Car Insurance Glossary

Actual Cash Value

This is a monetary amount that is equivalent to the market value of a stolen or damaged item before the damage occurs. For anything that is not a car, the current going rate of the market for the item before it is damaged determines the amount. For automobiles, the market value is based upon the Kelley Blue Book value of the vehicle before the damage occurs.

Admitted Insurance Company

This is insurance that has been purchased from an insurance company that has been formally licensed and registered in the state where the policy is bought. The insurance agent or broker is licensed in the state, and the state regulates the broker and the company in their marketing practices, also keeping an eye on the insurance policies that are sold.

Agent

An agent is an employee of an insurance company that must be licensed in the state(s) where he or she works. The main purpose of an agent is to provide answers to questions about the company's policies and services and to recommend solutions to various problems. Outside of car insurance, an agent may also sell life insurance and health insurance.

Aircraft Insurance

This is a form of coverage offered by a highly specialized insurance company that provides monetary compensation for medical expenses and property damages in the event of an accident. It will also provide for repairs to an aircraft if an owner's negligent actions contribute to the detriment of the aircraft while flying. The different forms of aircraft insurance include owner's, renter's, and CFI coverage.

Automobile Insurance

This is a form of coverage for a motorist that will provide protective funds for the risks that are associated with owning and operating a vehicle. The most common forms of coverage include liability, collision, and comprehensive insurance. Automobile insurance is required by the law for the legal operation of a vehicle, and the different forms of insurance a motorist must carry are determined by the state the person lives in.  Automobile insurance is also referred to as car insurance or vehicle insurance.