Commercial Auto Insurance Terms

Found a word that you don't know? With so many specific terms, insurance can sometimes seem like its own language. Let us decode it for you with our handy glossary.


An accident is a sudden, unexpected event or occurrence that causes bodily injury or property damage. The event may be at-fault, not-at-fault, reported or unreported. An example of a not-at-fault accident could be where your parked vehicle is struck by another vehicle.

Actual cash value (ACV)

A vehicle's actual cash value, also called the market value, is essentially the price someone would pay to purchase that exact vehicle today. It's determined by evaluating a number of factors, including the vehicle's age and condition, as well as any prior damage, improvements, or special equipment.

Additional insured

A company or person who may be liable for an accident that involves an insured person or vehicle can be added to the policy as an additional insured.

Example: A general contractor can be an additional insured.

Anti-theft device

A device, either active or passive, that attempts to prevent vehicle theft. Active anti-theft devices can track and recover a vehicle and automatically contact a response center to begin the vehicle recovery process. Passive anti-theft devices attempt to prevent theft by using sophisticated electronic car alarms, simple steering wheel locks, etc.

Any auto coverage

Any Auto coverage extends Liability insurance to hired and other non-owned vehicles, and vehicles you purchase during your policy term. It extends the same Liability coverage and limits you carry for the vehicles already listed on your policy to the unlisted vehicles. Any Auto coverage requires a contractual agreement stating the need for the coverage. Other restrictions could apply.

Learn more about Any Auto coverage.

Bobtail coverage

Although Bobtail coverage is often used interchangeably with Non-Trucking Liability coverage, technically they are not the same thing. Bobtail insurance protects a tractor when it's operated without a trailer, whether or not it's under dispatch, while Non-Trucking Liability coverage only covers a vehicle when it's driven for personal, nonbusiness use.

Learn more about Non-Trucking Liability insurance.

Bodily injury liability coverage (BI)

Bodily Injury Liability is one part of Liability Coverage. If you are responsible for causing an accident, Bodily Injury Liability coverage pays for injuries/death to people involved in the accident. Bodily Injury Liability coverage also pays for legal defense costs if you are sued.

Learn more about Bodily Injury Liability insurance.

Combined single limit (CSL)

CSL is a single number that describes the predetermined limit for the combined total of the Bodily Injury Liability coverage and Property Damage Liability coverage per occurrence or accident.

Example: A CSL of $1 million pays up to a combined total of $1 million for both Bodily Injury Liability coverage and Property Damage Liability coverage for any single accident.

Commercial driver's license (CDL)

A CDL is a special license needed by operators of tractors, vehicles over 26,000 GVW, or vehicles carrying more than seven passengers.

Commercial vehicle

A commercial vehicle is any vehicle used for business purposes. Also called commercial auto, corporate car, corporate vehicle, business auto, business car or business vehicle.

Comprehensive coverage

If your insured vehicle is damaged due to an event other than a collision, Comprehensive coverage will pay for the damage. This includes damages from fire, theft, windstorm, flood and vandalism.

Learn more about Comprehensive insurance.

Comprehensive coverage with full glass protection

If you need to replace a window or windshield due to a non-collision incident, Comprehensive coverage with Full Glass Protection pays to replace it and waives the standard deductible, which you would usually have to pay out of pocket. This coverage is not available in all states.

Collision coverage

When your insured vehicle overturns or collides with another object, Collision coverage pays for the damage to your vehicle.

Learn more about Collision insurance.

Continuously insured

Being continuously insured means your insurance coverage was in effect at all times, without a break or lapse in coverage for any reason.


A corporation is created to function as a separate legal and tax entity, independent of the people who own and manage it. It can enter agreements, incur debts and be taxed apart from its owners. A corporation is required to file articles of incorporation with its home state, create corporate by-laws, issue stock certificates and comply with a number of corporate formalities.


Coverage is the word used to describe protection for an insured as provided by an insurance policy. A particular coverage may refer to a specific component of insurance that provides protection under a given set of circumstances.

Custom harvesters

People who travel from home, working a few weeks at a time at various locations harvesting seasonal crops, are custom harvesters. They sometimes also are called agricultural workers or migrant workers.

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Sometimes also called "Bobtail coverage." Although Bobtail or Deadhead coverage is often used interchangeably with Non-Trucking Liability coverage, technically it is not the same thing. Bobtail insurance covers a tractor when it's operated without a trailer, whether or not it's under dispatch, while Non-Trucking Liability coverage only covers a vehicle when it's driven for personal, nonbusiness use.

