Deciphering Your Auto Insurance Policy

Your auto insurance protects you and your family in many situations, but do you know exactly what you’re covered for? Your auto policy document may be confusing, but it doesn’t have to be.

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Learn the basics of your policy with this helpful glossary.

  • At Fault
    • The party that is found at fault is the one that is legally liable for the damages in an accident.
  • Bodily Injury Liability Coverage
    •  If you are at fault, this helps pay the medical costs, loss of income, and even funeral expenses of other people involved in the accident.
  • Claim
    • Any request for payment under the terms of the policy.
  • Collision Coverage
    •  This coverage is what pays the damage when the vehicle collides with another car or object.
  • Comprehensive Coverage
    •  If your car is damaged from anything other than a collision, the comprehensive coverage will pay the damage. If your car is stolen, vandalized, or hit with a natural disaster, you’re covered. 
  • Deductible
    •  The portion of a claim that you pay out of pocket.
  • Driver Status
    • People can be added to your policy with one of the following driver status options:
      • Rated – A person that actively drives the vehicles on the policy
      • Excluded – This person is not allowed to drive the vehicles and will not be covered in an accident
      • Listed – A member of your household who doesn’t frequently drive the vehicles on the policy.
  • Premium
    •  The price of the policy that you pay in exchange for coverage.
  • Property Damage Liability
    •  Helps pay the repairs or even replacement of another driver’s car.

Don’t let confusing jargon keep you from fully understanding your auto insurance. If you’re unsure about any terms or what you should be looking for in a policy, ask your insurance agent for help. Looking for a quote on auto insurance? Call Michigan First Insurance Agency at 844-788-0818 or learn more online here