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Hiring Assessment: Insurance Terms
Terms in this set (27)
This is the maximum amount of money that an insurer is contracted to provide the policy holder in a specific policy period. For example, on a particular business liability policy an annual aggregate limit would be the total amount the insurance company would pay for all claims on that policy in a given year.
This policy allows a business owner to insure multiple property types at one location, or one property type at multiple locations, all under one policy.
Builders risk insurance
Provides protection for all building materials - on-site, off-site, and in transport - that a builder uses during the course of a construction process.
Business interruption insurance
If your business must shut down due to a covered loss, this form of coverage can provide reimbursement for the expenses that would have normally occurred if the business had been operating.
Business owners policy (BOP)
This is a combined policy where property insurance and liability insurance are packaged together at a cost savings for small businesses.
This is a type of insurance that protects an employer from dishonest employee acts.
Commercial property insurance
This policy is meant to protect the building and other business property that you own or lease. Note that equipment insurance is typically a separate policy.
An accident is a sudden, unexpected event or occurrence that causes bodily injury or property damage. The event may be at-fault, not-at-fault, reported or unreported. An example of a not-at-fault accident could be where your parked vehicle is struck by another vehicle.
Actual Cash Value (ACV)
A vehicle's actual cash value, also called the market value, is essentially the price someone would pay to purchase that exact vehicle today. It's determined by evaluating a number of factors, including the vehicle's age and condition, as well as any prior damage, improvements, or special equipment.
A company or person who may be liable for an accident that involves an insured person or vehicle can be added to the policy as an additional insured.
Example: A general contractor can be an additional insured.
A device, either active or passive, that attempts to prevent vehicle theft. Active anti-theft devices can track and recover a vehicle and automatically contact a response center to begin the vehicle recovery process. Passive anti-theft devices attempt to prevent theft by using sophisticated electronic car alarms, simple steering wheel locks, etc
Any Auto Coverage
Any Auto coverage extends Liability insurance to hired and other non-owned vehicles, and vehicles you purchase during your policy term. It extends the same Liability coverage and limits you carry for the vehicles already listed on your policy to the unlisted vehicles. Any Auto coverage requires a contractual agreement stating the need for the coverage. Other restrictions could apply.
Any Auto Coverage:
Any Auto coverage extends Liability insurance to hired and other non-owned vehicles, and vehicles you purchase during your policy term.
Who Needs Any Auto Coverage?
Many small businesses are required by their customers to carry insurance that covers all owned, hired, and non-owned vehicles. Businesses that are eligible for Any Auto coverage include:
Other select business types
Any Auto Coverage Exceptions and Restrictions
In order to purchase Any Auto coverage, you need to have a contractual agreement stating that you need this type of coverage.
It's important to note that Any Auto coverage can't be purchased if you have Hired Auto or Employer's Non-Ownership coverage, and Any Auto coverage doesn't include Physical Damage coverage, such as Collision or Comprehensive.
Any Auto coverage only extends coverage to recently purchased vehicles until the end of your current policy term. When you receive your renewal quote, you or your agent will need to contact Progressive to update your listed vehicles on your policy to ensure they have Liability coverage.
Any Auto Coverage Example
You're a general contractor with a commercial auto insurance policy for your vehicles. Before it's time to renew your policy, you buy a new truck, forget to tell your insurance company, and then get into an accident.
Your commercial auto insurance policy would normally cover this liability if the accident happened within 30 days of buying the truck, but the accident happened 60 days after you bought the truck.
In this situation, your Any Auto coverage could provide Liability coverage for the unlisted vehicle.
Exceptions and Restrictions
Any Auto coverage may not be available in all states or situations. Your coverages may differ from the examples above. Refer to your policy or contact us to learn more about coverages specific to your situation.
Although Bobtail coverage is often used interchangeably with Non-Trucking Liability coverage, technically they are not the same thing. Bobtail insurance protects a tractor when it's operated without a trailer, whether or not it's under dispatch, while Non-Trucking Liability coverage only covers a vehicle when it's driven for personal, nonbusiness use.
Bodily Injury Liability Coverage (BI)
Bodily Injury Liability is one part of Liability Coverage. If you are responsible for causing an accident, Bodily Injury Liability coverage pays for injuries/death to people involved in the accident. Bodily Injury Liability coverage also pays for legal defense costs if you are sued.
Combined Single Limit (CSL)
CSL is a single number that describes the predetermined limit for the combined total of the Bodily Injury Liability coverage and Property Damage Liability coverage per occurrence or accident.
