Do you find yourself not understanding some words or terms your insurance company uses? If so, you are not alone. Insurance policies can be confusing to most everyone. We should take a look at some common terms used in your auto insurance policy. Maybe a brief description will help for the next time you review with your agent.
A good place to start is with the term Automobile. Your Ontario auto insurance policy uses the terms described automobile and automobile, and there is a difference. A described automobile is any vehicle which is specifically shown on your auto policy (Certificate of Automobile Insurance). But an automobile could be a number of things, including a described automobile, a newly acquired automobile, a temporary substitute automobile, other automobiles driven by you or your spouse who lives with you, or trailers.
A Described Automobile, as indicated above, is any automobile or trailer specifically shown on your policy. The policy shows the coverage that has been purchased for each described automobile, which could include Liability, Accident Benefits, Uninsured Automobile, Direct Compensation Property Damage, and Loss or Damage.
A Newly Acquired Automobile is an automobile or trailer you acquire as owner that is not covered under any other policy. It may be the replacement of a described automobile or an additional vehicle. This type of auto will have the same coverage as the described auto it is intended to replace or supplement, as long as you insure all your vehicles with the same insurer. It will be insured from the date of delivery if you let your insurer know about it within 14 days and pay any additional premium. Your insurer may choose to inspect the new auto and any related equipment at any reasonable time. Be sure to discuss coverage for your new vehicles with your insurance agent (regardless if it is a replacement or an addition) to ensure you properly understand what you are insured against.
A Temporary Substitute Automobile is intended to be used only temporarily while a described automobile is out of service. During this time, the described auto must not be used by anyone insured under the policy. A temporary substitute automobile cannot be owned by you or anyone living with you. Talk with your professional insurance advisor about the coverage for a temporary substitute vehicle and any special conditions you should be made aware of that apply.
These are just a few insurance terms that to provide a better or easier understanding. When confused simply ask an Erie Mutual Insurance representative to explain, we are always available to assist our members. If you would like more information, take a look at your Ontario Automobile Policy (OAP 1) Owner Policy to learn about Direct Loss or Damage, Excluded Driver, Proof of Loss, and others. The OAP 1 should be provided to you by your insurance agent at the time of purchasing automobile insurance, but you can request a copy from your insurance company at any time.
A copy is also available online at http://www.fsco.gov.on.ca/en/auto/forms/pages/oap1_forms.aspx.
Article Written by Darcy Johnson
Erie Mutual Insurance Manager – Sales, Marketing & Business Development
Please contact us with any questions you may have about this or any other topic related to your insurance.