Bell Auto Insurance Glossary

Bell Insurance explains some of the most common auto insurance terms in this online insurance glossary.



Collision Coverage

Insures for the loss resulting from the striking of another object by a moving vehicle.


Comprehensive Coverage

Insures automobiles and other motor vehicles against loss by fire, theft, or other physical damage hazards except for losses caused by collision or upset. Towing and labor coverage is optional on autos with comprehensive coverage.



The amount that must first be subtracted from the total damage incurred (paid by the insured) before determining the insurance company's liability (payment).



A dwelling is a house in which people live, as distinguished from a garage, storage building or any other building.


Extended Non-Owned Auto Coverage

Extended non-owned auto coverage is available on vehicles not owned but driven regularly by household members. Company cars are commonly added this way. If you have a company vehicle provided to someone in your household, contact your agent to discuss the coverage issues involved. Optional coverage is also needed for customized paint or equipment, stereo or other electronic equipment, disks and tapes, joint ownership, trailers and camper body coverages, and for special vehicles like classic autos, antique autos and farm trucks. Contact your agent if you have any of these situations.


Full Coverage

This phrase is commonly used to indicate that a vehicle has liability, uninsured, underinsured and Personal Injury Protection or Medical Payments, as well as comprehensive and collision. It does NOT indicate that all optional coverages are provided or that the amounts of coverage are adequate. When a car is sold under finance contract, the loss payee (lender) usually requires a copy of the policy showing that collision and comprehensive coverage is provided and that they are listed on the policy according to their legal interest.


Gap Insurance

Gap Insurance is a special coverage for autos with a loan or lease. It is an optional coverage to cover the "gap" or difference at the time of loss between the Actual Cash Value of the vehicle and the loan or lease pay-off amount.


Homeowners/Condo/Renters Optional Coverages

There are literally 100 or more options to provide coverage or increase the coverage provided by the standard homeowners policy. While it may seem simple to properly insure your home and its contents at first, a review with your agent of the limitations and exclusions of the policy often reveal a number of modifications that should be made to provide the coverage you desire.


Liability Insurance

Protection that pays sums the insured is legally obligated to pay, or that the insurer has agreed to pay, as damages to others as a result of the insured's negligence. Usually provides coverage arising from alleged bodily injury or property damage to others.


Liability Only

This phrase is commonly used to indicate that a vehicle has liability, uninsured, underinsured motorist and Personal Injury Protection or medical payments, but does NOT have comprehensive or collision coverage.


Loss of Use Coverage

Loss of Use Coverage compensates the policyholder for the inability to use property that was damaged or destroyed by an insured peril. For example, if a home is damaged by fire, the Loss of Use helps meet the increased costs of living such as hotel bills, or a rental home, eating out or other living expenses while the home is being repaired.


Loss Payable Clause

A condition in a policy whereby the company may be directed by the policyholder to pay any loss due the policyholder to some other party designated in the policy. Usually the payment is made by check or draft payable to both the insured and the designated payee, often referred to as the Loss Payee. The loss payee is the entity that holds the loan on the property.


Medical Payments Coverage

Reimburses for the necessary expenses for medical, hospital and funeral costs for persons other than the "insured" or employees of the insured, who are injured while on the insured's premises. The coverage is available whether the policyholder is liable or not.


Other Structures (detached garage, gazebos, etc.)

Other structures on a homeowner's policy refer to structures other than the dwelling and are separated from the dwelling by clear space. This would typically include detached garages, storage sheds, gazebos, fences, etc.


Personal Injury Protection (PIP)

Personal Injury Protection (PIP) is also known as no-fault insurance. It is a mandatory coverage in some states, particularly those that do not have Medical Payments. PIP provides insurance for medical costs, loss of earnings, additional living expenses, and funeral costs for occupants of the insured automobile and pedestrians other than those insured under other policies. The options vary by state and insurance company. The amount of insurance you purchase is dependent on several factors, including your health insurance benefits, short-term and long-term disability benefits as well as family composition. Discuss these issues with an agent to determine what is right for your situation.


Personal Property

Property other than land and buildings often referred to as "contents." Also includes the contents found in other structures. Certain types of property have specific dollar limits or are subject to exclusions.


Rental Reimbursement Coverage

An optional personal auto coverage endorsement to provide reimbursement for the expenses incurred by an insured when a temporary replacement vehicle is needed following a covered accident to the insured's vehicle.


Replacement Cost

When used in property insurance contracts, this is the amount it would take to replace the property with like property of the same quality and construction. No deduction is made for depreciation or obsolescence.


Underinsured Motorists Coverage

Coverage an insured person purchases to protect his or her own self or family members from damage or injury caused by a negligent party with a motor vehicle who does not have adequate limits of insurance to cover the loss.


Actual Cash Value

The basis of loss settlement in property insurance policies, which takes into consideration factors such as replacement value less depreciation, market value, rental value, the use of the building, the area in which it is located, obsolescence, assessed valuation, and any other factor that would have an effect upon the value. A working rule-of-thumb definition is "replacement cost new at the time of loss, less depreciation."

Bell Insurance Services, LLC is a wholly owned subsidiary of Bell Bank. Products and services offered through Bell Insurance are: Not FDIC Insured | No Bank Guarantee | May Lose Value | Not A Deposit | Not Insured by Any Federal Government Agency