The Pennsylvania Insurance Department is here to

help you understand automobile insurance. In the

next few pages you will learn about auto insurance,
types of coverage available, and some tips on how to
shop and what to do if you are in an accident.

There is no such thing as a “full coverage” auto

insurance policy. Insurance coverages and policies can
vary. The information in this guide is intended to help
you understand auto insurance. The information is
general and not specific to your insurance policy. If
you have specific questions about your coverage, you
should consult your agent or insurance company.
What Is Automobile Insurance? Medical Benefits

This coverage pays the medical bills for you and

Automobile insurance is a
others who are covered by your policy, regardless of
contract between you and
fault, if there are injuries resulting from an accident.
your insurance company. It
The minimum limit is $5,000. Higher limits are
protects you against financial
also available.
loss if you are in an auto
accident. Auto policies Bodily Injury Liability
contain a variety of required
and optional coverages. You If you injure someone in an auto accident,
agree to pay a fee, called the premium, this coverage pays damages for which |
and in return, the insurance company you are liable, such as medical and
agrees to pay for certain losses as rehabilitation expenses. The minimum
defined in your policy. Having the limit is $15,000/$30,000. The $15,000
right insurance coverage may prevent pays for injuries to one person, while
you from suffering a large financial loss the $30,000 represents the total available for
in the event of an automobile accident. one accident. Higher limits are also available.

Is Auto Insurance Mandatory in Property Damage Liability

the Commonwealth? If you damage someone’s property (such as his or her

car) in an accident and you are at fault, this coverage
Drivers must purchase and maintain auto insurance pays for repairs to that property. The minimum
to legally drive in Pennsylvania. This is called limit is $5,000. Higher limits are also available.
maintaining “financial responsibility” on your
Some companies offer a combined single limit of
vehicles. A lapse in insurance coverage may result in
$35,000 which meets the bodily injury liability and
the suspension of your vehicle registration. Operating
property damage liability minimum requirements.
a vehicle without the required insurance
may result in a fine, the suspension of
your driver’s license, and the forfeiture
of your license plate and registration Required coverages in Pennsylvania:
sticker. Restoration fees and proof of
insurance must be provided prior to « Medical Benefits
having either registration or driving
privileges returned. Insurers are « Bodily Injury Liability
required to report policy terminations
to PennDOT. Drivers are responsible for « Property Damage Liability
providing proof of continuous coverage.

What Are the Required What Do Policy Limits Mean?

Coverages in Pennsylvania? The coverage limits are the most your insurance
When you purchase auto insurance, there are certain company will pay for injuries to any one person,
coverages that are required and others that are all persons injured in an accident, and for property
optional. The required coverages are: damage. If you do not have enough liability

Please refer to the Glossary found on page 11 for definitions of the terms in bold face.

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 Stacking of UM or UIM
When you stack your UM and/or UIM
coverages, your limit of coverage for each
covered vehicle on your policy is multiplied by
the number of vehicles on the policy. You can also
stack your UM and/or UIM coverages to receive
uninsured or underinsured motorist
coverage from more than one policy under
which you are insured. By law, stacked
coverage applies unless you reject it. You
will pay less in premiums if you reject
stacked coverage.

Funeral Benefit
Funeral Benefits pay, up to the limit specified in
the policy, for funeral expenses if you or a family
member dies as a result of an auto accident, regardless
of who was at fault in the accident.

Income Loss
This pays a portion of your lost wages when injuries
coverage, and you are found at fault for an accident, sustained in an auto accident keep you from working.
you may be responsible to pay for anything your
Collision
insurance does not cover.
Collision coverage pays to repair damage to your
What Are the Optional car as a result of an accident. Most banks or lenders
Coverages in Pennsylvania? require you to buy this coverage to receive a car loan.
Under Pennsylvania law, the insurance company
Auto insurance policies also offer a variety of applies a $500 deductible unless you request a
additional optional coverages that can be purchased. lower amount. Generally speaking, the higher your
These include: deductible, the lower your premium.