Declarations page (Dec Page)

Also known as an auto insurance coverage summary, this page is provided by your insurance company and lists the following:

  • Types of coverage you have elected
  • Limit for each coverage
  • Cost for each coverage
  • Specified vehicles covered by the policy
  • Types of coverage for each vehicle covered by the policy, and
  • Other information applicable to the policy


A deductible is the dollar amount you agree to pay out of pocket for damage resulting from a specific loss or accident. Deductibles always are selected when you purchase an insurance policy.

Diplomatic driver's license

A diplomatic driver's license is issued to members of foreign consular posts and their family members in the United States. Diplomatic driver's licenses can only be issued by the Department of State through its Diplomatic Motor Vehicle Office.


A discount is a percentage reduction applied to a premium for fulfilling specific requirements or actions.

Doing business as (DBA) name

A DBA is a name by which a company is known to the public but which is not its legal name.

Electronic funds transfer (EFT)

EFT is a payment method in which funds are automatically deducted from a customer's checking account to pay bills on a regularly scheduled basis. Customers must select the EFT payment method and authorize payments in advance to use this system to pay their bills.

Employer's non-owned coverage

Employer's Non-Owned coverage provides Liability insurance for a vehicle owned by your employee if it must be used to conduct your business. This coverage is for vehicles that are not regularly used for the business.

Learn more about Employer's Non-Owned coverage.


A filing is like a certificate of insurance issued by an insurer that provides proof of specific insurance coverage. There are both federal filings and state filings.

Federal filings are submitted to the Federal Highway Administration. They often are required for interstate transportation of goods, people or hazardous materials.

State filings are submitted to a specific state's Department of Transportation or other governing body. They often are required for intrastate transportation of goods, people or hazardous materials.

Learn more about commercial auto insurance filings.

Federal highway administration (FHWA)

The FHWA is a branch of the federal government that regulates interstate transportation of goods and people.

Fire and theft with combined additional coverages

The damage or loss must be caused by one of the following: fire, lightning, explosion, theft, windstorms, hail, earthquakes, flood, rising waters, vandalism, a collision with an animal, or while being transported by a third party.

Learn more about Fire and Theft with Combined Additional Coverages.

For-hire truckers

For-hire truckers are truck operators who transport goods for a fee.

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Garagekeepers legal liability insurance

Garage Keeper's Legal Liability coverage was designed for towing businesses. It protects your customers' vehicles in case of fire, explosion, theft, vandalism or collision when the vehicle is at your garage or covered location for servicing, parking or storing.

Learn more about Garage Keeper's Legal Liability insurance.

Garaging location

A garaging location is the place you primarily park your vehicle when you're not using it. Generally, this is your primary business address.

Gross vehicle weight (GVW)

GVW is the total weight capacity of a fully loaded vehicle. It can be calculated by adding the weight of the vehicle to the maximum weight of a load that could be carried in the vehicle. GVW can be obtained by checking the manufacturer's general information for the vehicle.

Hired auto coverage

Hired Auto coverage provides Liability coverage for a non-owned, unlisted vehicle that you have leased, hired, rented or borrowed.

Learn more about Hired Auto coverage.

Individual named insured endorsement

This coverage extends your Liability and Physical Damage coverages to other non-owned private passenger-type autos that you, or a resident relative, might drive.

This coverage is for vehicles that are not available for your regular use, and that are not owned by you, your spouse or any resident of your household. This coverage is available only to individual named insureds, and not to corporations or partnerships.

Learn more about Individual Named Insured endorsements.


If you cross the border of one state into another state, that is interstate travel.


If you stay within the borders of one state, that is intrastate travel.

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A lease is a contract or arrangement in which the use of equipment, such as a vehicle, is granted for a specified time at a specified price.

Liability coverage

Liability coverage provides protection against your legal liability for Bodily Injury and/or Property Damage caused by the negligence of your employees or yourself in the operation or use of your insured motor vehicle. This coverage also provides you with legal defense costs in the event you are sued as a result of an accident.

Learn more about Liability insurance.

Limited liability company (LLC)

A Limited Liability Company combines the personal liability protections of a corporation and the pass-through tax benefits of a partnership or sole proprietorship. Owners of LLCs typically are called members and share equally in the management responsibilities of the company. LLCs may also choose to appoint certain owners or outside personnel to manage business operations.


An insurance coverage limit is selected by you at the time you purchase a policy. It describes the maximum an insurance company will pay for damages or injuries that apply to a specific coverage. Most states have laws that specify the minimum limit that must be purchased for each required insurance coverage.

