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Glossary Terms

Additional Drivers
Additional Drivers recorded on a motor insurance policy. This means drivers other than you,. (e.g. your husband or wife).

Agent
Someone acting on behalf of another. Insurance company salespeople can be known as agents

Any driver
Insurance that allows anyone to drive a vehicle with permission of the owner.

Approved Repairer
A team of repairers, usually throughout the whole country recommended by the insurance company to repair your car.

Cancellation Clause
A provision in an insurance contract that permits the Insurer or the insured to cancel a policy at any time before its expiration date.

Debit Transaction
A payment transaction originated by a Biller, which as been authorised by the Customer, to withdraw funds from the Customer's account.

Claim
The term used to describe the process of getting an insurance company to pay out on your policy.

Claims Procedure
The procedure to go through when making a claim.

Credit Card Payments
Payments made using a credit card such as MasterCard.

Comprehensive Cover
This includes third party and third party fire and theft cover described below, as well as loss of or damage to your vehicle caused by accidental or malicious damage and generally includes some personal accident benefit in respect of personal injury to you or your death (please refer to your policy terms when received). Theft cover for the contents of your car is provided by most Insurers but only to a specified amount and subject to policy terms. Details will be shown with your quotation.

Cover
The protection offered by your insurance policy. Examples on a motor insurance policy would be Comprehensive or Third party fire and theft.

Cover Notes
A temporary document stating that an insurance policy is in force.

Convictions
Convictions subject to the Rehabilitation of Offenders Act (ROOA) have to be declared to the Insurer otherwise your policy cover could be voided. Any criminal convictions, including motoring convictions, fixed penalties and pending convictions have to be declared. Watch out for the ROOA, as some convictions have to be declared for up to 12 years. If in doubt declare the facts - your Insurer will ignore it if it doesn't apply because they have to by law.

Credit Card Payments
Payments made using a credit card such as MasterCard or Visa.

Debit Card Payments
Payments made using a debit card such as Switch or Delta.

Direct Debits
Payments made using a Direct Debit system where regular payments are automatically taken from your bank account.

Discounts
A discount is a reduction from the base rate due to a reduction in a risk factor. An example of this would be a security discount if you had a recognised alarm system.

Effective date
The date on which the insurance under a policy begins.

Excess
The sum of money you have to pay towards the first part of an insurance claim. This amount is specified in the schedule forming part of your insurance policy.

Fault Claim
A fault claim is one where your insurance company is not able to recover all of the cost from another party.

Foreign Use
On a motor insurance policy this refers to when the vehicle is used abroad. But not all Insurers cover you whilst abroad. Even if your insurance certificate states that it covers you in the EC you may need to check. Sometimes the cover only meets the minimum legal requirements of the country you are visiting. You will still need to tell your Insurer to extend the Comprehensive accidental damage cover on your car for the time you are abroad.

Insured
You become the Insured (the person in whose name the policy is in) once you have started the policy cover. Before the cover started you was the Proposer.

Insurers
Insurers are the companies who take the financial risk when you buy a policy and have to "pay out" in the event of a valid claim; once they have received your premiums. They are regulated by the Association of British Insurers and the DTA.

Insurance Premium Tax (IPT)
A Government tax that is charged as a percentage of insurance premiums.

Modified Vehicles
All changes to a vehicle are considered to be modifications. This includes things like replacement alloy wheels, wheelchairs etc, as well as the more obvious changes such as engine performance. Always declare the modifications in advance of buying your policy or declare to your Insurer before going ahead. The modifications may not always attract a loading in premium but failure to declare them could result in the policy being voided and you not receiving a full settlement of your claim.

No Claims Bonus
A bonus or reward, by way of a discount on premiums, given to insurance policyholders who haven't made a claim under the policy for a specified length of time or have a protected no-claims policy. Commonly offered in motor insurance policies.

Physical Disabilities
You may be required to declare to your insurance any disabilities or medical conditions.

Policy
This legally binding document, which is the evidence of the cover. You should be able to examine all the policy wordings. You should check your policy carefully when you receive it and if any amendments are required you must notify your Insurer before it is too late.

Premium
This is the amount that you will pay which goes to your Insurer for the cover purchased. There may be additional costs such as legal expenses, specialist additional products and administration charges, all of which should be clearly highlighted.

Premium Finance
Premium finance is a financing option for annual policies. That is, should a customer wish to take an Annual policy then they can pay the premium amount (less deposit) in monthly installments over the term of the policy.

Proposer
The person taking out the insurance. A policy is a legal contract between the Proposer and the Insurer. You are a Proposer before the policy starts. Once it starts you become the Insured.

Statement of Fact
The Statement of Fact is the basis of the contract. It is probably the most important aspect of the cover process. This may be in written hard copy form or may be taken from the entered details on the system. As insurance is an intangible product whose price is based on the information provided by you then any errors or non-disclosure of material facts can result in the policy being voided. Check with your insurance company if you have any difficulties or need advice. Also, if you know of something, which the Insurer ought to know, but the document doesn't display that question, do not think that you do not have to tell them. You have a legal duty to disclose all facts.

Third Party
A policy is a legal contract to which you are the first party and the Insurer is the second party. Any other person with whom you have been involved in an accident is generally referred to as the Third Party.

Third Party Fire and Theft Cover
On a motor insurance policy this covers you for your legal liability to third parties (including damage to their car or compensation to them for injuries sustained if the accident was your fault). In addition the cover extends to fire damage to your vehicle or any damage arising out of the theft or attempted theft of your vehicle. Please note that usually the theft of the contents of your vehicle is not covered under this type of cover unless the entire vehicle and its contents have been removed. Even then there can be some limitations within the policy, so please check.

Third Party Only Cover
On a motor insurance policy this covers you for your legal liability to third parties (including damage to their car or compensation to them for injuries sustained if the accident was your fault). It also covers passenger liability but there is no cover for damage to your car from any cause whatsoever. This complies with the minimum legal requirements of the Road Traffic Act but very little more.

Vehicle Details
The information describing exactly which vehicle you own (e.g. the make, model and engine size etc).

Voluntary Excess
This is a voluntary amount deducted from any claim settlement and represents your contribution to the claim cost and is in addition to any Compulsory Excess. If you have an excess of £400 and your claim is for £1000, then you will only receive £600 from your Insurer. If the accident (in the event of a motor claim) was not your fault then you may be able to recover this from the person to blame (third party) or their Insurers.

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