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Auto Insurance (USA)

„ Auto Insurance p rovides property and liability insurance coverage for the following   personal automobiles: • Private Passenger • Pick up Trucks • Trailers • Golf Carts • Snowmobiles • Motorcycles Auto insurance coverage can be: Auto Liability coverage Bodily Injury – Covers the medical expense of the passenger or the person in the car that insured hits. Property damage – covers the damaged vehicle of the victim. Unauthorized motorist BI (UMBI) – If insured is met with an accident and fault is with another driver with no insurance then it will cover the medical expense, cost of damage for you. Under insured motorist BI (UNDBI) -  If insured is met an accident with another person at fault and his insurance is not sufficient to cover your loss, this coverage will cover for the difference in the expense No-Fault Insurance (PIP) - Each driver collects from their own insurance company for medical expenses, lost wages, and related injury costs. Aut...
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Sections in insurance policies

Declarations-  Information page that provides specific details about the insured and the subject of insurance. Definitions-   This section defines terms that have specific meaning with regard to the coverage provided. Insuring agreements-  This is a statement that the insurer will, under certain circumstances, make a payment or provide a service. Exclusions -  These are policy provisions that eliminate coverage for specific exposures. Conditions -  These are conditions related to the coverage provided. Miscellaneous provisions-  Contain provisions that do not qualify as one of the components described above.
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Insurance Process Flow

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Types of Insurance

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Insurance Glossary

Insured - Person/Persons covered in insurance policy Insurer - insurance company Insured property - Property covered in insurance policy in case of property insurance Agent -   I ndividual who sells and services insurance policies in either of two classifications:    Independent agent represents at least two insurance companies    Direct or career agent represents only one company and sells only its policies. Broker -   Insurance salesperson that searches the marketplace in the interest of clients, not insurance companies. Casualty Insurance -   That type of insurance that is primarily concerned with losses caused by injuries to persons and legal liability imposed upon the insured for such injury or for damage to property of others. It also includes such diverse forms as plate glass, insurance against crime, such as robbery, burglary and forgery, boiler and machinery insurance and Aviation insurance. Many casualty companies also w...
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Insurance Definition

Insurance can be understood as a • Transfer system – Transfers the chance of loss to another party – Sharing the loss by pooling the money and sharing the loss among all insured • Business – A set of operations that generate sufficient income to pay claims and yield profit to owners • Contract – Specifies the potential costs of loss that is being transfer from insured to insurer Insurance Company prefer to provide Insurance for the Financial consequences of Loss Exposures that possess Characteristics as: Large number of similar Exposure Units. Losses that are Accidental. That aren’t Catastrophic. Definite and Measurable. Economically Feasible to Insure
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Insurance Principles

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Insurance is driven by the following concepts and it is important for us to understand them: Law of Large numbers: As the number of similar but independent  Exposure units  increases the relative accuracy of predictions about future outcomes (Losses) based on these exposure units also increases. For example in Home Owner’s Insurance each Home insured is a Exposure Unit. Exposure Units such as cars and Houses are independent if they are not subject to the  same event.  Principle of indemnity: Insurance is a process of covering the potential losses by providing a financial security to insured persons by bringing them back to the same position before the loss happened. A person cannot be benefited out of the insurance transaction.  This happens by collecting a small amount called as premiums from a large pool of people with similar exposure and the losses are compensated when there is an unexpected loss for one of the insured.
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