Car insurance acts as a safety measure which provides financial protection in case of an accident. It’s a contract between an individual and the insurance company that protects you against any kind of financial loss caused due to an accident or theft. With an insurance policy, instead of paying a premium by yourself, the insurance company agrees to pay for your losses as outlined in your policy.

With an increasing number of car accidents in recent times and a rise in the usage of vehicles, it becomes difficult to take the safety of your car for granted.

Following are a few important terms related to car insurance.

• Bodily injury coverage clause: Many people misunderstand this clause thinking that it’s for their injury, and in case of an accident, it will cover their medical bills. This is completely false as this clause covers not your medical bills but the costs that you will incur if your car accident harmed another person which can be anyone: a driver, a passenger or even a pedestrian.
• Comprehensive coverage clause : This is related to the damages caused to your car due to non-collision events like when your car gets damaged due to weather conditions.
• Personal Injury Protection (PIP): A very common misunderstanding related to car insurance where you or any passenger in your vehicle is paid the medical insurance. People often misunderstood it to be related to the damage caused by cars or any property.
• Always getting a courtesy car in case of an accident: While this is true in some cases, there are certain exceptions to the rule. In case your car gets stolen or damaged, it’s not necessary that you’ll be offered a courtesy car unless it’s mentioned in your policy.
• Deductible clause: It’s the amount that you have to pay for any car insurance claim before your insurance company pays the claim for you. The higher your deductible amount, the lower is your premium. People often are not aware of it.

These were some of the crucial terms related to car insurance. It’s good if people know about their insurance policies in detail before they go out and buy car insurance for their cars as in the end, it’s for yours and your family’s safety.