Your insurance policy isn’t quite poolside reading material. It does its best to explain what you’re covered for, and everything you’re not, all in one complicated stack of papers.
The importance of understanding your insurance policy and how you’re covered cannot be overstated. The last thing you want to deal with during a loss is finding out you don’t have as much coverage as you thought. Or worse, that you don’t have any coverage at all.
We’ll be the first to admit that reading and understanding your insurance policy can be pretty challenging. That’s why we’re sharing simple explanations of the most common parts of an insurance policy.
Wondering how to read your insurance policy? Keep reading the list below.
The declarations section of your insurance policy “declares” the coverages you’ve elected and which you’ve declined. This page is usually clearly labeled “Declarations Page” or “Your Policy Declarations,” and is the first page of the policy.
Information on the declarations page includes:
- Personal information, such as your contact information and policy number.
- Policyholder information, as well as the information of anyone else insured under the policy.
- Insured property, or the property protected by the policy, as well as any pertinent information, such as a VIN number.
- Endorsements, including a schedule (list) of coverages, deductibles, limits, and premiums for each coverage. For example, if you have multiple vehicles on your auto insurance policy, this section will specify the coverages for each vehicle on the policy.
- Policy period, or the effective dates of coverage.
- Discounts applied to your premium, such as a new homebuyer discount, protective device credits, safe driver discount, etc.
- Surcharges if you’ve recently filed a claim, received a speeding ticket, or done something else to impact your premium.
The coverages section of your insurance policy breaks down the specific insurance included, such as liability coverage and loss of use coverage for homeowners insurance, or comprehensive and collision coverage for auto insurance. This section provides a more thorough explanation of what property is covered and for what damages.
This section denotes your coverage limits and what could be excluded from coverage depending on the nature of a loss.
The limits section of your insurance policy specifies how much the insurance will pay depending on the type of loss or the types of property affected. Although something is covered under your policy, it may only be covered up to a specific dollar amount or percentage of the loss.
Conditions define the insurance provider’s responsibilities, as well as your responsibilities as a customer. Details in this section include payment information, policy cancellation instructions, and more.
Duties After a Loss
Knowing how to proceed in the event of a loss can keep you safe and help the claims process run more smoothly. This section provides instructions on what to do when a loss occurs, such as contacting emergency services, notifying your insurance provider, and protecting your property from further damage.
An endorsement or rider refers to optional coverage that is offered for an additional premium. Common types of homeowners insurance endorsements include scheduled personal property coverage, building code coverage, earthquake and flood coverage, and equipment breakdown coverage.
Read Your Insurance Policy
Your insurance provider should send you a new declarations page anytime you make changes to your policy. If you’re a policyholder, you can usually obtain a copy of your insurance policy by logging into your account online. You can also contact your insurance provider to request a hard copy.
At Personal Express Insurance, we always tell our customers how important it is to read your policy and understand your coverages, but we also know it can be confusing. Our Homegrown Pros are always happy to help simplify insurance terms and break down coverages to help our customers understand how they’re protected.
Have a question about your policy? Want to know how you’re covered? Curious how Personal Express could help you find more affordable homeowners, renters, or auto insurance? Visit your local Personal Express office or call 1-800-499-3612 for more information.