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Automobile Insurance Definitions & Glossary: L -  N

The eagle-eyed ones amongst you may have spotted that there is no “J”, don’t worry, I haven’t forgotten it in error, there just wasn’t really anything important enough to add. Right, now that’s settled . . .

Lapsed Policy – is a policy which has come to a premature end, generally because the premiums haven’t been paid.

Legal Liability – is what you are liable for according to the law, not just your own individual contract or car insurance policy.

Liability Adjuster – is the person who handles the investigation into your accident or claim. They are responsible for collision payments, bodily injury settlements (if necessary), payments for damage to other property (maybe the guy whose wall you just knocked down . . . ), they might even be in charge of handling any medical costs in some states.

Liability Insurance – is a portion of car insurance cover which provides money to pay for bodily injury or property belonging to another party, on behalf of the policy holder.

Limit – is the top dollar amount that the insurance company will pay out for any claim against the insured.

Loss of Use – can be paid to a third party to make up for their inability to use their property as a result of any accident related damage.

Material Damage – is insurance cover for any material damage which is covered by the car insurance policy – Property Damage (PD), Collision Damage (Coll), Comprehensive Damage (Comp), Fire/Theft Combined Additional Coverage (FTCA), Uninsured Motorist Property Damage (UMPD) are the usual ones.

Material Misrepresentation – a bit like the fraud on the other page. It really means that the policy holder has been telling porkies on the application form. The policyholder might say, for example, that the vehicle will be kept in a locked garage (thereby reducing premiums) when it will actually spend it’s nights parked on the road outside.

Mechanical Breakdown Insurance – can cover the costs of all mechanical repairs to your car.

Medical Adjuster – will deal with everything related to the medical side of your claim. The medical bills,  loss of wages arising from medical treatment to both the insurer and often any passengers in the vehicle who have been affected (this varies from state to state).

Medical Payments Cover – will be specific to each policy. It’s designed to meet any medical expenses which are related to the automobile accident.

Motor Vehicle Record (MVR) – tells whether you’ve been a good boy/girl on the roads. It’s from the agency which issued your drivers license and lists all violations and accidents which appear on your drivers record.

Multi Car Discount – is offered by some motor vehicle insurance companies. If any family has more than one car (and that’s the majority of them these days), then they might be able to negotiate a little discount by insuring them all together on one policy.  You might even get a discount on your personal car if you drive a company car which is insured by your employer.

Named Insured – is the name of the person, company or organization which is actually on the insurance policy. Your car insurance policy might also cover other people (passengers etc) who are not actually named on the insurance policy.

No Fault Insurance – is a type of cover which might pay for expenses related to an accident (medical bills, loss of wages etc), regardless of who was to blame for the accident. There are obviously lots of limits and conditions on this type of insurance cover, and it’s not even available in some states. Wonder why??

Non-Renewal – is when the insurance company, for some reason (which they have to tell you) choose not to renew your car insurance policy when the term of it has expired. Actually, there’s a whole page on non-renewal of motor insurance.