Bluemont Virginia Auto Insurance

Insurance Information
Cancellation
The discontinuance of an insurance policy before its normal expiration date, either by the insured or the company.

Captive Agent
A licensed insurance agent who sells insurance for only one company.

Captive Insurance Company
A company owned solely or in large part by one or more non- insurance entities for the primary purpose of providing insurance coverage to the owner or owners.

Casualty Insurance
Insurance concerned with the insured's legal liability for injuries to others or damage to other persons' property; also encompasses such forms of insurance as plate glass, burglary, robbery and workers' compensation.

Catastrophe
Event which causes a loss of extraordinary magnitude, involving a large number of people, such as a hurricane or tornado.

Cede
To transfer all or part of a risk written by an insurer (the ceding, or primary company) to a reinsurer.

Certificate of Insurance
A statement of coverage issued to an individual insured under a group insurance contract, outlining the insurance benefits and principal provisions applicable to the member.

Cession
Amount of the insurance ceded to a reinsurer by the original insuring company in a reinsurance operation.

Claim
A request for payment of a loss which may come under the terms of an insurance contract.

Claimant Vehicle
Vehicle owned or driven by another party involved in a loss.

Claims Adjuster
Person who investigates and/or settles claims - an agent, company adjuster, independent adjuster, adjustment bureau, or public adjuster

Class Factor
Class factors (also referred to as driver class factors) are based on the age of the driver and the usage of the vehicle. It is one of the main components used in rating auto policies. The factor is applied to the base rate and specific coverages.

Collision
A form of insurance protecting the insured against loss resulting from any damage to the insured's vehicle caused by collision with any object whether or not it was the insured's fault. Requires comprehensive coverage.

Collision for Rental Vehicle
Collision coverage, which may be purchased on liability only policies to cover rented vehicles. Coverage only available in state of Alaska.

Collision Full Glass
No deductible for glass damage resulting from a collision. Deductible applies to all other damage.

Collision Liability Buy Back
Available in Michigan, this coverage will pay the $500 that a Michigan resident is responsible for if they damage the property of another in an at fault accident.

Collision Waiver Deduction
Collision deductible would be waived ONLY if vehicle is damaged by an AT-FAULT uninsured motorist. Requires CL and UMBI. Coverage only available in state of California

Combined Ratio
Basically, a measure of the relationship between dollars spent for claims and expenses and premium dollars taken in; more specifically, the sum of the ratio of losses incurred to premiums earned and the ratio of commissions and expenses incurred to premiums written. A ratio above 100 means that for every premium dollar taken in, more than a dollar went for losses, expenses, and commissions.

Combined Single Limit
Liability limits that specify a single dollar amount for combined Bodily Injury and Property damage, without showing specific limits for each indiviudal coverage. For instance the combined single limit for the policy is $100,000. The individual coverages are not given specific limits and limited only by the aggregate amount of coverage.

Commercial Auto Insurance
Provides coverage to a business for losses that arise out of vehicles which are owned or used by the business.

Commercial General Liability Policy
Commercial liability policy drafted by the Insurance Services Office containing two coverage forms-an occurrence form and a claims-made form.

Commercial Lines
A general term for any type of insurance (property, casualty, health, life, etc.) purchased by businesses, organizations, institutions, governmental agencies or other commercial establishments to protect risks associated with their operations.

Commission
The part of an insurance premium paid by the insurer to an agent or broker for his services in procuring and servicing the insurance.

Commissioner
A state officer who administers the state's insurance laws and regulations. In some states, this regulator is called the director or superintendent of insurance.

Comparative Negligence
Under this concept a plaintiff (the person bringing suit) may recover damages even though there is contributory negligence. His or her recovery, however, is reduced by the amount or percent of that negligence.

Comprehensive
Loss caused by factors other than collision: ex. Missiles or falling objects; fire; theft or larceny; explosion or earthquake; windstorm; hail; water or flood; malicious mischief or vandalism; riot or civil commotion; contact with a bird or animal; or breakage of glass.

