Texas Auto Insurance Definitions

• April 18, 2010
• Auto Insurance,Frequently Asked Questions

Have you ever wondered what some of the words you find in your auto policy, or insurance cards mean? Below we define the more important ones you will come across.

Texas Auto Insurance Definitions

• Actual Cash Value (ACV)

  The value of your property, based on the current cost to replace it minus depreciation.

• Bodily Injury (BI)

  Physical injury to a person.

• Deductible

  The amount the insured must pay in a loss before any payment is due from the company.

• Depreciation

  When an item´s value is lowered because of use or wear and tear.

• Endorsement

  When attached to a policy, this written agreement expands or limits benefits otherwise payable under the policy. Also known as a “rider.”

• Gap Insurance

  This pays the difference or “gap” between the actual cash value of a vehicle and any unpaid amount on the loan. Some gap policies may also cover the deductible.

• Liability Insurance

  When you cause an accident, this pays for injuries to the other party and damages to the other vehicle. Also pays for accidents caused by someone covered by your policy, including someone driving your car with your permission.

• Liability Limits

  The maximum amount your liability policy will pay. Higher liability limits can be purchased for an additional premium.

• Property Damage (PD)

  Physical damage to property.

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2 Comments for this entry

• 

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4 Trackbacks / Pingbacks for this entry

• Comprehensive vs Liability Coverage: Don't Take A Chance With Your Auto | www.clementsinsurancegroup.com | Clements Insurance Group, LLC, April 18th, 2010 on 9:04 pm

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• Texas Liability Insurance: Superior Service & Expert Advice | www.clementsinsurancegroup.com | Clements Insurance Group, LLC, April 18th, 2010 on 9:05 pm

  [...] family members are driving in the state of Texas, you are required to have Texas auto insurance. Bodily Injury Liability insurance (BI) and Property Damage Liability insurance (PD) is a requirement by the state of Texas that the insured be covered for damages due to bodily injury [...]

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