Understanding the Sections of Your Insurance Policy

Understanding the Sections of Your Insurance Policy

Are you scratching your head and rubbing your chin in bewilderment every time you look at your insurance policy?  If so, it might help you make better sense of your policy if you have a better understanding of the different sections that are included in automobile policies.  These include:

•    Declarations
•    Insuring agreement
•    Definitions
•    Exclusions
•    Conditions

The declarations section of your policy is meant to provide you with all of the basic details about your policy and the vehicle that is covered.  This section is generally only one page long and includes information such as the year, make and model of the vehicle that is covered as well as its VIN.  The declarations section also includes the name of any drivers in the household, the effective dates of the policy, the premium amount, and the coverage types and limits.  The use of your vehicle, such as whether it is for pleasure or business, as well as the anticipated number of miles you drive each year are also included in the declarations section.

The insuring agreement outlines what the insurance company will give you in exchange for the premium payments you make.  This section can be a little confusing, as it goes into great detail regarding what is covered by your policy.  Luckily, the definitions section helps to clear up the confusion a little.  Here, you can learn the meaning behind all of the insurance lingo you will come across in the insuring agreement section.

Another section of the policy is the exclusion section.  In this section, you can read about the things that are not covered by your policy.  For example, your policy may not provide coverage for damage caused by flooding. Be certain to read this section carefully so you are clear on the types of things that your policy does not cover.

The final section in your insurance policy is the conditions section.  This section details the conditions that must be met in order for your policy to remain active.  For example, you will need to make your premium payments on time in order to keep the policy in place.  Other conditions of coverage may also be described year, as well as instructions for properly filing a claim if you are involved in an accident.

Although reading an insurance policy can be confusing, it is important for you to read your policy carefully and to be clear on the precise coverage you are receiving.  That way, there will be no surprises when an accident occurs.

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