Accident Terms and Definitions

Replacement Cost
Replacement cost is the cost of replacing lost or damaged property with new property of like kind and quality, at current market prices.

Towing & Labor Coverage
Pays for towing charges when your car can’t be driven. Also pays labor charges, such as changing a flat tire, at the place where your car broke down.

Gap Insurance
Insurance that pays the difference between the actual cash value of a vehicle and the amount still to be paid on the loan. Some gap policies may also cover the amount of the deductible.

Cancellation
The termination of an insurance policy before its normal expiration date.

Binder
A temporary or preliminary agreement which provides coverage until a policy can be issued/delivered.

Policy
Written contract of insurance.

Vehicle ID No. (VIN)
This 17 character number is unique to each vehicle. It identifies characteristics of the vehicle, including manufacturer, year, model, body, engine specifications, and serial number.

Salvage
Property taken over by an insurer to reduce its loss.

Claim
Notice to an insurer of a loss that under the terms and conditions of a policy may be covered.

Exclusion
A contractual provision in an insurance policy that denies coverage for certain perils, persons, property, or locations.