Motorcycle Insurance Glossary

A

Actual Cash Value (ACV)

The replacement cost minus depreciation

Additional Operator

Someone other than the named insured who is authorized to operate the covered motorcycle either because they have a motorcycle license and no motorcycle of their own or they ride the covered motorcycle without a motorcycle license

B

Betterment

The improvement of the motorcycle or property to a greater value than its pre-loss condition.

C

Cancellation

When a policy is terminated before the expiration date

Carrier

An insurance provider

Claim

A request for payment by the policyholder after an accident or other loss

Claimant

The person making the claim

Claims Adjuster

The person who determines the cause of the loss and whether or not it’s covered under the insurance policy.

Collision

When your motorcycle has a direct impact with another vehicle or object.

Collision Coverage

Add-on coverage that protects your motorcycle from damage caused by a collision with another vehicle or object, regardless of fault.

Comprehensive/Other Than Collision Coverage

Payment for repairs or replacement of a motorcycle damaged by something other than a collision. This can include vandalism, theft, smoke, etc.

D

Declarations Page

A summary of your motorcycle insurance coverage.

Deductible

Payment that the insured is responsible for in a comprehensive or collision claim before payment is made from the insurance policy.

Delinquent

A bill or policy that is overdue

Depreciation

A decrease in loss of value of the motorcycle due to use, wear and tear, or becoming obsolete.

E

Earned Premium

The amount of premium that an insurance company has earned on your policy.

Effective Date

The date the insurance policy becomes active

Endorsement

A change or update made to an insurance policy

Exclusion

An event or circumstance that is not covered by your insurance policy

F

Field Representative

An employee of the insurance company that works within a specific territory.

Flat Cancellation

The cancellation of an insurance policy before the insurance company has assumed liability, resulting in the insured getting their premium refunded.

Fraud

A deliberate misrepresentation for gain.

G

Grace Period

Some auto insurance policies have a time frame that allows customers to make a payment after the due date.

H

Hazard

An act, item, or occurrence that increases the chance of a loss.

I

Indemnify

To protect or reimburse against loss

Insured

The person covered on the motorcycle insurance policy

L

Lapse in Coverage

A period of time when a person goes without insurance coverage

Lessor

The leasing company that owns the driver’s vehicle

M

Medical Payments Coverage

Helps pay for your medical and funeral expenses if you’re in a car accident.

Misrepresentation

Giving false or misleading information

Motor Vehicle Report (MVR)

A report that lists accidents, citations, and violations that appear on your motorist record.

Motorcycle Insurance

Protection and coverage provided for damage and physical harm caused by an accident involving a motorcycle.

N

NAIC Number

A number issued by the National Association of Insurance Commissioners (NAIC) for each individual underwriting company.

O

Occurrence

P

Policy Limit

The maximum amount an insurance company will pay for a loss covered by the insurance policy.

Policy Rewrite

The process of terminating a policy before the expiration date stated in the policy and issuing a new policy.

Primary Insurance

Your primary insurance provider responds first in the event that a loss is covered by more than one policy.

Private Passenger Vehicles

A four-wheeled automobile used for private and personal use

Pro Rata Cancellation

Cancellation of an insurance policy in which the policyholder is fully refunded for premiums that have been paid in advance.

Q

Quote

An estimate of the price of your potential insurance policy.

R

Rated Driver

An active driver who is covered while driving an insured vehicle.

Rating

The determination of the cost of a premium based on risk characteristics and calculation of the chance of a loss.

Reciprocal

The information that is transferred from one state to another.

Reinstate

When a policy is reactivated without lapse after cancellation or expiration.

Renewal With Lapse

When a policy is renewed past the expiration date, after a period without coverage.

Replacement Cost

The amount it would cost to replace your motorcycle at the current market value.

Risk

The chance of loss to the insured that’s related to the insurance policy.

S

Safety Apparel

Clothing and accessories specifically designed to minimize bodily injury for motorcycle riders. This includes helmets, motorcycle gloves, and motorcycle jackets.

Short Rate Cancellation

When an insured cancels the insurance policy prior to the expiration date and a penalty is applied to the refund amount based on the time remaining on the policy.

Surcharge

An additional amount of money charged to a premium based on the actions of the insured such as accidents or moving violations.

T

Term

The period of time that the insurance policy is active.

Theft

The unlawful taking of your uninsured motorcycle

U

Umbrella Insurance

Extra liability insurance that provides an extra layer of security from large claims or lawsuits.

Unearned Premium

The amount of a pre-paid premium that has not yet been used to buy coverage

Uninsured and Underinsured Motorist Coverage

Provides coverage for injuries you and others suffer when you’re in an accident with an uninsured driver or a driver without adequate insurance.