Understanding Your Auto Insurance Policy

A Guide to the Terminology of your auto insurance policy: Part One

If you do not live and breathe insurance policies like our E&Y Agents do, then the terms and intricacies of any insurance policy could make your head spin. It’s our job to ensure that you have the coverage you need for your piece of mind, at a price that you can afford. That said… it’s important that you ultimately understand your policy and educate yourself. We can do our best, but education is your best security.

Here are a few key terms to help you understand your insurance policy better:


A formal and professional written declaration of the value of your property. Appraisals after an accident or from damage will be completed by an insurance adjuster or an accredited auto body specialist.

Collision Insurance:

Collision coverage pays for damage to your car that is caused by an impact with another vehicle or object, or a result of a rollover. Your collision coverage may also cover accidents to vehicles that are not your own, such as a rental or borrowed car. Look into the fine print of your collision policy.

Comprehensive Insurance:

This covers damage from an incident other than a collision (think fire, theft or vandalism). Some people may opt out of comprehensive insurance to save money on their policies. That is a discussion you should have with your E&Y Agent.


A deductible is the amount of money that you, as the policy holder, are responsible for paying before the insurance company pays for the remainder of the damage. The deductible is negotiable and will often impact your insurance rates. The higher the deductible, the lower your premium as you take on more financial risk.

Here’s how the deductible works: if the damage to your vehicle was appraised at $1,500 and you have a $500 deductible, your insurance partner would be responsible for paying $1,000 toward the repairs after you pay the $500 yourself. While it is tempting to go with the higher deductible to save you money on your policy, you need to ask yourself what you can actually afford to pay if an accident occurs. No point in having a $500 deductible if you can’t come up with that money.

Accident Forgiveness: This one’s on us. Accident forgiveness refers to a clause in your policy that would give you a pass on one at-fault accident We all make mistakes, so look for an insurance policy that recognizes this and, well, forgives you.

Liability Insurance:

In the event of an at fault accident, there may be money owing to a third-party due to bodily injuries, property damage or financial losses. Liability insurance covers you so that you don’t have to pay out of pocket.

If you want to better understand the fine print in your policy, give us a call. We love talking insurance and will make the time to talk with you about yours!

About E&Y Agency

E&Y Insurance Agents are dedicated to giving our clients insurance products that provide quality protection and value pricing. Our goal is to establish a successful partnership with our clients, our staff members, and our insurance companies. Our success is measured by our clients choosing us because they believe in our ability to meet or exceed their expectations of price, service, and expertise.

For more information about the insurance services offered at E&Y Insurance Agency, please feel free to continue browsing through our website. Also, check out our blog for more interesting content! We can be reached at 248-817-8071 or by filling out our contact form.

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