Auto Insurance Terms Made Simple

We created this guide to simplify some of the most common terms and phrases you’ll come across in your auto insurance policy.

Accident Forgiveness Coverage: You can purchase accident forgiveness coverage cheaply to protect your rates from rising after your first “at-fault accident”. This coverage can save you thousands over a 5-year period.

Collision Coverage: Pays to repair damage to your vehicle if you roll your vehicle, run into another car or object.

Comprehensive Coverage: Covers the cost of repairs or vehicle replacement if your vehicle is stolen or damaged in an incident that is not collision related. This coverage includes weather related damages such as fallen trees, hail, hitting a deer on the road, water or fire damage.

Depreciation Coverage: Coverage on new vehicles that waives any depreciation (you get what you paid) for a certain period of time should your vehicle be written off.

Deductible: The amount you pay on out of pocket before the insurance company will begin to cover the cost of repairs. For example, if your deducible is $1000 and you get in an accident that cost $7500 to repair. You would pay the first $1000 to the repair shop, and your insurance would cover the remaining $6500.

Excluded Driver: Identifies drivers who are not covered under your insurance policy to drive your vehicle. Typically, insurance companies will exclude a driver to lower your rates because they are high-risk.

Limit of Liability: The maximum amount of liability an insurance company can be required by law to pay for any one claim.

Multi-Policy Discount: Some insurance companies offer a discount if you have more than one policy with their company.

Multi-Vehicle Discount: Some insurance companies offer a discount for insuring more than one vehicle on the same policy.

Liability Card: A motor vehicle liability insurance card (also commonly referred to as a pink card) is a legal document designed to serve as proof of insurance.

Policy Holder: This individual name(s) on the insurance policy.

Policy Term: The period of time your policy is in effect.

Policy Premium: The amount of money you must pay for insurance during your policy term.

Rental Car Coverage: Coverage that pays for a rental vehicle while yours is being repaired should you have an at-fault collision, or comprehensive claim.

Vehicle Endorsement: A requested change in your policy, which may include removing or adding a vehicle or additional coverage.


Have any additional questions about your Ontario Auto Insurance Policy – or simply looking for a quote?

Call one of our Excalibur Defenders toll free at 1-800-361-1072.

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