Kentucky Auto Insurance Regulations
Kentucky Office of Insurance
Facts About Automobile and Homeowners / Renters Insurance
Auto and homeowners insurance terms you need to know:
Actual Cash Value (ACV) - What an item was worth at the time it was damaged or stolen.
Additional Living Expenses - Pays costs above your normal expenses if your home is damaged by
an insured event to the extent that you cannot live there while repairs are being made.
Bodily Injury Liability - Coverage for claims made against you for injury/death of others caused
by your negligence.
Collision - Covers damage to your vehicle when it is involved in an accident or collides with
something. Collision does not cover injuries to people or damage to property other than your
covered vehicle. If your vehicle is financed, most lenders will require collision coverage to protect
its interest.
Comprehensive Coverage - Covers damage to your vehicle due to perils other than collision.
Comprehensive perils include fire, theft, vandalism, flood, falling objects and colliding with a bird
or animal.
Contents - Coverage for personal property that is movable such as televisions, radios, clothes and
household items.
Deductible - Amount for damages you must pay before your insurance company begins paying.
Dwelling - A permanent structure with walls and a roof. Most dwellings also include plumbing,
wiring, and heating and air conditioning equipment. Other basic equipment such as fire extin-
guishers, snow shovels, lawn mowers and so forth, which are used to service the dwelling and
surrounding land, are covered as personal property and are not considered as part of the dwelling
in a homeowners policy.
Exclusion - A contract term referring specifically to property, people, situations or items not cov-
ered by your policy.
No-Fault - Basic no-fault coverage provides up to $10,000 to each occupant in your vehicle for
medical expenses, lost wages and similar out-of-pocket costs due to an injury occurring in an
automobile accident.
Perils - Events that cause damage to property such as fire, windstorm and theft.
Policy Limit - The maximum amount that the insurance company will pay on any covered loss.
Property Damage Liability - Coverage for damage or destruction to another persons property
caused by your negligence.
Replacement Cost (RCV) - What it will cost to replace an item.
Underinsured Motorist (UIM) - Coverage for bodily injuries sustained by you and/or your passen-
ger that exceed the limits of the responsible partys policy.
Uninsured Motorist (UM) - Coverage for bodily injuries sustained by you and/or your passenger
in an accident caused by the negligence of a driver who had no insurance or by a hit-and-run
driver.
Automobile Insurance
Tips for reducing your auto insurance rates:
·
Be a comparison shopper - Shop around with different companies; you may be surprised at
the differences in costs.
·
Raise your deductible - This lowers the cost of your premiums.
·
Limit your claims - Your claim history may affect your premium cost.
·
Decrease your risk of loss - Dont leave valuables in the car. Lock your car doors and never
leave your car running while unattended.
·
Ask about discounts - For example, install anti-theft devices or attend drivers education
classes. Many companies will offer a discount if you have your auto and homeowners (or
renters) insurance with them.
·
Annually review your policy limits and the value of the vehicle(s) you have insured.
·
Check out rates before buying a car - Consider buying a low profile or family car instead of a
high-performance vehicle.
·
Review your credit report - Most companies consider your credit history when determining
premiums.
In Kentucky, the law requires the owner of a vehicle
paid timely, the coverage will end. If paying the entire
to carry at least $25,000 for bodily injury liability
premium amount at once is difficult, most insurers
per person in an accident, $50,000 for all bodily
offer a payment plan.
injuries per accident, and $10,000 for property
damage per accident. This is sometimes referred to
Through investigations, the Kentucky Office of Insur-
as 25/50/10. You must show proof of coverage each
ance has uncovered individuals selling fraudulent
time your vehicle registration is due for renewal.
insurance cards for proof of auto liability insurance.
Your auto insurance card is required to be carried in
Often the cost of this fake card has exceeded the cost of
your vehicle at all times.
legally purchased auto insurance. If you are unsure if
the coverage you are purchasing is legitimate, please
Auto insurance does not contain a grace period for
contact our Consumer Protection Division at (800) 595-
making premium payments. If the premium is not
6053, and select option 1.
