Understanding the Vehicle Insurance Policy

After you have shopped around for vehicle insurance quotes and decided what type of coverage you need and the company in which you would like to make the investment , it is important to understand your policy, what you are paying for, and how it can work for you. Make sure that your conversations with your insurance agent were documented, so that once you receive your policy, you can review the terms of the agreement and verify that what you discussed has been included in your insurance policy. Ultimately, your insurance policy is the legally binding document that states what the insurance company is responsible for. If a certain provision, time frame, or dollar amount is not stated in this document, the insurance company will not be liable should you file an insurance claim. If you are unsure about the language written in your insurance policy or if a stated agreement has not been included in your contract, you should call your insurance agent immediately to discuss.

Once you have entered into the contract, most companies will allow policyholders to review their policy for a period of 10-30 days and cancel and receive a refund on the new insurance if they are not completely satisfied with the terms of the agreement. Policyholders should keep a record of all of their receipts and checks if they decide to cancel the policy. In its most basic terms, the vehicle insurance policy will state the terms and length of the contract (for example, one year or six months), effective dates, premium amounts, and deductibles, if applicable. The policy will identify the insured’s name and the make and model of the motor vehicle being insured. Then, because each state requires a minimum amount of required liability insurance, each policy will identify the agreed upon amount. If additional coverage was purchased, the terms of this agreement would be included in the contract as well.