Uninsured Motorist (UM) Comprehensive

This coverage applies to you, relatives residing in Comprehensive coverage pays for theft or
your household, and your passengers if injured by an damage to your car from hazards such as fire, flood,
at-fault uninsured motorist or hit and run driver. vandalism, and striking an animal. Most banks or
This does not cover damage to property. lenders require you to buy this coverage to receive a
car loan. There are various levels of deductible that
Underinsured Motorist (UIM)
may be purchased.
This coverage applies to you, relatives residing in
Extraordinary Medical Benefits
your household, and your passengers if injured by
an at-fault motorist who does not have enough This pays for medical and rehabilitation expenses that
insurance to pay your claim. This does not cover exceed $100,000, up to a maximum limit of $1.1
damage to property. million.

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Accidental Death Benefit of the vehicle, its safety features, where the vehicle
is garaged, the average number of miles driven in a
Accidental Death Benefit pays a specified dollar benefit
year, the coverages and limits chosen for the policy,
to the personal representative of a person who dies as
and the driving history of the drivers, to name a few.
a result of injuries sustained in an auto accident.
Some companies may use your credit history when
Rental Reimbursement Coverage determining your premium. Companies cannot use
it to increase your rate when you renew. By law,
Rental Reimbursement Coverage pays—up to the insurance companies are prohibited from charging
limit on your policy, your expenses to rent a vehicle different rates based on an applicant’s race, religion,
if the vehicle on your policy sustains a covered national origin, and gender.
comprehensive or collision loss.

Towing Coverage

This reimburses you, up to the limit of

By law, insurance companies are
your policy, for towing and labor costs prohibited from charging different
for your covered vehicle. This coverage is
usually only available if comprehensive
rates based on an applicant’s race,
and collision is carried on your vehicle. religion, national origin, and gender.
GAP Coverage

Guaranteed Asset Protection (GAP) will What Should I Know Before I

pay the difference between an insurance company’s
payment for a totaled vehicle and the balance of a
Start to Shop?
vehicle loan. This coverage is traditionally purchased You need to know what coverages you want, as well
when an individual is buying a new vehicle. as the limits and deductibles you desire. Also, you
These policies do not pay for deductibles, missed should have the following basic information available
payments, or late fees and many times have a limit on all drivers in your household:
to the amount they will pay. Check your policy
carefully when choosing to add GAP coverage. « All drivers’ names, ages, and marital statuses;

How Are Rates Determined? « Driving record (accidents and moving violations);
« Estimated annual mileage driven;
When you are ready to purchase insurance, the
insurance company or producer (agent) will « Full vehicle identification number;
ask you a series of questions and, based on your
answers, will decide whether or not they will accept
« Year of vehicle;
you as a policyholder. This practice is known as « Cost of vehicle; and
underwriting. By law, insurance companies may
not unfairly discriminate by using underwriting « Special equipment, such as anti-theft devices,
airbags, etc.
standards based on things such as race, religion,
nationality, ethnic group, age, gender, family size,
occupation, place of residence, and marital status.

Certain items will be taken into consideration when

figuring your premium, such as the type and age

4
What Questions Should I Ask? « Can I choose any body shop or glass shop to
repair my car? Does the policy pay for original
The insurer will ask you questions and use the manufacturer’s parts or aftermarket parts?
answers to decide whether to insure you and how
much your premium should be. You should also ask « If my car is disabled, will this policy pay for a
questions to be sure you are getting the coverage you rental car while it is being repaired? Is there any
want and from an agent and insurer you trust. cap or limit?

Here are some questions you should ask your agent « If my car is disabled, will this policy
pay to have it towed to a garage or body
or company representative when you
shop?
shop for auto insurance:

