Glossary of Terms
Understanding insurance terminology is crucial for making informed decisions about your coverage. Here’s a detailed glossary of common insurance terms to help you navigate your policies with confidence:
A
- Adjuster: A professional who investigates and evaluates insurance claims to determine the amount of compensation owed to the policyholder.
B
- Beneficiary: The person or entity designated to receive benefits from an insurance policy, typically in the event of the policyholder's death.
C
- Claim: A formal request made by the policyholder to the insurance company for compensation for a covered loss or event.
- Coverage: The specific protections and benefits provided under an insurance policy, outlining what is included and excluded.
D
- Deductible: The amount the policyholder must pay out-of-pocket before the insurance company pays for a claim. Higher deductibles usually result in lower premiums.
E
- Exclusion: Specific conditions or circumstances that are not covered by an insurance policy. It's important to understand exclusions to avoid surprises during a claim.
F
- Fraud: Any intentional misrepresentation or deceit made by the policyholder or agent to gain an undeserved insurance benefit.
G
- Group Insurance: A type of insurance plan that provides coverage to a group of individuals, typically offered through employers or organizations.
I
- Indemnity: A principle that ensures a policyholder is compensated for losses, restoring them to their financial position before the loss occurred, without profit.
L
- Liability Insurance: Coverage that protects the policyholder against claims resulting from injuries or damage to other people or their property.
P
- Premium: The amount paid by the policyholder to the insurance company for coverage, typically billed monthly or annually.
- Policy: A legal contract between the insurance company and the policyholder that outlines the terms, conditions, coverage, and exclusions of the insurance.
R
- Renewal: The process of extending an insurance policy for another term, often requiring payment of the premium and possibly reassessment of coverage.
S
- Subrogation: The process by which an insurance company seeks reimbursement from a third party responsible for a loss after compensating the policyholder.
T
- Term Insurance: A type of life insurance that provides coverage for a specified period (the term) and pays a benefit only if the insured dies during that term.
- Underwriting: The process of evaluating risk and determining the terms and premium of an insurance policy, including assessing the applicant's eligibility and risk factors.
V
- Variable Life Insurance: A type of permanent life insurance that offers both a death benefit and a cash value component, where the cash value can be invested in various options that can fluctuate in value.
If you have any further questions about these terms or need clarification on specific concepts, feel free to reach out to our team at Senefico Inc. We're here to help you navigate your insurance journey!
