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Un-complicating Car Insurance: Part Four

2017 04 27 Sayitsimple Partfour

By Madeline Klein on April 27, 2017 in Insurance Basics

Who's up for another round of un-complicating auto insurance terms? If you missed parts one, two or three, go ahead and give 'em a look when you get a chance. For now, let's dive into three new terms!

Transportation Network Company (TNC): A company that connects drivers, who drive their own personal vehicles, with passengers through a mobile app or website. Consider non-taxi companies (like Uber or Lyft) that coordinate all of the details of the ride including driver, pick up location and fare rate. The trendier term for a TNC is ridesharing, though some prefer ridesourcing, since the driver and passenger don't technically "share" the same destination.

Direct Loss: Any physical or financial loss (including injuries), that is an immediate result of an accident, disaster or other incident. It's when you can clearly define a cause (like an accident) and effect (damaged vehicle) without any broken chains or extra influences. Say a hail storm comes through town and cracks your windshield. A direct loss would be how much it costs to replace your windshield, while a consequential loss (which we defined in part three) would be the cost of using Uber while your car is being fixed.

Financial Responsibility Law: A law requiring a person to prove he or she can afford to pay for damages resulting from an auto accident, before he or she can own, use or allow others to use a vehicle. There are several ways a person can go about proving they have enough money, but the most common way is to purchase a car insurance policy, since most state minimum requirements satisfy the law. Other options are, according to, posting a surety bond, keeping a cash deposit or filing a government bond with your state.

That's it for this round! Have any terms holding you up? Let us know on Facebook or Twitter.

Madeline Klein is Say's Digital Content Producer. She graduated from the University of Missouri with a Bachelor of Journalism, emphasis in Strategic Communication. Her experience is in writing and digital media. Madeline loves using her creativity to write and design new and exciting pieces of work for Say!