« What coverages « How much can I save with

a higher deductible?
am I required to
have in this state? « What discounts are
available?
« What is the
minimum amount « What other types
of liability insurance of property do you
coverage this state insure? Can I qualify
requires me to carry? for a discount if I buy
both policies from your
« Are these liability limits high company?
enough to cover me if I have an
accident and I am at fault? « What are my payment options? Can I
pay monthly or quarterly? If I do, is there
« How much would it cost me to buy more than an extra charge?
the minimum amount of liability insurance
coverage? « How do I report a claim?
« Do I need collision and comprehensive « What coverage is available if I drive for a TNC like
(sometimes called “other than collision”) Uber or Lyft?
coverage?
Teen Drivers
« What deductible should I have for collision
coverage? For comprehensive (sometimes called Insuring a teen driver is often a significant additional
“other than collision”) coverage? cost for parents. Some companies require that a
teenager be added to the policy upon obtaining his/
« Will this policy cover me if I let someone else drive her learner’s permit. Check with your insurance
my car?
company to determine their requirements. Many
« Will this policy cover me if I have an accident in a companies consider younger drivers to be a higher
rental car while on vacation? risk, and this often translates into higher premiums.

« Will this policy cover me if I have an accident Your child may be eligible for discounts. Ask your
while traveling for work? insurance company if discounts are offered for good
grades or completed driver education courses.
« If my car is totalled, how is the value of my
vehicle set?

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Mature Drivers pain and suffering—unless the injuries meet one of
the exceptions in the law. With full tort, you have
Taking a driver safety training course is an excellent unrestricted rights. If you fail to specially elect limited
way to keep your driving skills sharp, and it can tort, you will be deemed to have elected full tort.
also earn you a reduced rate on your car insurance
Deductibles
if your carrier offers such a discount. Pennsylvania
law requires insurance companies to provide at least a By choosing higher deductibles on comprehensive
five percent premium discount for each vehicle on an and collision coverage, you may be able to lower
auto policy under which all named insureds are 55 your policy cost. Just remember that the deductible
years of age or older and have successfully completed you choose is what you are responsible for paying
a driver improvement course that meets the standards out of your pocket in the event you file a claim.
of PennDOT.

Individuals must take an approved course every

Where to Buy Insurance
three years to continue to be eligible for the discount. Now that you know all about what to look for when
They may be disqualified if, within three years choosing your auto insurance, let’s talk about where
of completing the course, they are involved in a to buy a policy.
chargeable accident, convicted of a moving violation,
or are convicted—or have Accelerated Rehabilitative Agents
Disposition (ARD)—for driving under the influence of
Agents are individuals
alcohol or a controlled substance.
available locally to
Insurance companies recognize that mature drivers address your car
face unique challenges as they get older, and they will insurance needs. Local
reward those mature drivers who take the initiative to agents can be independent
minimize risk by enrolling in approved driver training or captive. If your agent is
courses. independent and not exclusive
to one insurance company, he or
Know How to Save she can compare policies and sell you the one that best
meets your needs from among the
Discounts multiple insurance companies he
or she represents. If your local agent
Most insurance companies offer discounts for
is a captive agent, he or she
safer drivers, safer cars, drivers with multiple
exclusively represents one
types of policies, good students, and more.
insurance company.
There are also a variety of discounts that are
required by law, like the mature drivers Direct
discount mentioned above. Ask your insurance
company today and you could start to save. Some insurance companies sell
their policies directly over
Limited or Full Tort the phone or Internet
without using agents. In
If you are in an automobile accident, you are able
some cases, you can
to recover out-of-pocket medical and certain other
choose to interact with a
expenses. Limited tort offers you significant
direct company exclusively
savings on your premium but you are not able
over the Internet.
to recover certain damages—such as payments for

6
A good rule of thumb is to get quotes from at least agreements are separate contracts that often include
three different insurance companies. Make sure your a limited power of attorney that gives the finance
quotes are for the exact same coverages and limits. company some authority over the termination of
Cost can vary significantly among companies. Ask your policy. Moreover, if the policy is cancelled, the
for copies of the insurance policies. It is important to insurance company must remit all return premiums
read the policies to understand the differences in to the finance company, which will apply them to your
coverage from policy to policy and especially account.
what is excluded. No two policies are exactly
the same. Personal effects and equipment such as
cellular telephones, compact discs,

