Acronyms, as annoying as they can be, are also convenient, at least for those who know what they mean. Insurance coverage is full of them. Since everyone has to buy car insurance in order to legally drive, you’ve probably already seen some of these. But what do they mean? Here are a few of the more common ones:

LI- Liability

DEFINITION of ‘Automobile Liability Insurance’ Financial protection for a driver who, while operating a vehicle, harms someone else or their property. Automobile liability insurance only covers injuries or damages to third parties and their property, not to the driver or the driver’s property.

BI- Bodily Injury

When you are found legally responsible for a car accident, bodily injury liability coverage is the part of your insurance policy that pays for the costs associated with injuries to the other person or people involved. This coverage also provides a legal defense in the event that you are sued for damages.

PD- Property Damage

Property damage liability insurance covers the cost of damages to someone else’s property after an accident you cause. Most commonly, your property damage will pay out when you are at fault for an accident that causes damage to someone else’s car.

PIP – Personal Injury Protection

Personal injury protection (PIP) is an extension of car insurance available in some U.S. states that covers medical expenses and, in some cases, lost wages and other damages. For more info, click here: PIP covers bicyclists and pedestrians

UIM/UM –  Uninsured or Underinsured Motorist Coverage

An addition to a standard automobile insurance policy that provides coverage in the event the other driver is both legally responsible for the accident and is not insured. 

ACV – Actual Cash Value

Actual cash value is the amount equal to the replacement cost minus depreciation of a damaged or stolen property at the time of the loss. It is the actual value for which the property could be sold, which is always less than what it would cost to replace it.

COMP- Comprehensive coverage

When people hear the word “comprehensive,” they might think “all-encompassing”— but in car insurance terms, the word has a different meaning. Comprehensive coverage may help protect your car against damages that are not related to a collision, such as theft, vandalism, or fire.

COLL – Collision

Collision insurance is a type of auto insurance coverage. Collision Insurance will reimburse the insured for any damage sustained to their personal automobile that is due to the fault of the insured driver. This type of insurance is often added as an extension of a basic policy.

I’ve got a YouTube channel where I answer many different questions that arise during the car insurance claims process. That can be a great place to start if you are looking to truly understand your car insurance policy or you’re just beginning the claims process after an accident.

As a personal injury attorney here in Bellingham, I recommend going over your insurance policy every year, and making sure you understand the fine print. Still have questions? I work to serve every accident victim in Whatcom County who needs help recovering. Contact Bill Coats Law through this form, call me at (360) 392-2833 or click on the chat window in the corner.

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