Insurance Vocabulary 101
Premiums, deductibles, liability, comprehensive, collision — every basic term defined in everyday language.
Auto insurance has a vocabulary problem. The same paperwork that decides what happens after a wreck is written in language most first-time drivers were never taught.
A premium is what you pay the insurance company on a regular schedule, usually monthly or every six months. A deductible is what you pay yourself before insurance starts covering a claim. A higher deductible usually means a lower premium.
Liability covers damage you cause to other people or their property. Collision covers your own car when you hit something. Comprehensive covers your car for non-collision events like theft, hail, or a tree branch falling.
Once these five words are clear, most policies become readable. The rest of our lessons build on top of this short list.