Example: A CSL of $1 million pays up to a combined total of $1 million for both Bodily Injury Liability coverage and Property Damage Liability coverage for any single accident.
Commercial Driver's License (CDL)
A CDL is a special license needed by operators of tractors, vehicles over 26,000 GVW, or vehicles carrying more than seven passengers.
A commercial vehicle is any vehicle used for business purposes. Also called commercial auto, corporate car, corporate vehicle, business auto, business car or business vehicle.
If your insured vehicle is damaged due to an event other than a collision, Comprehensive coverage will pay for the damage. This includes damages from fire, theft, windstorm, flood and vandalism.
Comprehensive Coverage with Full Glass Protection
If you need to replace a window or windshield due to a non-collision incident, Comprehensive coverage with Full Glass Protection pays to replace it and waives the standard deductible, which you would usually have to pay out of pocket. This coverage is not available in all states
Collision coverage is one of three options that, along with Comprehensive coverage and Fire and Theft with Combined Additional Coverage (CAC), makes up Physical Damage insurance.
Collision insurance provides protection for your vehicle in case it is damaged in a collision. Collision insurance pays to repair or replace your vehicle if it:
Collides with another object
Overturns or rolls
Who Needs Collision Coverage?
If you want to protect your vehicle from collisions with other vehicles or objects, you should choose Collision insurance. Collision coverage pays for damage to your vehicle — including if it is totaled — in case of a collision.
Collision coverage is always sold with either Comprehensive insurance, which protects your vehicle in non-collision incidents, such as theft or vandalism, or Fire and Theft with CAC, which is a more limited form of Comprehensive insurance designed for specific heavy truck types.
If your vehicle is leased, then you probably are required to have Collision insurance. If your vehicle is fully paid for, Collision coverage is optional.
Collision Insurance Deductibles and Other Details
For Collision insurance, you must pick a deductible, which is the amount that you agree to pay out of pocket when you have a claim.
Choosing a higher deductible is an easy way to lower the price of your insurance. Be sure you choose a deductible that you can afford to pay out of pocket at any time.
When you select Collision insurance, you are also required to submit a Stated Amount, which is your best estimate of the current value of your vehicle. The Stated Amount should take the age and condition of your vehicle into account, as well as any permanently attached equipment. Collision Insurance Examples
You're driving down the street and rear-end the car in front of you.
Your Liability insurance will pay for the damage to the other person's car, and your Collision insurance will pay for damage to your own vehicle because this was an accident in which you collided with another vehicle.
If you selected a $500 deductible, you would pay the first $500 out of pocket to have your vehicle repaired or replaced, depending on the extent of the damage. Collision Coverage Exceptions and Restrictions
You must have Comprehensive insurance or Fire and Theft with CAC in order to select Collision insurance.
You can purchase a Physical Damage Only policy, which would include two insurance coverages only:
Either Comprehensive insurance or Fire and Theft with CAC
Collision insurance cannot be applied to non-owned trailers, such as those used as part of a Trailer Interchange Agreement. Collision coverage for non-owned trailers can be purchased separately as part of Trailer Interchange insurance.
Collision Insurance State-Specific Details
Each state has its own regulations regarding insurance coverages. Some coverages may not be purchased in conjunction with Collision insurance. Your agent or representative will inform you of any state-specific details when you purchase your policy.
Being continuously insured means your insurance coverage was in effect at all times, without a break or lapse in coverage for any reason.
A corporation is created to function as a separate legal and tax entity, independent of the people who own and manage it. It can enter agreements, incur debts and be taxed apart from its owners. A corporation is required to file articles of incorporation with its home state, create corporate by-laws, issue stock certificates and comply with a number of corporate formalities.
Coverage is the word used to describe protection for an insured as provided by an insurance policy. A particular coverage may refer to a specific component of insurance that provides protection under a given set of circumstances.
People who travel from home, working a few weeks at a time at various locations harvesting seasonal crops, are custom harvesters. They sometimes also are called agricultural workers or migrant workers.
Sometimes also called "Bobtail coverage." Although Bobtail or Deadhead coverage is often used interchangeably with Non-Trucking Liability coverage, technically it is not the same thing. Bobtail insurance covers a tractor when it's operated without a trailer, whether or not it's under dispatch, while Non-Trucking Liability coverage only covers a vehicle when it's driven for personal, nonbusiness use.
Declarations Page (Dec Page)
Also known as an auto insurance coverage summary, this page is provided by your insurance company and lists the following:
Types of coverage you have elected, Limit for each coverage, Cost for each coverage
Specified vehicles covered by the policy, Types of coverage for each vehicle covered by the policy, and Other information applicable to the policy.
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