Commercial Auto Insurance Terms
Actual Cash Value - The cost to replace a company vehicle with a vehicle in the same condition. Wear and tear of the vehicle, age, and mileage impact the actual cash value.
At-Fault - If your employee causes an accident, they are “at-fault” and legally liable for the damages in an accident.
Carrier - The company providing the business auto insurance is known as the carrier.
Certificate of Satisfaction - A form signed by the insured when the insured takes delivery of a car from the repair shop indicating satisfaction with the repairs.
Declarations Page - This is a page in the policy including basic details, such as your name and address and a description of the vehicle(s) insured; the effective dates of the policy; the amount of insurance coverage and the premiums.
Endorsement - An endorsement modifies the policy by amending specific coverage. It can add coverage, modify it and even decrease or eliminate coverage.
Exclusion - This is a restriction in one’s business auto insurance decreasing and/or removing coverage for a number of potential events, persons, property or locations.
Financial Responsibility Law - This law mandates owners and drivers of vehicles have enough money on hand to compensate individuals who they injure. Liability insurance is the most common form of coverage to satisfy the financial responsibility requirement.
Legal Liability - This is liability (or responsibility) imposed by a law, as opposed to liability coming from a contract or other agreement.
Medical Payments Coverage - This insurance reimburses the driver or passenger of a vehicle for medical or funeral expenses incurred due to an automobile accident. This is regardless of whether the accident was their fault. It also covers medical expenses of pedestrians that an employee may have injured.
No-fault Insurance - This coverage, for employees in a no-fault state as determined by law, pays for medical expenses, lost wages, or other accident-related expenses regardless of who is deemed responsible for the accident.
Personal Injury Protection - This coverage is part of a no-fault policy if the employee lives in a no-fault state. It pays for medical treatment, lost wages, or other medical costs related to the accident regardless of who caused the accident.
Third Party - This refers to an individual or other entity not party to an agreement but who may become involved in an indirect way or impacted by it.
Total Loss - This is the condition of a vehicle or other property when the damage sustained is so high that repair expenses would top the value of the vehicle or property.