by Ed Sneineh

Many people refer to their insurance ID card as their auto insurance policy. Also, other individuals consider that the Policy Declaration Page is the actual policy. In these two scenarios and many other cases where people may mention certain documents of their insurance contracts, the language they use is flawed.

The actual auto policy consists of a number of written documents, printouts, and booklets that describe the people insured and what is covered, limits and conditions of coverage, exclusions and any other endorsements.

Insurance Identification (ID) Card: This is a document that is used as a legal proof of insurance coverage on a particular vehicle. The Insurance ID Card is not the policy. The use of the ID card is to show to law enforcement as a legal proof of liability coverage on a particular vehicle The ID card must show effective and expiration dates, along with the Vehicle Identification Number of the vehicle. You do not have to have all names of operators listed on the ID card for the ID card to be correct. Also, the ID Card does not have to exhibit if the policy has elective coverages such as full coverage.

POLICY DECLARATION: This is a one or 2 page documents that list certain elements such as:

(1) Name and address of insurance company,
(2) Name and address of agent,
(3) Insured's name and address ,
(4) Effective and expiration dates and time,
(5) autos covered,
(6) Coverage types, and
(7) Insurance liability limits .

Again, your declaration page is not your policy, but is part of it.

One of the most important issues in the policy declaration is the type and limits of coverage. In the State of Illinois, there are certain minimum coverages and minimum limits that must be complied with. The following are coverage you might find on an Illinois auto insurance policy:

Mandatory Coverages
A- Bodily Injury Liability: This is a mandatory limit in Illinois. This coverage comes with minimum limit of $20,000 per person, $40,000 per accident.
B- Property Damage Coverage: Another mandatory coverage in the State of Illinois with minimum limits of $15,000 per car.
C. Uninsured Motorist Bodily Injury: Also mandatory in Illinois and it provides insurance coverage for the bodily injury of insured person in the event the insured is struck by someone who turned out to be legally uninsured. The least amounts of coverage in the State  of Illinois are $20,000 per person, $40,000 per accident.

Coverages That Are Not Subject To Mandatory Insurance
Underinsured Motorist Bodily Injury. This is an optional coverage in the State of Illinois and insurance companies do not have to present this coverage unless policy limits are given beyond minimum state limits. In this case the client may decline this coverage, but in writing.
Uninsured Motorist Property Damage: If car is struck by someone who is legally uninsured, this coverage will kick in and fix the car. This coverage is inexpensive and has no value if you purchase comp and collision.
Medical Payments to Others. This coverage gives protection for medical and funeral expenses of the insured folks in the event they get involved in an vehicle crash. The coverage amount varies from none to $5,000 with nonstandard car insurers, and is offered up to $25,000 with certain preferred vehicle insurance companies.
Personal Injury Protection: Optional in Illinois but is compulsory in states that follow the no fault liability system. It provides payments for burial and medical expenses up to the limit of the policy in any event of car related accident, regardless of fault (similar to medical payment.)
Comprehensive & Collision: Although optional, this vehicle is needed if you have a loan on the insured car. It delivers protection in case of a loss to your car because of crashes, theft, water damage, fire, etc.
Towing Coverage: Provides for car towing expense in case your vehicle got into a covered loss (maintenance related problems are no covered items.)
Rental Car Coverage: Delivers limited amount of payment (ie $25 per day) for substitute transportation, for a specific number of days(ie 20 days) in the event you suffer a covered loss to your car.
Special Equipment Coverage: Optional in Illinois. It provides coverages for the extra additions that you put in your vehicles (conversions, rims, TVs, etc.)
GAP Insurance: Optional in Illinois. It provides payments for the difference of what the company pays and the amount of outstanding loan on the vehicle (the gap) in the event of total loss.

POLICY TERMS AND CONDITIONS: This section lists the definitions and provisions of your policy, your duties and responsibilities and the duties and responsibility of the insurance company. This is one of the most important parts that you need to read in order to get the best use of your policy.

EXCLUSIONS: This section will list things and scenarios that there will be no coverage under your policy. Reading this aspect very well will help you refrain from lots of heartache when filing a claim in the future.


Ed Sneineh, Chicago Auto Insurance Agent since 1989, former college educator of insurance, & founder of Chicago based Insurance Navy, a leader in providing affordable  automotive insurance
Posted 12:45 AM  View Comments

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