When you’re shopping for insurance in CT, you might be intimidated by some of the terms used. The insurance industry has its own lingo and if you’re not accustomed to some of the terms, you might not be comfortable shopping for a policy. Here are some of the more important terms that you should know about so you can have a better understanding of your policy and what to expect if you ever need to use it.
Insurance Renewal
This term refers to the date at which your company is going to evaluate your rates. This is usually every year or every six months, and it typically concerns your auto insurance. If you have had any new traffic violations in the last year, your rates are likely going to increase on this date. Similarly, however, if you have had any traffic violations roll off your record, your rates are likely going to decrease. This is usually the best time to discuss your options with your insurance agent as well. If you aren’t happy with your rates, you can see if there are any discounts available. Otherwise, or you can start shopping around for other companies.
Gap Insurance
You’ve probably heard the term “gap insurance” before and wondered what it meant. This is an insurance policy that covers the difference between the value of your vehicle and how much you owe on it. Gap insurance is generally purchased by car owners who owe more on their car than what it’s worth. If your vehicle is involved in an accident, you are required to pay the note holder (usually the bank or finance company) the value of the vehicle. Since your normal policy doesn’t usually cover the entire cost, gap insurance is essential or else you will have to pay the finance company out of your own pocket.
Replacement Cost and Actual Cash Value
When discussing a homeowners insurance in CT policy, there are two important terms to understand: replacement cost and actual cash value. You should know the difference between these terms so you can choose the policy that’s best for you. Replacement cost refers to the price that must be paid in order to replace valuables and belongings. Actual cash value, however, takes into account depreciation for items. If your policy offers actual cash value for your belongings, you aren’t going to get as much money to replace your items following a disaster. It’s important to discuss these terms with your agent so you can choose the policy that meets your financial needs the best.
When you put the agents at Harrigan Insurance & Financial Services Inc. to work for you, we can help you find the best policy for auto, homeowners, life and more. We have been serving clients for many years and we have a great reputation in CT. Go to our website at harriganinsurancect.com today to find out more about our services.