Homeowners / Renters Insurance
If you rent a house, apartment or a condominium, you should purchase a renters insurance policy
on your belongings. The landlords insurance covers damage to the building but not your posses-
sions. Also, most renters policies include personal liability coverage in case someone is injured
due to negligence on the landlords property.
All homeowners or renters policies include a deductible. The deducible is the amount you will be
responsible for paying for a covered loss before the insurance company begins to pay. When
purchasing a policy, you should pick a deductible that fits your budget.
Your premium will depend on the insurance company, where you live, the deductible you choose,
if claims will be paid on an ACV or RCV basis and any additional coverages you purchase. Be sure
to ask about any discounts such as deadbolt locks or smoke alarms.
Fire Hazards
Extension cords, decorative candles and space heaters all have their usefulness. Unfortunately,
many fires occur because these items are used improperly or are left unattended. To be safe, never
place a burning candle near any object that can catch fire, always keep them out of reach of chil-
dren and/or pets and never leave burning candles unattended.
Misuse, overuse, faulty or damaged extension cords are dangerous. Minimize your use of exten-
sion cords and never use an extension cord or appliance with a damaged cord. If a cord becomes
too hot to the touch, stop using it immediately.
Kentucky Office of Insurance
Consumer Protection & Education Division
P.O. Box 517, Frankfort, KY 40602-0517
Toll free: 1-800-595-6053 TTY (deaf/hard-of-hearing): 1-800-462-2081
http://doi.ppr.ky.gov/kentucky/
The Kentucky Office of Insurance does not discriminate on the basis of race, color, religion, sex, national
origin, sexual orientation or gender identity, ancestry, age, disability or veteran status. The Office provides,
upon request, reasonable accommodation, including auxiliary aids and services necessary to afford an indi-
vidual with a disability an equal opportunity to participate in services, programs and activities.
Printed with state funds on recycled paper
January 2005
Facts About Automobile and Homeowners / Renters Insurance
Auto and homeowners insurance terms you need to know:
Actual Cash Value (ACV) - What an item was worth at the time it was damaged or stolen.
Additional Living Expenses - Pays costs above your normal expenses if your home is damaged by
an insured event to the extent that you cannot live there while repairs are being made.
Bodily Injury Liability - Coverage for claims made against you for injury/death of others caused
by your negligence.
Collision - Covers damage to your vehicle when it is involved in an accident or collides with
something. Collision does not cover injuries to people or damage to property other than your
covered vehicle. If your vehicle is financed, most lenders will require collision coverage to protect
its interest.
Comprehensive Coverage - Covers damage to your vehicle due to perils other than collision.
Comprehensive perils include fire, theft, vandalism, flood, falling objects and colliding with a bird
or animal.
Contents - Coverage for personal property that is movable such as televisions, radios, clothes and
household items.
Deductible - Amount for damages you must pay before your insurance company begins paying.
Dwelling - A permanent structure with walls and a roof. Most dwellings also include plumbing,
wiring, and heating and air conditioning equipment. Other basic equipment such as fire extin-
guishers, snow shovels, lawn mowers and so forth, which are used to service the dwelling and
surrounding land, are covered as personal property and are not considered as part of the dwelling
in a homeowners policy.
Exclusion - A contract term referring specifically to property, people, situations or items not cov-
ered by your policy.
No-Fault - Basic no-fault coverage provides up to $10,000 to each occupant in your vehicle for
medical expenses, lost wages and similar out-of-pocket costs due to an injury occurring in an
automobile accident.
Perils - Events that cause damage to property such as fire, windstorm and theft.
Policy Limit - The maximum amount that the insurance company will pay on any covered loss.
Property Damage Liability - Coverage for damage or destruction to another persons property
caused by your negligence.
Replacement Cost (RCV) - What it will cost to replace an item.