Liability coverage limits can be described as a combined single limit (CSL) or as a split limit.

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Medical payments (MedPay) coverage

MedPay is an optional insurance coverage that pays for reasonable and necessary medical and funeral expenses for covered persons. These expenses must be incurred as a result of an auto accident.

Learn more about Medical Payments (MedPay) insurance.

Minimum limit

A minimum limit is the least amount of insurance coverage required by state law. Sometimes also called statutory limits, minimum limit requirements or basic limits.

Named insured

The named insured is the name of the business or person who owns the insurance policy.

Non-trucking liability coverage

If you're under permanent lease to a motor carrier that provides your Primary Liability coverage, you could benefit from our Non-Trucking Liability (NTL) coverage with unlimited radius while using your truck for a personal non-business purpose.

Non-Trucking Liability insurance can pay for medical and associated expenses for injuries or even death that you cause to other people or for any damage caused to other peoples' property. Non-Trucking Liability insurance provides liability coverage for the truck when it's used for personal use only, such as when you are at home on your day off and use the truck to go to the movies, pick up groceries or to visit a friend. This endorsement only modifies the liability portion of your policy.

NTL does not provide liability coverage for any use that can be considered business use or to carry cargo. Trips to and from the terminal, fueling up, trips for maintenance or vehicle servicing, use during layovers, dead-heading (driving without a load), and even getting the truck washed may be considered using the auto for a business purpose. Business use would be covered by the motor carrier’s primary liability insurance.

Learn more about Non-Trucking Liability insurance.

Non-owned vehicle insurance

Non-Owned Vehicle insurance extends the coverage provided under the Bodily Injury Liability coverage and Property Damage Liability coverage of your policy to any vehicles not owned by you or your business that are used by any of your employees for business.

Learn more about Non-Owned Vehicle insurance.

Occasional driver

A person who is not the primary or principal driver of an insured vehicle is an occasional driver.

On-hook towing coverage

On-Hook Towing Liability coverage provides physical damage coverage for a customer's auto or watercraft while you are towing it. The protection includes damage caused by fire, theft, explosion, vandalism or a collision.

Learn more about On-Hook Towing insurance.

Owner operator

A truck driver who works as an independent carrier of goods instead of as an employee of one trucking company is an owner operator. The term can also be hyphenated and written as "owner-operator."

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Partnerships are frequently composed of groups of professionals, such as attorneys, accountants and lawyers, but may also be retail and service businesses.

Permanently attached equipment (PAE)

Equipment that is used in the course of doing business and is bolted or welded to an insured vehicle or trailer is permanently attached equipment. Examples of PAE include:

  • Air compressors
  • Carpet cleaning equipment
  • Computers
  • Cranes
  • Generators
  • GPS units (mounted in vehicle)
  • Ladder racks
  • Lift gates
  • Lift kits
  • Logging equipment
  • Pressure washers
  • Shelving
  • Snow plows
  • Tool boxes

Equipment that is attached to the vehicle and makes the vehicle what it is, such as buckets, cement mixers, dump boxes, refrigerated boxes, etc., are not considered permanently attached equipment. Permanently attached equipment should be included when calculating the value of the vehicle for your stated amount.

Personal injury protection (PIP) coverage

Personal Injury Protection is the basic coverage implemented in no-fault automobile insurance states. PIP is a coverage in which the auto insurance company pays, within the specified limits, the medical, hospital and funeral expenses of the insured person, people in the insured vehicle and pedestrians struck by the insured vehicle. Depending on the state, PIP may also cover lost wages and additional expenses.

Physical damage coverage

Physical Damage coverage is designed to protect your vehicle. There are several forms of Physical Damage Coverage, including Collision coverage, Comprehensive coverage and Fire and Theft with Combined Additional Coverages.

Learn more about Physical Damage insurance.


A placard is a metal plaque or other form of signage found on vehicles or trucks that displays a message to the public regarding the cargo being hauled, such as hazardous, flammable or explosive.

Policy expiration date

Your current insurance policy ends on your policy expiration date, which is found on your current policy documents, Declarations Page (Dec Page), insurance identification card or recent cancellation notice. This date should not be confused with payment due dates.

It's also important to note that in many cases, the policy actually expires just after midnight at 12:01 a.m. on the policy expiration date. This means that as of 12:02 a.m., there is no coverage.

Policy term

The length of time your policy is active and in force is your policy term.


A premium is the amount of money paid to an insurance company in return for insurance protection.

Primary address

A primary address is the place where you would like all communications mailed. This is typically your business headquarters.

