Automobile Insurance Terms

The following are some insurance policy terms and their consequences to consider:

First Party Benefits” – Available options including wage loss, medical expenses, death benefits and funeral benefits that your insurance company will pay you up to the amounts you select.

Full Tort” – The opposite of limited tort.  You pay a higher premium and reserve your right to receive money for pain and suffering.

“Lien” – The amount Medicare or a health insurance company is entitled to recover from your settlement or award in a personal injury case for the medical benefits paid on your behalf.

Limited Tort” – In exchange for a lower premium, you give up the right to recover damages for pain and suffering for all but serious injuries.

Stacking” – This option allows you to multiply or “stack” your coverages by the number of automobiles insured on the policy.

Uninsured Motorists” – With this option, your insurance company pays you up to the policy limits if you are injured in an accident with someone who does not have insurance.

Underinsured Motorists” – With this option, your insurance company pays you up to the policy limits if you are injured in an accident with someone whose policy limits are not high enough to cover the full value of your injury.

Like any other product, an insurance policy functions best when the consumer has made an informed choice and has maximized his or her coverage for the premium dollars available to spend.  The worst time to find out you do not have sufficient coverage is after an accident occurs.