What is insurance policy

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What is insurance policy?

A very serious fact of life is that no matter how hard we try to lead a protected life, accidents are likely to occur if not now later in your life. Some accidents are so severe that they prove disastrous for the whole family .To tackle with the accidents of  life a system was developed a long time ago in which a bank or other financial institution provides people with facility of payment of damages by the company after paying a  monthly premium. These facilities were provided to people who signed a written agreement. It is always wise to make your life and that of your near and dear ones protected against any unforeseen circumstances.

According to all the textbooks ever printed an insurance policy is an agreement between two parties the insurer and the insured about the payment of damage done to a person’s property both mobile and stationary or health. In short, an insurance policy is a written document that determines the amount the insurer is legally bound to pay for the losses or damages done to the insured person’s health or property. The whole system and terms used in the process of insurance is very confusing for a common man and every person should know what the insurer is talking about, in order to make you understood the terms used by the insurer here is a list of some of the commonly used terms when you go for insurance.

What is insurance policy
What is insurance policy

 

GENERAL TERMS

One of the most commonly used terms in the process of insurance is the word the premium, premium is the amount of money that is paid to the insurer who will then pay the coverage in case of a mishap. In most of the insurance policies the payment of this premium is due on a monthly basis. There are a number of companies out there who offer insurance services, so, if you want to get insured, you should first check with the market with a company with good reputation and find the one that is most reliable yet affordable for you. Once you sign the insurance papers, never be late, for the payment of your premium. In the insurance language you, the insured are called the policyholder. One more term that most of the insurance agents use is the deductibles, the deductible is the amount that the policyholder has to pay in case of a damage incurred. If the damage is more than the policyholder can afford, then only then the insurer is bound to cover the rest of the damage. In most of the cases lower premiums are the result of high deductibles. If you have signed an insurance policy according to which you have to pay high rate of deductibles then it is always better to save some money in order to pay the deductibles. The request an insured person makes to the insurer for the payment of damages occurred is known as the claim. One more person is involved in the process of payments if damage is incurred, this person is known as an adjuster, it is the duty of the adjuster to analyze the claims made by the insured and the details of the policy .The adjuster is provides with recommendations about the settlement of the case between the insurer and the insured.

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