10.02.2016 Car Insurance
Searching for a car insurance quote or renewing your existing policy can be a confusing process unless you are familiar with the terminology involved. We believe in being clear and straight and so have put together a useful glossary of the most common car insurance terminology to help our prospective and existing customers cut through the jargon and focus on finding a great deal.
Additional Temporary Driver – The addition of another driver who is not named on the policy for a temporary period of time.
Additional Temporary Vehicle – The addition of another vehicle which is not named on the policy for a temporary period of time.
Breakdown Assistance – A service which provides roadside assistance in the event your car breaks down. This may include a roadside repair or towing your vehicle to the nearest repair centre if an in-situ repair is not possible.
Car Insurance Claim – A demand made by the insured party for compensation from the insurance company in the event of a loss, subject to the terms of the insurance policy.
Car Insurance Quote – A non-binding estimate of the premium for the desired level of coverage based on the information provided by the individual seeking insurance.
Certificate of Insurance – A document which verifies the existence of an insurance policy. This document will include a summary of the policy details but is not a substitute for the actual insurance policy.
Class 1 Car Insurance – Covers the policyholder for social, domestic and personal purposes and use in connection with their business but excludes the carriage of goods or samples.
Class 2 Car Insurance – Covers the policyholder for social, domestic and personal purposes and use in connection with their business including the carriage of goods and samples.
Comprehensive Car Insurance – Offers all the benefits of third party fire and theft car insurance in addition to covering damage to the insured individual’s vehicle in the event of an accident.
Cover Note – A temporary document which proves the existence of an insurance policy in the event that the actual insurance policy is not yet available.
Fault Claim – A claim where the insured is assumed to be responsible for the accident or the insurance company cannot recover the costs from the individual responsible.
Indemnity – Protection or security against a loss which means the insurance company will compensate the insured for any loss experienced, subject to the terms of the insurance policy.
Insurance – A contract in which the insured is guaranteed reimbursement from the insurer for any loss suffered, subject to the terms of the insurance policy.
Insurance Policy – A contract between the insured and the insurer which details the terms and conditions of the insurance agreement.
Insured – The individual who is covered by insurance in exchange for the payment of a premium.
Insurer – A company that contracts to compensate an individual in the event of a loss in exchange for the payment of a premium.
Introductory No Claims Bonus – A discount on the premium offered by an insurance company in recognition of a number of years of claims free driving as a named driver on another policy.
Main Driver – The insured individual who principally uses the car, usually the registered owner.
Material Fact – Any fact which could influence the insurance premium or the insurance company’s decision to offer insurance.
Modification – A change made to a vehicle which affects its look, performance or functionality in some way.
Named Driver – An additional driver added to an insurance policy who is covered to drive the car.
No Claims Bonus – A reduction in the premium offered by an insurance company to drivers based on the number of years they have remained claim free.
No Claims Bonus Protection – A term of some insurance policies that means a no claims bonus is not affected in the event of a claim.
Non-Fault Claim – A claim where the insured is not to blame and the insurance company can recover costs from the at fault individual.
Policy Excess – A fixed amount which the insured will have to contribute in the event of a claim.
Premium – The amount paid by the insured to the insurance company in exchange for insurance.
Social, Domestic and Pleasure – Covers personal use of the vehicle and commuting to and from the insured’s permanent place of business provided that no business calls are made on the journey.
Step Back Protection – In the event a claim is made the insured does not lose their full no claims bonus.
Telematic Car Insurance – The use of a device which measures how safely the insured party drives in exchange for a lower premium.
Temporary Vehicle Substitution – The substitution of a different car on to your existing insurance policy while your insured car is being repaired or serviced.
Third Party Fire and Theft – An insurance product which compensates the insured in the event the car is stolen or damaged due to fire in addition to compensating other road users in the event of accident.
Windscreen Cover – Covers the insured for the replacement or repair of their car’s windscreen should it become cracked or broken without affecting any no claims bonus.
Now that you are comfortable with the terminology why not discover all the great benefits available with AIG car insurance or get a quote now. Or visit our car insurance blog for more top tips and advice.
Please note: that the above should be treated as a guide to common terms used in insurance and as such should be used for information purposes only. You should always check your policy wording to confirm what is being referenced by each term.