Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insurance...

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Reviewed by Leslie Kasperowicz
Farmers Insurance CSR 4 Years

UPDATED: Jul 14, 2021

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Here's what you need to know...

  • It is important for drivers to understand their auto insurance policies
  • A copy of their policy should be provided by their auto insurance carrier
  • An auto insurance policy is a legal document
  • The policy will provide their personal information as well as different coverages they have elected and the exclusions

Many drivers simply never bother to look at or read through a copy of their auto insurance policy. However, whether you receive this important document electronically or on paper, it is wise to be familiar with it. If for nothing else, you should be informed regarding what you are paying for.

If, after reading your auto insurance policy, you feel you are currently paying too much, consider using an online auto insurance price comparison tool. These convenient tools make it easy to compare different policies and prices all on one electronic platform.

Start comparison shopping today by entering your zip code in our FREE tool!

What is an auto insurance policy?

Your auto insurance policy is a legal contract. Many drivers find their policy to be confusing or even overwhelming. However, the more drivers can understand their policy and be informed, the better off they will be. Each auto insurance policy consists of three different parts:

Declarations Page

This page is where you will find general information regarding your auto policy such as your name, the coverage period of the policy, vehicle identification numbers (VIN), make, model, and year of the vehicle, and the amount of your premium.

It also provides you with a description of your coverages and the maximum dollar amount that the insurance carrier will pay out for each type of claim.

You should check over the information on your declarations page carefully to be sure everything is correct. If you miss something that is incorrect, such as a VIN, you could have a claim denied.

Insuring Agreement/Coverage Types

This part of the policy is the most important and one that drivers should spend some time familiarizing themselves with. The insuring agreement explains the insurance company’s obligations to the driver for the premium that they are paying. It will also say who is covered if there are other drivers on your policy such as a spouse, child, or roommate.

This section is where everything about the policy is explained in order to avoid any misunderstandings about either party’s obligation to one another, which will include a list of definitions and a list of exclusions to each type of coverage.

The exclusions section highlights what you do not have coverage for and reveals additional coverages you might want to consider adding. In the unfortunate event that you need to use your coverage, it is important to know these pieces of information.

Conditions of the Policy

The final section of an auto insurance policy explains the driver’s responsibilities if a claim arises. It spells out how much time you have to report the claim to the insurance company and what documentation you must provide.

It also tells the driver the terms of canceling the policy, whether it is done by the car insurance carrier or the policyholder. As the consumer, you have the right to cancel the policy at any time.

On the other hand, your insurance carrier may only cancel under certain conditions and with an advance notice to the policyholder.

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How do I get a copy of my auto insurance policy?

A hard copy of your auto insurance policy should be mailed to you by your insurance carrier at or before the policy’s commencement date.

Some auto insurance companies will also email you this document or provide you with access to it via their own website. If you do not have a copy of your policy or know where to find it, contact your auto insurance carrier.

Auto Policy Coverages

Within the insuring agreement of your auto policy, your policy components will be listed. Your auto insurance policy is more like several smaller policies as each covers different types of circumstances and damages. It is vital that drivers understand which types they have elected and what they are covered for. Coverage types include:


This is the minimum amount of car insurance coverage a driver can purchase and is legally required by most states. Bodily injury liability covers physical damages you may cause to another party while property damage liability covers costs to repair or replace property you have caused damages to.

Uninsured/Underinsured Motorist

If you are hit by another driver who does not have insurance or does not have adequate amounts of insurance, this type of coverage can help provide for the expenses you face. In some states, this coverage is a legal requirement.


If your car is damaged or lost as a result of something other than a collision, the comprehensive piece of your policy will likely cover it. Comprehensive covers theft, vandalism, hail, fire, flood, hitting wildlife, explosions, and falling objects.


If your car collides with another car or object such as a building, your claim will fall under the optional coverage piece of collision.

Medical Payments

Some states require drivers to have medical payments coverage. This is a primary coverage for medical expenses for you and your passengers if you are hurt in an accident, no matter who is at fault.

Drivers who ensure they understand their auto insurance policy and that all the information is correct on it are making their money work harder for them.

By doing so, you may choose to add more coverage to have better protection or to drop some types of coverages you do not feel are necessary.

Either way, if you are paying too much for your auto insurance policy, use an online auto insurance price comparison tool today to put more money back in your pocket. Enter your zip code into our FREE tool to get started!