Auto insurance definitions and terms Every enterprise has its personal special and quirky jargon. The auto insurance plan is no exception. But first, precisely what is automobile insurance? A car insurance plan is a contract between you and your insurance plan company. By making use of for a coverage, you’re agreeing to pay an auto insurance plan top rate for the insurance plan company. In return, that corporation is of the same opinion to pay protected expenses related to an auto accident as soon as the deductible has been met beneath the coverage terms.