In order to make sense of insurance, you need to know some basic terms. Sadly, no one discusses these terms with anyone. Ever. Seriously, I did not know what these meant until I went to work for the insurance industry. These terms are important in homeowners insurance, car insurance, business insurance, dealing with an insurance claim, or any other insurance related matter. I know lawyers who don’t know what this stuff means. So, here are 5 more insurance terms YOU MUST KNOW:
6. LIABILITY COVERAGE
The coverage provided by your insurance company to protect you if you are sued by another person and protect your assets if a claim is filed against you. Car insurance and homeowners insurance policies have liability coverage.
The amount of money you pay to your insurance company in exchange for them agreeing to pay you when you file a first party claim or defend you when someone files a claim against your liability insurance policy.
8. UNINSURED MOTORIST COVERAGE
A special first party coverage that will pay you for damage caused by another person when the other person does not have insurance or when the other person does not have auto liability limits that are the same as yours. If you are in an accident with someone who has no insurance, your uninsured motorist coverage pays for your damages.
9. SPECIAL INVESTIGATIONS UNIT (“SIU”)
A special department of the insurance company claims department that investigates questionable or fraudulent claims. The SIU adjusters are usually retired police officers. They use private investigators to conduct sub rosa, also known as surveillance, on people who have filed claims that the insurance company thinks are fraudulent.
10. MINIMUM LIMITS POLICY
A policy that provides the bare minimum amount of insurance required by law. In California, a minimum limits policy is called a 15/30 policy because the insurance company will pay $15,000 per person and $30,000 per accident for injuries sustained as a result of a car crash.