Understanding Common Auto Insurance Terms

Buying auto insurance can be an extremely challenging task. Apart from sorting through numerous insurance providers, you will also have to deal with car-related legalese that can confuse you. As auto insurance will be the thing that protects your precious car in the long term, it is crucial that you understand these terms before you decide on what and who to purchase from. Read on to learn and understand the common auto insurance terms.


This is the amount that you will have to pay out of pocket when making a claim before the insurance kicks in. The higher your deductible, the lower your premium will be.

Declarations Page

Basically, this is the summary of your coverage. The details included are the coverage you have, the limits and costs of the coverage, and which vehicle is being covered.

Liability Coverage

You are required to have this as mandatory minimum insurance in most states. It pays for the damages and injuries done to the other party in the cases that you are at fault. There are two types of liability coverage. The obvious one is property damage liability which pays for any damage caused to property, such as a car, fence, or mailbox. Bodily injury liability covers the injuries or death caused by you. Other than medical expenses, it extends its legal fees, lost income, and “pain and suffering”.

Collision Coverage

This is the basic coverage for your car if you collide into something. Whether you are responsible or not, damages to your vehicle will be covered by this. This is worth it if your car is new or valuable.

Comprehensive Coverage

If you are worried about damages to the car that is caused by anything other than collisions, comprehensive coverage is what you are looking for. It covers a variety of situations including hitting wildlife, theft, vandalism, and natural disasters.

Personal Injury Protection

Also known as medical payments or no-fault coverage, this is required in no-fault states. Like bodily injury liability, it covers medical expenses, lost wages, and funeral costs but for yourself and your passengers instead.

Gap Insurance

This is important for those leasing or making payments on their cars. It covers the gap between the value of the vehicle and what you owe on the car. With gap insurance, you won’t have to continue paying for the car if it is totaled in a crash.

Full Coverage

Some insurance companies might say they provide full coverage, but it is not a proper insurance term. It implies that it includes more than just liability coverage, but as for what else is also covered, you will have to properly look through the details of their policy.

Get Insurance With K&N Brokerage

Now that you know what all these auto insurance terms mean, you are ready to get a policy. Why not try out K&N Brokerage? We are transparent and clear about what our policies cover. By having a consultation with our car insurance specialists, you will be recommended the most suitable insurance according to your background, needs, and driving history. We also offer competitive rates that are good value for money. We at K&N Brokerage will ensure that your car is protected.