Things to Keep in Mind CD players, and custom stereo

speakers and systems that are not
Make sure you know the length permanently installed in the vehicle
of the policy term. The most by the manufacturer generally are not
common policy terms are six covered, unless specifically declared and
months (semi-annual) and added to the policy.
one year (annual). While
Read before you sign. Remember, you are ultimately
policies sold for a term of
responsible for the accuracy and completeness of the
less than one year may
information on your application.
require less money up front,
they will be re-priced at the
end of the policy term. Keep Should You Drop Comprehensive
in mind that an insurance and/or Collision Coverage on an
company can only non-
renew you on the annual
Older Car?
anniversary of when your It may not be cost-effective to have comprehensive
policy was initially written, or collision coverage on cars worth less than $1,000.
even if the policy term is less than 12 months.
What Happens if I Can’t Get
Auto Insurance Because of
Remember, you are ultimately My Driving History?
responsible for the accuracy
and completeness of the
Pennsylvania’s Assigned Risk Plan is a
program that offers car insurance to those
information on your application. who are unable to get coverage on their own.
All insurance companies writing automobile
insurance in the commonwealth are required
Many companies have payment plans that allow you to participate in the plan. Applicants are
to pay the premium over a period of time, sometimes assigned to insurance companies in proportion to
for an extra fee. If you decide to buy a policy on a the amount of business each company writes in the
payment plan, find out the applicable installment fees. commonwealth. To learn more about the Assigned
Risk Plan you can visit www.aipso.com or contact
If you use a premium finance company to pay for the plan’s customer service office at (401) 946-2800
your insurance, the monthly payments may be easier, or toll-free at (800) 477-6146.
but the total of payments could be larger. Finance

7
After You Purchase Insurance questions, contact your insurance agent or company.
They are responsible for serving your policy,
After you purchase automobile insurance you will including responding to any questions you may have
receive your policy. Your policy is a contract between regarding the terms in your policy. If you purchased
you and your insurance company. You should take a policy directly from the insurance company, a
time to read your policy. Every policy includes a company representative should be able to respond
declarations page (below). It lists the insurance to your questions. If you still have questions, you
company, your name, the policy number, vehicles, may choose to email, write, or call the Pennsylvania
coverages, deductibles, limits, cost of premium, Insurance Department’s Bureau of Consumer
and effective and expiration dates. If you have Services. We will be happy to answer your questions.

*Please refer to pages 2 and 3 for the Required Coverages and Optional Coverages in Pennsylvania.

8
Be sure to pay your premium. Pennsylvania law detailing the reasons you disagree with the action to
does not require companies to extend a grace period the Pennsylvania Insurance Department. To preserve
for premium payments. If your insurance company your appeal rights, the statement must be
does not receive your premium by the due date, the received by the Insurance Department within 30
company can cancel your policy. days of the company’s mailing of the notice.

Keep your proof-of-insurance card in your car at all

times.
What if I Don’t Understand All
the Terms in My Policy? What
What if I Drive for a Should I Do?
Transportation Network Discuss with your insurance producer (agent) or
Company Like Uber or Lyft? company the terms in your policy. If you purchased
your policy directly from the insurance company, a
If you drive for a Transportation Network Company
company representative should be able to respond to
(TNC) like Uber or Lyft, you want to understand
your questions. If you still have questions, you may
what coverages, if any, the TNC has in place that
choose to write or call the Pennsylvania Insurance
will cover you. While the TNC should have coverage
Department’s Bureau of Consumer Services.
in place, you may also want to have your own
coverage. Most personal auto policies do not provide
coverage while you are carrying a passenger for hire.
However, there are insurers who do offer to endorse The Pennsylvania
coverage onto your policy—usually for an additional
premium. It is important not to drive for a TNC
Insurance Department
until you are sure that the coverage you need is in Whether you have a general question,
place to protect you. or want to file a complaint, you can
get help at Consumer Services online
What Should I Do if I Receive a at www.insurance.pa.gov or contact
Cancellation or Non-Renewal us toll-free at 1-877-881-6388.