Comprehensive Full Glass
Comprehensive with no deductible for glass damage only. Deductible does apply to other comprehensive losses. In FL, CPG applies to windshield ONLY. Coverage not available in every state.

Comprehensive Personal Liability Insurance
Protection against loss arising out of legal liability to pay money for damage or injury to others for which the insured is responsible. It does not include automobile or business operation liabilities. Refers to the general liability (not auto related) exposures that accompany a person's non-business activities. For example, your dog bites someone or you hit someone with a golf ball. This coverage is generally available to our Fulltimers as a form of coverage to replace their Homeowner's Liability that they lose when they sell their house and RV Fulltime.

Comprehensive Rental Vehicle
Comprehensive coverage, which may be purchased on a liability-only policy to cover rented vehicles. Available only in AK.

Compulsory Auto Liability Insurance
Insurance laws in some states require motorists to carry at least certain minimum auto coverages.

Concealment
Deliberate failure of an applicant for insurance to reveal a material fact to the insurer.

Concurrent Causation
Legal doctrine that states when a property loss is due to two causes, one that is excluded and one that is covered, the policy provides coverage.

Consideration
One of the elements for a binding contract. Consideration is acceptance by the insurance company of the payment of the premium and the statement made by the prospective policyholder in the application.

Consumer Report
A variety of information about the consumer including, prior loss reports (PLR), motor vehicle reports (MVR), and credit score.

Contract
A binding agreement between two or more parties for the doing or not doing of certain things. A contract of insurance is embodied in a written document called the policy.

Contractual Liability
Legal liability of another party that the business firm agrees to assume by a written or oral contract to a declared limit.

Contribution by Equal Shares
Type of other-insurance provision often found in liability insurance contracts that requires each company to share equally in the loss until the share of each insurer equals the lowest limit of liability under any policy or until the full amount of loss is paid.

Contributory Negligence
Any negligence on the part of the plaintiff which contributed to the cause of the accident may bar the plaintiff from recovery against a negligent defendant, even if the defendant was more negligent than the plaintiff.

Coverage
The scope of protection provided under a contract of insurance; any of several risks covered by a policy.

Credit Score
A number that is obtained from a credit bureau vendor. The number, which is also referred to as a score is the result of applying the consumers credit file information against a standard insurance industry model. The score does not enable anyone to determine specifically what information was in the consumer's credit file.

Insurance Information (cont'd)
Rate
The pricing factor upon which the insurance buyer's premium is based.

Rated Policy
Sometimes called an "extra-risk" policy, an insurance policy issued at a higher-than-standard premium rate to cover the extra risk where, for example, an insured has impaired health or a hazardous occupation.

Ratemaking
The statistical process by which insurers determine risks and pricing for the basic classes of insurance.

Rating Territory
A geographical grouping in which like hazards tend to equalize and permit the establishment of an equitable rate for the territory.

Reasonable and Customary Charge
A charge for health care, which is consistent with the going rate or charge in a certain geographical area for identical or similar services.

Rebating
Giving any valuable consideration, usually all or part of the commission, to the prospect or insured as an inducement to buy or renew. Rebating is prohibited by law.

Recurring Claim Provision
A provision in some health insurance policies which specifies a length of time during which the recurrence of a condition is considered to be a continuation of a previous period of disability or hospital confinement.

Recurring Clause
A provision in some health insurance policies, which specifies a period of time during which the recurrence of a condition is considered a continuation of a prior period of disability or hospital confinement.

Reduced Paid-up Insurance
A form of insurance available as a nonforfeiture option. It provides for continuation of the original insurance plan, but for a reduced amount.

Regulation
Supervision of business practices by a governmental entity.

Rehabilitation
(1) Restoration of a totally disabled person to a meaningful occupation, (2) a provision in some long- term disability policies that provides for continuation of benefits or other financial assistance while a totally disabled insured is retraining or attempting to resume productive employment.