Primary liability insurance

Primary Liability insurance is Liability coverage for all trucking situations including empty and loaded vehicles.

Primary use

Primary use is how you mainly use your vehicle. Primary use options include:

  • Business use only
  • Personal use only
  • Personal and business use
  • Nonbusiness use

Principal driver

The person who drives the car most often is the principal driver.

Property damage liability coverage (PD)

Property Damage Liability is the second part of Liability Coverage. If an insured person is legally liable for an accident, Property Damage Liability coverage pays for damage to others' property resulting from the accident. Property Damage Liability coverage also pays for legal defense costs if you are sued.

Learn more about Property Damage Liability insurance.

Radius of operation

The maximum distance traveled one way, as the crow flies, by an insured, from the point of garaging to the point of delivery, is the radius of operation. Depending on your state, Progressive has a 300- or 500-mile limit on radius of operation for certain types of businesses.

Repair plates

Repair plates are license plates issued to businesses that repair, alter, recondition, equip or tow motor vehicles or trailers for the public. The plates are not assigned to a specific vehicle, which makes them unacceptable for insuring with Progressive.


Repossession is reclaiming ownership of an item, such as a vehicle, because payments have not been made. Towing companies may perform auto repossession work for-hire. Progressive cannot insure towing companies that earn more than 25 percent of their income from repossession work.

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Single deductible endorsement

The Single Deductible Endorsement is automatically applied to all vehicles with Physical Damage coverage. Instead, you are only obligated to pay the highest deductible, while the others are waived. The Single Deductible Endorsement is automatically applied to all.

Learn more about Single Deductible Endorsements.

Sole proprietorship

A sole proprietorship is a one-owner company that is not registered with the state as an LLC or corporation. The owner of a sole proprietorship is personally responsible for the debts and liabilities of the company and reports the company's losses and profits on his or her personal taxes.

Split limits

A series of three numbers (ex. $15,000/$30,000/$10,000), split limits describe the predetermined maximum amounts to be paid on Bodily Injury Liability coverage and Property Damage Liability coverage per person and per occurrence or accident.

Example: A split limit of $15,000/$30,000/$10,000 would pay out, per accident, up to $15,000 in Bodily Injury Liability coverage for each covered person injured in the accident and up to a maximum total of $30,000 for all covered people injured in the accident. It also would pay out up to $10,000 in Property Damage Liability coverage.

Stated amount

A stated amount is the value submitted by the insured as representative of the current value of an insured vehicle, after accounting for depreciation and including the value of any special or permanently attached equipment.

Learn more about stated amount and how Progressive uses it.

Trailer interchange agreement

A trailer interchange agreement is a written contract between truckers or trucking companies that provides for the loan of trailers by the owner to a third party.

Example: Joe's Trucking Company has a trailer interchange agreement with Sue's Trucking Company. Joe hauls a trailer full of cargo from point A to point B. Sue takes Joe's trailer and hauls it from point B to point C for Joe.

Trailer interchange coverage

Trailer Interchange coverage provides Physical Damage insurance for trailers that you do not own while they are in your care, custody or control, such as being hauled under a trailer interchange agreement.

Learn more about Trailer Interchange insurance.

Uninsured motorist coverage (UM)

If a driver or owner of a vehicle does not have insurance and is legally liable for an accident, you can use UM coverage for injuries, including death, that you, your resident relatives and occupants of your insured vehicle sustain, up to the limits that you select.

Learn more about Uninsured Motorist (UM) insurance.

Underinsured motorist coverage (UIM)

If a driver or owner of a vehicle is legally liable for an accident but does not have enough insurance, you can use UIM coverage for injuries, including death, that you, your resident relatives and occupants of your insured vehicle sustain, up to the limits you select. In some states, UIM coverage is included as part of UM coverage.

Learn more about Underinsured Motorist (UIM) insurance.

Uninsured/Underinsured motorist property damage coverage (UMPD)

If a driver or owner of a vehicle is legally liable for an accident but does not have insurance or does not have enough insurance, you can use UMPD to cover damage to your insured vehicle, up to the limits you select. UMPD is not available in all states and may be available as an alternative to Collision coverage in others.

Learn more about Uninsured/Underinsured Motorist Property Damage (UMPD) insurance.

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Vehicle identification number (VIN)

A VIN is a combination of 17 letters and numbers that can be used to identify the make, model and year of a car. The Vehicle Identification Number (VIN) for a vehicle is usually found on the driver's side of the dashboard, the vehicle registration or the title.