Notice from My Insurance

Company? What Do I Do if I Am in an
First, contact your insurance producer (agent) Accident?
or company for specific details. Pennsylvania law
If you are in an accident you should exchange
allows companies to cancel or non-renew policies
information with the other driver. If there are injuries,
for certain reasons. If you still are not satisfied with
call 911. Be sure to obtain the name, insurance
your company’s explanation, submit a statement
company name, and phone number of each of the
other drivers. If you cannot obtain this
information, write down the license
If you are in an accident you should plate number of each of the other

exchange information with the other drivers. Other important information is

as follows:
driver. If there are injuries, call 911. « The year, make, and model of each of
the other cars;

9
 you that it has accepted or denied your claim or
« If there are witnesses, their names and contact
information; and provide you with a written explanation of why
more time is needed.
« If an officer comes to the scene, his or her name,
badge number, police report number, and contact « An insurance company must complete its
information. investigation within 30 days of its receipt of notice
of your claim, unless the investigation cannot
After the accident, write down the date, time, and reasonably be completed within 30 days. If the
location. If possible, take photos. Write down what investigation cannot be completed within 30
happened. This will assist you when reporting the days, for every 45 days thereafter, the insurance
claim to your insurance company. company must provide you with an explanation
for the delay and state when a decision on
the claim may be expected.
Ultimately, the insurance company
is responsible for returning Vehicle Repairs
your vehicle back to its pre- The choice of where your vehicle is repaired
is up to you. Be sure to do your research
damaged condition. when choosing an auto body repair shop.
Some questions to ask:

Filing a Claim « How long has the shop been in business?

To file a claim, call the phone number on your proof- « What is the shop’s reputation in the
community?
of-insurance card as soon as possible. The insurance
company will assign a claims adjuster to investigate
« Does the shop offer a lifetime warranty?
the claim. You should cooperate with the adjuster’s
investigation of your claim. Take notes and keep « Has the shop worked with your insurance
track of the dates of conversations you have with company in the past?
your adjuster.

If you, the insurer, and the claims adjuster disagree,

first try to resolve the differences with your insurer.
Your agent may be helpful. Don’t feel rushed or
pushed to agree to something you aren’t
comfortable with.

Insurance companies, by law, must investigate

your claim fairly and promptly.
Whether an insurance company recommended the
« An insurance company has 10 working days to shop or not, the most important thing is a quality
acknowledge its receipt of notice of your claim
repair.
unless payment is made within these 10 days.
If you choose an auto body repair shop that charges
« If you submitted a claim to your own insurance more than the appraised amount to repair the vehicle,
company, it has 15 working days after receipt
you may be responsible for costs in excess of the
of properly executed proofs of loss to inform
appraised amount.

10
Pennsylvania law permits the use of non-OEM/ vehicle. Depending on the agreement between the
aftermarket parts but “the operational safety of lienholder and the owner, the insurance payment
the vehicle shall be paramount in considering the can be made directly to the lienholder, the owner,
specification of new parts.” This consideration is or both. If the actual cash value is less than you owe
vitally important for parts involving the drive train, on the vehicle, you may be responsible to pay the
steering gear, suspension units, brake system, or tires. difference to the lienholder. If you believe your loan
is more than the cash value, there are products that
Aftermarket parts are usually made by a company are available at that time that may eliminate or offset
different than the original part manufacturer. Be these costs.
sure to consult with your auto body repair shop or
insurance company if you have any safety concerns One such product provided by insurance carriers is
or part fit concerns when aftermarket parts are used Guaranteed Asset Protection (GAP) Coverage, which
to repair your vehicle. If aftermarket crash parts will generally pay the difference between an insurance
are included in a vehicle appraisal, it must include a company’s payment for a totaled vehicle and the
statement that the appraisal has been prepared based balance of a vehicle loan. This coverage is traditionally
on the use of aftermarket crash parts, that the purchased when an individual is buying a vehicle.
use of these parts voids the existing warranty on the GAP coverage does not pay for deductibles, missed
part being replaced, and the aftermarket crash part payments, or late fees and many times there is a
shall have a warranty equal to or better than the limit to the amount it will pay. Check your policy
remainder of the existing warranty. carefully when choosing to add GAP coverage. If
you have questions about GAP coverage, ask your
Used parts are original equipment (OE) from your insurance agent or company.
vehicle’s manufacturer. Be sure to consult with your
auto body repair shop or insurance company if you Another product that may be purchased in relation
have any safety concerns about parts being used to to a vehicle loan is a Debt Cancellation Agreement
repair your vehicle. (DCA). When this product is sold by the bank issuing
the vehicle loan, it is not considered insurance, but
Ultimately, the insurance company is responsible it functions similar to GAP Coverage. A DCA is an
for returning your vehicle back to its pre-damaged agreement between the loan issuer and the debtor to
condition. If the company uses new parts to replace cancel any remaining debt if the debtor experiences
parts damaged on an older model vehicle, you may a total loss and the amount of debt on the vehicle
be responsible for additional costs as the vehicle is in exceeds its actual cash value. Also similar to GAP
better condition than before the accident. Coverage, this product is traditionally purchased at

