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Understanding Your Car Insurance Policy’s Terminology

It is important for drivers to understand the terminology that is in their car insurance policy. It can be confusing to learn all of the terms so let us explain several of them so that you can get a firm grip on how to handle your policy.

The first term is surcharge. Many people incur surcharges and are unsure of why they have occurred. Basically, a surcharge is an increase in your insurance premiums. It happens because of an infraction such as getting a traffic ticket or causing a car accident. You can try to appeal a surcharge if you feel that you received it when you should not have.

The second term is step down. Some car insurance companies have something called step down provisions. These are provisions that are in some policies in which if someone who is not listed on your car insurance policy gets into an accident then your liability insurance coverage will get dropped down to the state’s minimum provisions.

This can end up costing drivers a lot of money if they let someone use their vehicle when they should not have and they wind up causing an accident. It is important to know in advance if your car insurance policy has this type of provision in it.

The third term is emergency responder fee. Some cities and towns allow emergency responders to charge a fee for their services. For example, if you are in a car accident and an ambulance came to help you then they could bill you a few thousand dollars for their services.

This fee could end up being yours to pay if you have liability only insurance or have a deductible. It is important to know if your car insurance company will cover these fees so check with them in advance.

The final term is SR-22. A SR-22 is a form that drivers must get if they have are high risk driver. These are typically for people who have been arrested for DUI’s or who have been caught being uninsured or those who have caused accidents. The form basically says that they will take responsibility for being insured at all times.

When a person must get a SR-22 they have to stay insured or they will potentially lose their driving privileges. If you have been told that you have to get a SR-22 then contact your car insurance company immediately. It pays to read your insurance policy carefully. You never want to be caught off guard if an accident happens so read your policy today and speak to an agent if you have any concerns.