Underinsured Motorist (UIM) - Coverage for bodily injuries sustained by you and/or your passen-
ger that exceed the limits of the responsible partys policy.
Uninsured Motorist (UM) - Coverage for bodily injuries sustained by you and/or your passenger
in an accident caused by the negligence of a driver who had no insurance or by a hit-and-run
driver.
Automobile Insurance
Tips for reducing your auto insurance rates:
·
Be a comparison shopper - Shop around with different companies; you may be surprised at
the differences in costs.
·
Raise your deductible - This lowers the cost of your premiums.
·
Limit your claims - Your claim history may affect your premium cost.
·
Decrease your risk of loss - Dont leave valuables in the car. Lock your car doors and never
leave your car running while unattended.
·
Ask about discounts - For example, install anti-theft devices or attend drivers education
classes. Many companies will offer a discount if you have your auto and homeowners (or
renters) insurance with them.
·
Annually review your policy limits and the value of the vehicle(s) you have insured.
·
Check out rates before buying a car - Consider buying a low profile or family car instead of a
high-performance vehicle.
·
Review your credit report - Most companies consider your credit history when determining
premiums.
In Kentucky, the law requires the owner of a vehicle
paid timely, the coverage will end. If paying the entire
to carry at least $25,000 for bodily injury liability
premium amount at once is difficult, most insurers
per person in an accident, $50,000 for all bodily
offer a payment plan.
injuries per accident, and $10,000 for property
damage per accident. This is sometimes referred to
Through investigations, the Kentucky Office of Insur-
as 25/50/10. You must show proof of coverage each
ance has uncovered individuals selling fraudulent
time your vehicle registration is due for renewal.
insurance cards for proof of auto liability insurance.
Your auto insurance card is required to be carried in
Often the cost of this fake card has exceeded the cost of
your vehicle at all times.
legally purchased auto insurance. If you are unsure if
the coverage you are purchasing is legitimate, please
Auto insurance does not contain a grace period for
contact our Consumer Protection Division at (800) 595-
making premium payments. If the premium is not
6053, and select option 1.
Homeowners / Renters Insurance
If you rent a house, apartment or a condominium, you should purchase a renters insurance policy
on your belongings. The landlords insurance covers damage to the building but not your posses-
sions. Also, most renters policies include personal liability coverage in case someone is injured
due to negligence on the landlords property.
All homeowners or renters policies include a deductible. The deducible is the amount you will be
responsible for paying for a covered loss before the insurance company begins to pay. When
purchasing a policy, you should pick a deductible that fits your budget.
Your premium will depend on the insurance company, where you live, the deductible you choose,
if claims will be paid on an ACV or RCV basis and any additional coverages you purchase. Be sure
to ask about any discounts such as deadbolt locks or smoke alarms.
Fire Hazards
Extension cords, decorative candles and space heaters all have their usefulness. Unfortunately,
many fires occur because these items are used improperly or are left unattended. To be safe, never
place a burning candle near any object that can catch fire, always keep them out of reach of chil-
dren and/or pets and never leave burning candles unattended.
Misuse, overuse, faulty or damaged extension cords are dangerous. Minimize your use of exten-
sion cords and never use an extension cord or appliance with a damaged cord. If a cord becomes
too hot to the touch, stop using it immediately.
Kentucky Office of Insurance
Consumer Protection & Education Division
P.O. Box 517, Frankfort, KY 40602-0517
Toll free: 1-800-595-6053 TTY (deaf/hard-of-hearing): 1-800-462-2081
http://doi.ppr.ky.gov/kentucky/
The Kentucky Office of Insurance does not discriminate on the basis of race, color, religion, sex, national
origin, sexual orientation or gender identity, ancestry, age, disability or veteran status. The Office provides,
upon request, reasonable accommodation, including auxiliary aids and services necessary to afford an indi-
vidual with a disability an equal opportunity to participate in services, programs and activities.
Printed with state funds on recycled paper
January 2005