What Happens if My Vehicle Is a

the time that the vehicle is bought.

Total Loss?
A vehicle is a total loss when the cost to return it
The Pennsylvania
back to the pre-damaged condition is more than the Insurance Department
value of the vehicle or the vehicle is damaged too
severely for repairs. There are different methods that Whether you have a general question,
can be used to calculate the replacement value of your or want to file a complaint, you can get
vehicle. If you have questions regarding the method help at Consumer Services online
used, contact your insurance agent or company. at www.insurance.pa.gov or contact
us toll-free at 1-877-881-6388.
Many people make monthly payments on their

11
Auto Insurance Glossary—a
Supplement to the Automobile
Insurance Guide
These definitions are offered to give you a
general understanding of the terms you may hear
that are associated with automobile insurance. Please
note that your individual company may define Claim
similar terms differently. The definitions page in Notice to an insurance
your policy is the final authority regarding company that a loss has occurred
your coverage. which may be covered under the terms and
conditions of the policy.
Adjuster
The person who manages the various aspects of Collision
a claim and determines what will be paid out in Pays to repair damage to your car as a result of an
accordance with the policy and the facts. accident. Most banks or lenders require you to buy
this coverage to receive a car loan.
Aftermarket Crash Part
A non-original equipment manufacturer (OEM) Commission
replacement part, either new or used, for any of the A portion of the policy premium that is paid to
non-mechanical parts that generally constitute the an insurance producer (agent) by the insurance
exterior of the motor vehicle, including inner and company as compensation for the producer’s work.
outer panels.
Comprehensive Coverage
Appraiser Pays for theft or damage to your car from hazards
The person who evaluates the damage caused by an such as fire, flood, vandalism, and striking an
accident or other covered loss and determines the animal. Most banks or lenders require you to buy
amount to be paid under the policy terms. this coverage to receive a car loan.

Assigned Risk Plan Declarations (DEC) Page

A program where drivers can get coverage when Usually the first page of an insurance policy, it
insurance companies are unwilling to sell them a contains the full legal name of your insurance
policy. company, your name and address, the policy
number, effective and expiration dates, premium
Binder payable, the amount and types of coverage,
A short-term agreement that provides temporary deductibles, the vehicle(s) that are covered on the
insurance coverage until the policy can be issued or insurance policy, and the vehicle identification
delivered. numbers (VIN).

Bodily Injury Liability Deductible

If you injure someone in a car accident, this The amount a policyholder is responsible to pay
coverage pays damages for which you are liable, up front before covered benefits from the insurance
such as medical and rehabilitation expenses. company are payable. This is applicable to
comprehensive or collision coverage only.
Cancellation
The termination of a policy at a date other than its
annual anniversary date.

