Vocabulary
Glossary
Definitions written for Florida drivers choosing, renewing or comparing an auto insurance policy. Each term links back to the guides where it matters.
- Actual cash value (ACV)
- What your car was worth immediately before a loss—replacement cost minus depreciation. Total loss settlements are paid at ACV.
- Binding restriction
- An insurer's temporary freeze on new policies and coverage increases in areas under a storm watch or warning.
- Bodily injury liability (BI)
- Coverage that pays for injuries you cause to others. Not required for most Florida drivers, but required after a DUI (100/300) and strongly recommended for everyone.
- Collision coverage
- Pays to repair or replace your car after a crash, regardless of fault, minus your deductible.
- Comprehensive coverage
- Pays for non-crash damage to your car: theft, vandalism, fire, flood, hurricane debris, hail, animal strikes and glass. The coverage that responds to Florida storm damage.
- Deductible
- The amount you pay before collision or comprehensive pays. Higher deductibles lower premiums, with larger dollar savings on Florida's high base rates.
- Financial responsibility
- The legal obligation to be able to pay for damage you cause while driving, satisfied by insurance meeting state requirements.
- FR-44
- Florida's certificate of financial responsibility required after a DUI. Requires 100/300 bodily injury and $50,000 property damage liability for three years.
- Full coverage
- Informal term for a policy that includes liability and PIP plus collision and comprehensive for your own car.
- High-risk driver
- An insurer's classification for a driver whose record predicts above-average claims—accidents, violations, a DUI or a coverage lapse.
- Medical payments coverage (MedPay)
- Optional coverage that pays the 20% of medical bills Florida PIP does not cover, and medical costs above the PIP limit.
- No-fault insurance
- A system in which each driver's own insurer pays for their initial injury costs regardless of who caused the crash. Florida is one of about a dozen no-fault states.
- Non-owner policy
- Liability coverage for a driver who does not own a car. Can carry an FR-44 or SR-22 filing.
- Non-standard insurance
- The part of the market that specialises in high-risk drivers. Non-standard insurers provide FR-44 and SR-22 filings and non-owner policies.
- Permanency (tort) threshold
- The standard an injured person must meet in Florida to sue an at-fault driver for pain and suffering: permanent injury, significant scarring or disfigurement, or death.
- Personal injury protection (PIP)
- Florida's required no-fault coverage. Pays 80% of your medical expenses and 60% of lost wages after a crash, regardless of fault, up to $10,000.
- Premium
- The price you pay for a policy, usually quoted per six or twelve months.
- Property damage liability (PDL)
- Required Florida coverage that pays for damage you cause to other people's property. The state minimum is $10,000 per accident.
- Rating factor
- Any characteristic an insurer uses to set your premium: territory, age, record, vehicle, mileage, credit-based score, coverage choices.
- Rating territory
- A geographic area—usually a group of ZIP codes—for which an insurer sets base rates from local claims experience.
- SR-22
- A filing proving you carry at least Florida's minimum liability coverage, required after certain non-DUI violations such as driving uninsured. Lower limits than the FR-44.
- Stacked UM
- An option that multiplies your UM limit by the number of vehicles on the policy. Two cars with 100/300 stacked UM give $200,000 per person.
- Surcharge
- A percentage added to a premium for a violation or at-fault accident, typically for three years.
- Telematics (usage-based insurance)
- Programmes that price your policy partly on measured driving behaviour—braking, speed, mileage, time of day—via an app or device.
- Total loss
- A vehicle the insurer decides to pay out rather than repair, usually because repair cost approaches its value. Flooded cars are routinely total losses.
- Uninsured/underinsured motorist (UM) coverage
- Pays for your injuries when the at-fault driver has no insurance or too little. Florida insurers must offer it at your BI limits unless you reject it in writing.