you ride a motorcycle, then you need specialized insurance coverage. National General Motorcycle Insurance coverage applies to a variety of cycle types like cruisers, touring bikes, trikes and sport bikes. It even covers custom bikes, classic motorcycles, golf carts, UTVs, ATVs and snowmobiles.


Named Perils

Named perils are specified causes of loss covered by your vehicle, homeowners, renters or condo insurance policies. Your insurance coverage will itemize the perils (risks) for which you are covered. Named perils include such things as wind, fire, hail, electrical surges, lightning, explosion, theft, vandalism and other potential causes of damage to property or people.

National Flood Insurance Program (NFIP)

The National Flood Insurance Program (NFIP) is managed by the Federal Emergency Management Agency is the primary provider of flood insurance. NFIP flood insurance through National General is financially backed by the U.S. government through the National Flood Insurance Program. National General Insurance acts as a "Write-Your-Own" company on behalf of the NFIP. "Write-Your-Own" companies sell and service flood policies and the NFIP pays the claims.
If the limits available with the NFIP are insufficient for your home, National General also offers our private flood insurance product - Beyond Flood - with higher limits.

No-Fault Protection

This type of insurance protection provides coverage for certain first-party losses in the event of an accident, regardless of who caused the accident or who was at fault. Benefits are typically medical expenses, loss of income, and funeral expense. No-fault protection is not available in all states. In states where required, coverage, limits and each party's responsibility will vary by state.


Open Perils

This type of property insurance protects your home from all perils except those specifically excluded, such as nuclear war, flood, and earthquake. Open perils may also be available on your auto insurance.

Other Than Collision Coverage

Often called Comprehensive coverage, Other Than Collision (OTC) pays toward loss or damage to your vehicle caused by something other than a collision. This includes incidents such as vandalism and theft, falling objects, and disasters such as fire, blizzards, floods and hailstorms.

Other Than Collision Loss

Often called Comprehensive losses, Other Than Collision (OTC) losses are those damages to an insured car due to fire, theft, or other losses that are not the result of a collision.


Personal Injury Protection (PIP)

Personal Injury Protection (PIP) is a form of no-fault insurance required in states with no-fault laws. It pays for medical care, lost wages and replacement services for the injured party, regardless of who is at fault in an accident.

Property Damage Liability

Coverage for the damage your vehicle causes to someone else's property as the result of an accident where you are at fault. Your property damage liability coverage is the third number in the liability coverage split limits. For example, with liability coverage of 50/100/50, you would have property damage coverage up to $50,000.


Quote Form

A form allowing you to see the coverages and a good faith estimate of the cost of an insurance policy. A quote may be subject to verification of your information, such as driving record. There is no charge to receive a quote from National General or an independent agent/broker.


Rental Reimbursement

Optional coverage that pays toward the cost of renting a car while your car is being repaired as the result of a covered accident. The amount of rental reimbursement will vary according to your coverage limits. Coverage is typically subject to you purchasing Collision and/or Comprehensive (OTC) coverage and is usually sold with per day limits subject to a total limit.

Roadside Assistance

If your car is disabled, National General provides optional roadside service and towing to a repair facility, or delivery of gas (but not the cost of the gas) for any covered vehicle up to the limit specified. Coverage is typically subject to you purchasing Collision and/or Comprehensive (OTC) coverage. The limits are displayed as the maximum amount payable per incident, followed by the maximum amount payable for the policy term. There may also be limits on the number of service calls available for each term.
National General roadside assistance provides towing for covered members 24 hours a day, 7 days a week in any passenger vehicle, anywhere in the United States or Canada.

RV Insurance

Coverage designed for most recreational vehicles, including motorhomes, fifth wheels, Airstreams, truck campers, pop-up campers and more.
Specialized RV coverage from National General provides the features RVers need that are not normally available with ordinary auto insurance policies.


Short-Rate Penalty

A charge by some insurance companies when a customer cancels their coverage early. The typical short-rate penalty is 10% of the prorated unearned premium. Check with your current insurance company about any short rate penalty before switching to National General.

Soft Credit Inquiry

When an insurance company requests a copy of your consumer credit information, this is recorded as a "soft" credit inquiry. It does not affect your credit score. This type of inquiry is used as part of the calculation of your insurance score, which assists insurance companies in determining your rates in states where permitted.

Split Limits

Three numbers are used on your insurance policy to describe the amount of liability coverage you are carrying. For example, your liability coverage may be represented as 25/50/25. In this example, your (the insured's) liability coverage limits are $25,000 for bodily injury per person per accident, $50,000 total for all injuries per accident, and $25,000 for property damage per accident.


An SR-22 may be required when insuring a driver who has a record with one of the following: no prior insurance, DUI or DWI, license suspension or other major driving violations. It is a certificate that proves you have auto insurance based upon the financial responsibility laws of your state. An SR-22 is provided by your insurance company to your state's Department of Motor Vehicles.


Third Party Coverage

The "third party" is anyone other than the insured or the insurance company who might potentially be involved as the result of an accident involving your covered vehicle. Third Party Coverage protects you against possible lawsuits that might be filed by a third party.

Total Loss

Automobile or property damage sometimes requires more money to repair than the value of the vehicle or the property involved. Because repair costs would exceed the value of the vehicle or property, the loss is considered "total."


Underinsured Motorist Coverage

Underinsured Motorist (UIM) Coverage covers damages that exceed the amount of coverage carried by a driver. This extra coverage helps protect your assets when involved in an accident with a driver who has insufficient insurance coverage for all the damages. UIM coverage varies by state. Some states treat Underinsured Motorist Coverage and Uninsured Motorist(UM) Coverage separately, while some states combine UIM and UM coverages.

Uninsured Motorist Coverage

Uninsured Motorist (UM) Coverage covers damages and injuries resulting from being hit by an uninsured or hit-and-run driver who cannot be identified. UM coverage varies by state. Some states treat Underinsured Motorist Coverage and Uninsured Motorist Coverage separately, while some states combine UIM and UM coverages.


Vehicle Identification Number (VIN)

A unique identification number for your vehicle (Vehicle Identification Number) consisting of 17 characters and marked on motor vehicles, trailers, motorcycles and mopeds. It is used to provide the model, make, year and other unique identifying information about your vehicle that is used to assist in calculating insurance rates. Since the VIN is on both your car title and your registration, it can be used to track your car's history. For example, if your car was rebuilt from salvage, you can trace this information through the VIN. This is the type of vehicle history that impacts the vehicle's value and potentially affects your insurance coverage and rates. Your VIN can usually be found on your vehicle's dash by the windshield, the driver's door, the steering column or other locations.