12
Endorsement Limited Tort
A written agreement that changes the terms of an Limited Tort offers you significant savings on your
insurance policy by adding or subtracting coverage. premiums. You are still able to recover out-of-
pocket medical and certain other expenses; however,
Exclusion you are not able to recover certain damages—such
A provision in the policy that explains what is not as payments for pain and suffering—unless the
covered. injuries meet one of the exceptions in the law.
Extraordinary Medical Benefits Limits
Pays for medical and rehabilitation expenses that The maximum amount of benefits the insurance
exceed $100,000, up to a maximum limit of $1.1 company agrees to pay under an insurance policy
million. in the event of a loss.
First Party Minimum Limit
The named policyholder (insured) in an insurance The state-mandated minimum mandatory amount
contract and any relatives residing in the named of benefits.
policyholder’s household.
Medical Benefits
Full Tort Pays medical bills for you and others who are
You retain unrestricted rights to bring suit against covered by your policy, regardless of fault.
the negligent party.
Non-Renewal
Funeral Benefits The termination of an insurance policy at its annual
Pays, up to the limit specified in the policy, for anniversary date.
funeral expenses if you or a family member dies as
a result of an auto accident, regardless of who was Policy
at fault in the accident. A contract that states the rights and duties of the
insurance company and the insured.
Income Loss
Pays a portion of your wages when injuries Premium
sustained in an auto accident keep you from The price paid to the insurance company for a
working. policy.

Insured Premium Finance Company

The person(s) entitled to covered benefits in case of A lending institution that finances automobile
an accident or loss. insurance premiums for a fee.

Insurer Producer (agent)

The insurance company who issues the insurance An individual or organization authorized to sell,
and agrees to pay for losses and provide covered solicit, negotiate, and service insurance policies for
benefits. an insurance company.

Lienholder Property Damage Liability

A person or business, usually a bank or financial Covers damage to someone’s property (such as his
firm, that retains the title of a vehicle while the or her car) resulting from an accident in which you
purchaser pays off the loan. are at fault.

13
Quotation or Quote Surcharge
An estimate of the cost of insurance based on the An extra charge applied to the premium by an
information supplied to the insurance producer insurance company, usually applied as a result of
(agent) or company. This amount may change at-fault accidents or moving violations.
depending upon findings during the underwriting
process. Third Party
An individual other than the policyholder or the
Rental Reimbursement Coverage insurance company who has suffered a loss and
Pays—up to a defined amount—your expenses may be able to collect compensation under the
to rent a vehicle if you have a loss covered under policy, due to the negligent acts or omissions of the
comprehensive or collision benefits. Coverage is sold policyholder.
based on a daily amount of expense, subject to a
maximum limit. Total Loss
Damage or destruction to real or personal property
Single Limit Liability to such extent that it cannot be rebuilt or repaired
Some companies offer single limit liability coverage, to its condition prior to the loss or when it
which pays—up to the specified limit—damages would be cost-prohibitive to repair or rebuild in
for which you are liable under bodily injury and comparison to the value of the property prior to the
property damage coverages. loss.

Stacking of UM or UIM Towing Coverage

When you stack your UM and/or UIM coverages, An optional coverage of an automobile policy that
your limit of coverage for each covered vehicle on pays a specified amount for towing and related
your policy is multiplied by the number of vehicles labor costs.
on the policy. You can also stack your UM and/or
UIM coverages to receive uninsured or underinsured Underinsured Motorist (UIM)
This coverage applies to you, relatives residing in
motorist coverage from more than one policy under
your household, and your passengers if injured by
which you are insured. Stacked coverage applies
an at-fault motorist who does not have enough
unless you reject it.
insurance to pay your claim. This does not cover
Subrogation damage to property.
The process of recovering the amount of claims
damages paid out to a policyholder from the legally Underwriting
The initial 60-day time frame wherein the company
liable party. When a company pursues the legally
processes and investigates the information provided
liable third party, they are required to include the
on the application. The results of this process
policyholder’s deductible in the recovery process if
determine acceptability and the premium.
requested by the policyholder. The company must
then share any subrogation recoveries with the Uninsured Motorist (UM)
policyholder on a proportionate basis. This coverage applies to you, relatives residing in
your household, and your passengers if injured
by an at-fault uninsured motorist or hit and run
driver. This does not cover damage to property.

14
 Questions?
For more information on
auto insurance, visit:

www.insurance.pa.gov
and click “Auto” under
Coverage

or
call the department at
1-877-881-6388

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@PAInsuranceDept
Facebook.com/
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Rev. 10/2016 v3