A lot of us, especially first-timers who are interested to get some type of insurance for our safety and security, are understandably easily confused when presented with insurance words. Even if at first you do not understand anything about insurance, do not let this obstacle put you off! Getting some type of insurance, for example, life insurance, is something that is too important to just put off because you do not understand the words used in it.
Below are some of the technical terminologies that you ought to know and understand when you are getting an insurance policy:
Beneficiary – the person, individual or group that will benefit or receive the money or other items from a will, trust or life insurance policy.
Claim – after suffering a loss which is fortunately covered under the insurance policy, you can make a claim to your insurance company. Simply put, you are just “claiming” for the agreed compensation for your stolen, damaged or lost property.
Cancellation – the policy is terminated prior to its expiration date. There will usually be a cancellation clause present in a specific policy which normally explains the cancellation terms for both you as the policy holder and the insurance company. In some cases, a return premium will be paid to the policy holder by the insurer right after a cancellation has been made.
Dependant – an individual that you clearly financially support. A dependant can either be one of the following: your parents, your spouse or partner, and even your own children. These are usually the primary ones that you will put in the contract as your beneficiaries when availing an insurance policy.
Premiums – the monthly or yearly payments you have to give to the insurance company in order to keep your insurance in effect (until you have sufficiently met the entire payment for the policy to be carried out).
Exclusion – more like a stipulation in an insurance policy that will say what restrictions apply to a cover or what other things that are not covered.
Excess – the specific amount of cash or money that you pay in the event a claim is made. If the policy holder opts to pay an increased excess, then the outcome would be that you are entitled to a cheaper premium. In many cases, you can have different excesses for different claims you will make, so it is best that you check your policy for assurance and clarity.