Insurance In California

We have been talking about how Insurance In California is evolving and how to avoid the trap of paying maximum premiums when you do not have to. Click here for the lowest possible price for your car or truck

IMPORTANT DEFINITIONS

Every specialized field has its own language—and auto insurance in California is no exception. Because insurance policies are legal contracts, the language in them has a big effect on how they work.

The language of an insurance policy is as important to understand as the mechanics of the policy. In this article, we’ll focus on the practical issues that policy language and definitions raise.

To get started, here’s a quick list of some important definitions as stated

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• Loss as used in an insurance policy does not generally mean misplacement—loss means a direct financial loss of value as a result of situations which are covered by the policy.

• The phrase your covered auto is used throughout the policy to refer to the specific car or cars listed in the Declarations Page. A car has to be listed—usually by vehicle identification number—in order to be considered a covered auto. It means any autos listed in the Declarations section, other vehicles acquired during the policy period and temporary substitute autos or trailers.

• The phrase non-owned autos is a relatively recent addition to standard policy forms written by some insurance companies. It relates to coverage for cars you’ve borrowed or rented.

• For a contract to be binding each party to the contract must give what is known as consideration. Your consideration is paying the premium and abiding by the policy conditions, while the company’s consideration is the protection of you and payment of claims as provided by the policy.

Insurance in California

• A collision does not have to involve smashing into something—damage caused by the upset or overturn of a covered auto is collision damage. Nor does it have to involve smashing into another vehicle—hitting an object (such as a tree, bridge or mailbox) is a collision.

A caveat: Colliding with animals or birds is not considered collision according to standard policies, and the damage would be covered only if other than colUsion (OTC) coverage has been purchased.

These quick definitions involve basic, focused concepts that are relatively easy to understand. Other concepts are more difficult. Those are the cases in which definitions become crucial issues.

We will continue to monitor changes in insurance in California in our posts. Make sure to lock in your rates before an inevitable rate hike by the end of this coming year right here

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