When it comes to insurance, there are a lot of terms revolving around it. We are familiar with some and some of them can be very alien to us. Here we have compiled a list of most common day-to-day Insurance terms along with their meanings:
This insurance covers you from accidental injury, accidental death, and related health expenditure. Accidental Death Benefit:This allows the beneficiary to have an additional benefit if the insured person meets an accidental death. Acts of God:
In Insurance terms, risks that cannot be reasonably insured against natural disasters like floods or earthquakes are called acts of God.
An actuary, in Insurance terms, is a professional expert in Insurance mathematics and uses their knowledge to calculate premium rates, dividends, company reserves, and other statistics.
The individuals who are authorised to sell insurance are called agents. An agent can be independent or self-employed who can represent multiple Insurance companies and are paid on commissions. The agent can also be exclusive or captive who represents just one insurance company and can be salaried or work on commissions earned.
An annuity is the periodic income benefits received by the annuitant from the insurance company for a given amount of time period or over the course of the lifetime according to the insurance contract.
It is the price set by the Insurance company to cover the vehicle, based upon the frequency and expenses of possible accidents or other damages.
A policy which covers the health, medical, surgical expenses.
A person named in the Insurance contract who is eligible to receive the benefits of the policy.
An Insurance which protects the insured from the loss of property because of theft, robbery, burglary, etc.
It covers the drop in revenue in case of any unplanned risk.
A policy that covers the property, liability and interruption of the business for small or medium sized entrepreneurs.
Cash value is the savings generated due to returns from some Insurance policies.
It is a reinsurance term which means some part of the covered risk is transferred to the reinsurance company by the existing Insurance company.
The professional responsible for coordinating the risk management strategy of the company.
It requires the policyholder to carry an insurance equal to a specified percentage of the insured entity (property, health, etc.) in order to receive full payment on loss.
It is the total sum of (a) expenses to minimise the risk (b) the opportunity cost passed upon due to consideration of the risk (c) cost of strategies to cover possible losses and (d) cost of compensating the losses.
The Scope of the insurance cover.
Casualty/Property Insurance collected by the company from the client before deducting the reinsurance premium.
Money that is returned to policyholders from the earnings of the insurance company.
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Type of Life Insurance that pays the face amount to the insured person at the end of the term, given the person is alive. If the policyholder dies within the term, the Face Value is to be paid in the event of death.
It is the provision in a policy to exclude coverage for certain risks, damages, people, etc.
A type of Marine Insurance policy that covers the damages that might occur during the transit of subject from one place to another.
A single insurance policy that covers a group of individuals usually employees of a company or an association.
It is the total sum of money(both principal and interest) paid at regular intervals over a person's working life, will give out the similar income the person would have earned without the taxes and personal expenses.
A legal principle in which the insured person must show that they have incurred a loss. This prevents insurance from being a gamble.
A risk for which it is relatively easy to get insured for and which meets the criteria of the insurance company.
An insurance policy that remains active throughout the life of the insured person and aims to cover the expenses after the death of the policyholder.
A written contract between the insurance company and the client which states the details of coverage offered.
In Insurance terms, the death that occurs before the anticipated time is called premature death.
The price paid for an insurance policy.
Reinsurance is covering the risk taken by the primary insurance company by a larger insurance agency. The reinsurance business is global and mostly based abroad.
A type of Life Insurance that covers a period of time in the life of the insured person.
In insurance terms utmost good faith is a moral duty imposed on both the parties at the time of the insurance agreement. This duty expects higher standards of honesty than that is expected from an ordinary commercial contract.
A type of Life Insurance that covers the insured person from the expenses that occur in the case of premature death. It is the oldest form of Insurance.