Expiration Date

The date and time that your coverage ceases. Normally, the time is 12:01 AM - meaning one minute after midnight.

Financial Ratings

This term refers to the credit-worthiness and financial stability of insurance companies. AM Best, Standard & Poor's, and Moody's are the three agencies that assign financial ratings to insurance companies.

Financial Responsibility Laws

Each state requires motorists to be financially able to compensate the victims of bodily or property damage for which they are liable. Liability insurance is the easiest way to meet these requirements, however, those who can afford to do so may opt to post bonds instead.

Full Coverage Car Insurance

This is a confusing term. Many people think that having "full coverage" means that they will be covered no matter what happens to them. In reality, it only means that you have the full legal requirements needed in your state. Depending on your home state, it could be very little coverage in reality.

Gap Insurance

Optional coverage for the difference in the amount owed on a vehicle and its replacement value. For example, if your car's replacement value is $4,000, but you still owe $5,000 on it and it's totaled, your insurance company will only pay you $4,000 (unless you have gap insurance).

Garaging Location

It is assumed by car insurance companies that you keep your car at your home address. However, if you primarily keep your car in a different location, make sure your insurance company knows. It can affect your rates.

Good Student Discount

Most insurers provide discounts to high school students who receive good grades. The reasoning behind this discount is that insurers have found that students who are responsible enough to get good grades are generally more responsible drivers, and thus they pose less risk for the insurers.

Insurance Premium

Rates charged to an insured, reflecting the insurer's expectations for loss and adding in an element of profit. Premiums are typically paid monthly, but discounts are often offered for paying in advance, either quarterly, semiannually, or yearly.

Insurance Score

Score given to each insurance customer, based on complex statistical models, in order to determine his or her insurance risk. The better your insurance score, the lower car insurance rates you can expect to pay.

Judgment

A decision by a court of law, typically ordering one party to pay another party a sum of money. Additional legal action is normally required in order to ensure that judgments are enforced.