Reimbursement
The payment of the expenses actually incurred as a result of an accident or sickness, but not to exceed any amount specified in the policy.

Reinstatement
The resumption of coverage under a policy which has lapsed.

Reinsurance
Assumption by one insurance company of all or part of a risk undertaken by another insurance company.

Reinsurance Facility
An alternative mechanism to service those insureds that cannot obtain insurance in the voluntary market. Premiums and losses for the business that is ceded to the facility are pooled and all insurers share according to their proportion of the voluntary market.

Renewable Term Insurance
Term insurance which can be renewed at the end of the term, at the option of the policyholder and without evidence of insurability, for a limited number of successive terms. The rates increase at each renewal as the age of the insured increases.

Renewal
Continuance of coverage under a policy beyond its original term by the insurer's acceptance of the premium for a new policy term.

Renter's Policy
A package type of insurance that includes coverage similar to a homeowners policy to cover the personal property of a renter or tenant in a building.

Replacement
The substitution of health insurance coverage from one policy contract to another.

Replacement Cost
The cost to repair or replace property at construction costs prevailing at time of loss; the cost to repair or rebuild property without considering depreciation. (See Actual Cash Value)

Replacement ratio
The percentage of income before retirement that is required to be replaced to maintain the same standard of living after retirement.

Representation
Statements made by an applicant in the application, which he represents as being substantially true to the best of his knowledge and belief, but which are not warranted as exact in every detail.

Rescission
Termination of an insurance contract by the insurer on the grounds of material misstatement on the application for insurance. The action of rescission must take place within the contestable period or Time Limit on Certain Defenses but takes effect as of the date of issue of the policy, thus voiding the contract from its inception.

Reservation of Rights
An arrangement whereby an insurer defends a case without commitment to provide coverage in the event that the facts disclosed during the trial reveal that the occurrence is not covered.

Reserve
(1) An amount representing liabilities kept by an insurer to provide for future commitments under policies outstanding. (2) An amount allocated for a special purpose. Note that a reserve is usually a liability and not an extra fund.

Residual Disability
A period of partial disability that immediately follows a period of total disability. Benefits for residual disability are paid on a pro-rata basis, depending on the percentage of earnings loss.

Residual Disability Benefits
A provision in an insurance policy that provides benefits in proportion to a reduction of earnings as a result of disability, as opposed to the inability to work full-time.

Residual Market
A system through which insurance is made available to buyers that represent unusually high risks.

Retention
The net amount of risk retained by an insurance company for its own account or that of specified others, and not reinsured.

Retrocession
The process by which a reinsurer obtains reinsurance from another company.

Retrospective Date
The first date for which claims will be paid under a claims-made policy of liability insurance.

Retrospective Rating
Rating procedure which allows adjustment of an insured's final rate on the basis of the insured's own loss experience.

Revocable Trust
A trust that can be terminated or revoked by its creator.

Rider
A special policy provision or group of provisions that may be added to a policy to expand or limit the benefits otherwise payable.

Right of Survivorship
At the death of one co-owner of property, that person's interest in the property automatically passes to the surviving joint tenant or tenants.

Risk
The chance of loss. Also used to refer to the insured or to property covered by a policy. A term used to refer to a person or the peril insured.

Risk Classification
The process by which a company decides how its premium rates for life insurance should differ according to the risk characteristics of individuals insured (e.g., age, occupation, sex, state of health) and then applies the resulting rules to individual applications. (See - Underwriting)

Risk Control
Any conscious action (or decision not to act) intended to reduce the frequency, severity, or unpredictability of accidental losses.

Risk Retention Group
An alternative form of insurance in which members of a similar profession or business band together to self insure their risks.

Robbery
The taking of property from a person by force or threat of violence.

Rollover
Transfer of IRA or other qualified pension funds from one financial institution (trustee) to another.