Accident:  Also known as a collision, an accident is an unfortunate event that causes damage to your own or another vehicle or person.

Accident Forgiveness:  An increasingly common component of many automotive insurance policies, allowing drivers who have good records to be “forgiven” the first time they are at-fault in an accident.  With accident forgiveness, your rates will not be increased for a first offense.

Agent:  A person who sells insurance and earns a commission from his or her sales.  Some agents work for multiple companies while others represent only one company.

Claims Adjuster:  A person who looks into an insurance claim and settles it.

Deductible:  The amount an insured person must pay before the insurance company takes over.  Setting a higher deductible is one way to save money on your car insurance.

Defensive Driver Discount:  A reduction in fees given to motorists who have taken and passed a course in defensive driving.

Endorsement:  A document used to modify an insurance policy.

Gap Insurance:  Recommended for leased and loaned vehicles, gap insurance covers the difference between the reimbursement a motorist would receive from comprehensive or collision insurance and the actual cost to replace the vehicle.  

Good Student Discount:  For student drivers, a discount applied to the policy for maintaining a B average or better at school.

Liability Insurance:  Required by law in order to register a vehicle, liability insurance pays to reimburse other drivers for medical costs and the replacement of property lost in an accident.

Material Damage:  Damage to one’s property covered by an insurance policy, including property covered by a comprehensive policy, rental reimbursement, fire, theft, or uninsured motorist.

Motor Vehicle Record:  A record of a driver’s history kept on file with a state’s division of motor vehicles.  This record lists any accidents, speeding tickets, DWIs or other driving offenses and is used to calculate the cost of a driver’s insurance policy.

Original Equipment Manufacturer Parts:  Parts for a vehicle that have been produced by the vehicle’s original manufacturer.  

Personal Injury Protection:  An automotive insurance policy that reimburses the policy-holder for things like medical expenses, lost wages, and other financial burdens caused by an accident, whether or not the policy-holder was at fault in the accident.

Policy Term:  Usually annual or semi-annual, the policy term is the period of time for which it is effective.

Preferred Risk:  A better-than-standard risk based on the terms used to calculate the cost of an automotive insurance policy.

Primary Use:  The reason the insured vehicle is most commonly used.

Quote:  A written indication of the cost of an insurance policy, its terms and limitations based on the information given by the driver requesting the quote.

Rating Plan:  The comprehensive set of rules used by an insurance company to calculate how much a person must pay for auto insurance.  

Rental Reimbursement:  An add-on to an insurance policy that covers the cost of a rental car if the insured vehicle is damaged or otherwise out of commission because of an accident.  

Surcharge:  An extra charge, usually incurred when a driver gets a speeding ticket or other moving violation.

Tort:  An intentional or unintentional damage done to other person, resulting in a lawsuit.

Umbrella Insurance:  Increases your liability insurance with higher limits of liability and offers additional protection from lawsuits and financial damages if you are at fault in a serious accident.  

Underinsured:  A motorist who is not carrying enough insurance to cover the damages he or she caused.

Waiver of Collision Deductible:  An option that removes your deductible if your vehicle is damaged in a collision with an uninsured motorist or a motorist in a hit-and-run.  You must be able to identify the vehicle