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An
Auto Insurance Policy
The policy
you receive from an auto insurance company will have several parts.
- The declarations/information
page includes the policy number, the effective dates, the details
of the cars covered on the policy, the lienholder (if you have a loan
on the car), the coverages, coverage limits, your premium, risk
classifications and any discounts or surcharges. It is also going to
list where the car is garaged and contact details for your company and
agent, if you have one. The coverage names, limits and descriptions
will vary depending on the state.
- The personal
auto policy or policy form. This will be several pages long and
will detail in specific language what is covered, how those coverages
are defined, the conditions of the policy and if there are any
exclusions. This may also include state exception pages that
revise/change/modify the policy form. Some companies customize their
policy forms to match the coverages in a specific policy, while others
list all available coverages. Your declarations/information page
details which coverages were purchased.
- At least one
copy of an insurance card should be included as proof of
coverage. Keep this in the car.
What
to Look for on a Declarations or Information Page
Go here
to see
an example declarations/information page.
- Personal Information –
Verify the address listed on the policy is correct. Parking your car in
a
garage, or even parking it off the street can mean lower premiums.
Notify your
agent if there has been parking changes since the policy was written.
- Year, Make, Model,
Vehicle Identification Number (VIN) – How much you pay is
heavily based on the car you drive so make sure this information is
accurate.
If your declarations or information page is wrong, it could also cause
problems
if you file a claim. Do not get caught by increases when trading in
your car.
Call your agent for a quote before you buy.
- Lienholder
Information – If you obtained a loan to purchase your car,
the
lienholder will likely require that it be listed on the policy. If you
have
paid off the loan, call your agent to have the lienholder removed. Your
agent
or insurance company may ask for a copy of the new title (without the
lienholder listed) or other proof you paid off the loan.
- Coverages
– For an overview of your coverage choices go to InsureUonline.org
and click
on your life situation. The auto tab includes explanations of the
different
coverages and some tips on evaluating your auto insurance needs. You
can also
download the NAIC Consumer's Guide to Auto Insurance here.
- Collision
– The higher your deductible, the lower your premium. However,
since this is
the amount you have to pay if the car is damaged in an accident, make
sure you
will be comfortable paying the amount.
- Comprehensive
– This is sometimes referred to as "Other Than Collision"
coverage.
It is possible that removing the comprehensive and/or collision
coverage from a
policy could save some money. Before you decide to cancel comprehensive
coverage weigh the value of the car and the cost to replace or repair
it
against what you would save in premium costs.
- Premium
– The amount of premium you are charged generally depends on a
number of
factors. You can find out more about the factors your company may use
to
determine your premium here.
If you
have questions about how your insurer determines your rates and what
steps you
can take to improve your risk profile, contact your insurance agent or
insurer.
- Discounts
– When looking at your declarations or information page, you may
see discounts
listed at the bottom of the page. Typically, the company has included
any
discounts in the premium amount listed. Check the list of discounts to
see what
was included in your overall premium. Check here
for a
list of discounts typically available. If you think you are eligible
for a
discount you are not receiving, review with your insurance agent or
insurer.
- Agent Contact Details
– If you have an agent, their name and contact information will
likely be
listed on your policy. You can always contact your insurance company
directly
if you have any questions.
Other
Things to Know About Your Auto Insurance
When it
comes to the premium you pay for auto insurance, you should also check.
- Drivers
– The individuals listed as drivers on your policy may or may not
be listed on the declarations or information page, but these people can
make a big difference in how much you are paying for insurance. The
driver considered the highest risk by your insurance company will
generally be used to figure your household premium. Review who is
listed as the principal driver on each vehicle to ensure you are
correctly rated.
- Driving
record – A speeding ticket or an accident can increase your
premium from term to term. However, after a period of time those
violations will fall off your record. It is a good idea to know what is
on your driving record and how long it might affect your premium. Talk
with your agent if you have a ticket or accident that is several years
old.
- Claims
history – When you apply for a policy or when a current
policy is renewed, it is normal for an insurance company to check the
driver's claims history. For new customers, companies often run a
Comprehensive Loss Underwriting Exchange (C.L.U.E.), Colossus, or
similar report. This information is used to help determine the cost of
insuring your vehicle. Ask your agent or insurance company how long
claims will adversely affect your premium.
- Credit
history – In some states, a credit-based insurance score can
be used as a factor to determine your premium. It is a good idea to
check your credit report occasionally to ensure the information is
correct. If there is incorrect information, check with the credit
reporting company about how to amend it and then ask for a review of
your premium.
More Information
If you have questions or are confused about
your insurance
coverage,
contact the Arkansas Insurance Department Consumer Services Division
at (800) 852-5494 or (501) 371-2640.
Get smart about your insurance needs! More
information about
auto, home, life and health insurance options — as well as tips
for choosing the coverage that is right for you and your family —
is located on the NAIC Web site, www.InsureUonline.org.
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