Aftermarket Part - After-market parts are made by a company other than the manufacturer of the vehicle.

Actual Cash Value- An amount equivalent to the fair market value of the stolen or damaged property immediately preceding the loss. For real property, this amount can be based on a determination of the fair market value of the property before and after the loss. For vehicles, this amount can be determined by local area private party sales and dealer quotations for comparable vehicles.

Admitted Company - An insurance company authorized to do business in California.

Agent - A licensed person or organization authorized to sell insurance by or on behalf of an insurance company.

Auto Insurance - Coverage on the risks associated with driving or owning an automobile. It can include collision, liability, comprehensive, medical, and uninsured motorist coverages.

Binder - A temporary or preliminary agreement which provides coverage until a policy can be written or delivered.

Bodily Injury - Bodily harm, sickness or disease, including death. This does not include communicable diseases such as HIV/AIDS.

Broker - A licensed person or organization paid by you to look for insurance on your behalf.

Cancellation - The termination of insurance coverage during the policy period. Flat cancellation is the cancellation of a policy as of its effective date, without any premium charge.

Claim - Notice to an insurer that under the terms of a policy, a loss maybe covered.

Claimant - The first or third party. That is any person who asserts right of recovery.

Collision Coverage - Coverage that insures against damage to your vehicle as a result of hitting another vehicle or object (i.e. a tree).

Comprehensive Coverage - Coverage that insures against damage to your vehicle as a result of a loss caused by something other than collision. Some examples are theft, fire, vandalism or falling objects. This coverage is sometimes referred to as "Other-than-Collision".

Coverage - The scope of the protection provided in your insurance contract, as well as any of several risks covered by a policy.

Declaration - The part of your written policy (contract) that includes your name and address, the property that is being insured, its location and description, the policy period, the amount of insurance coverage and the applicable premiums.

Decline - The company refuses to accept the request for insurance coverage.

Deductible - The portion of a claim you pay out of pocket before the insurance company pays. A higher deductible will lower your premium and you do not have to carry the same deductible for comprehensive and collision coverages.

Depreciation - A decrease in value due to age, wear and tear, etc.

Endorsement - Any change made to a policy.

Exclusion - A restriction in your insurance policy that denies coverage for certain perils, persons, property or locations.

Expiration Date - The date on which the policy ends.

Grace Period - A period (usually 31 days) after the premium due date, during which an overdue premium may be paid without penalty. The policy remains in force throughout this period.

Insured - The person or organization covered by an insurance policy.

Insurer - The insurance company.

Liability Coverage - Coverage that insures against damages (to other party) for bodily injury or property damage when you are legally responsible for an auto accident.

Limits of Liability - The specified amount up to which the insurance company will protect you as set forth in the policy.

Loss experience - The types and amounts of claims that you have previously had.

Material Misrepresentation - The policyholder / applicant makes a false statement of any material (important) fact on his/her application. For instance, the policyholder provides false information regarding the location where the vehicle is garaged.

Medical Payment Coverage - Coverage that pays for minor medical expenses (to you or your passengers) resulting from an accident, regardless of fault.

No-fault Insurance - An insurance system where your insurance coverage pays for your injuries regardless of who caused the accident.

Policy - A contract between you and the insurance company.

Premium - The price of the insurance policy.

Premium Financing - A policyholder contracts with a lender to pay the insurance premium on his/her behalf. The policyholder agrees to repay the lender for the cost of the premium, plus interest and fees.

Property Damage - Physical injury to, destruction of or loss of use of tangible property (of other party).

Quote - A cost estimate for insurance coverages based on specific information, including drivers, vehicles and driving record.

Rate - The amount you pay as premium.

Replacement Cost - The cost to repair or replace an insured item. Some insurance only pays the actual cash or market value of the item at the time of the loss, not what it would cost to fix or replace it. If you have personal property replacement cost coverage, your insurance will pay the full cost to repair an item or buy a new one once the repairs or purchases have been made.

Replacement Value - The full cost to repair or replace the damaged property with no deduction for depreciation, subject to policy limits and contract provisions.

Rider - Usually known as an endorsement, a rider is an amendment to the policy used to add or delete coverage.

Risk - The chance of loss.

Subrogation - The process of payment recovery whereby your insurance company settles the claim for damage to your car and seeks payment recovery (including your deductible) from the other party if your car is damaged because of that party's negligence.

Surcharge - An extra charge applied by the insurer. For automobile insurance, a surcharge is usually for accidents or moving violations.

Underwriting - The process of determining risk and in what amounts and on what terms the insurance company will accept the risk.

Uninsured/Underinsured Motorist Coverage - Coverage that insures against damages (to you or your passengers) for bodily injury when the responsible party has no insurance or insufficient insurance to pay for damages. This coverage includes hit-and-run accidents.