Insurance: Parts of an Insurance
Who / What is being insured? A clear description of what is being insured. It’s always important to be specific so you know exactly what is being insured. The person who is receiving the insurance is the insuree.
The Insurance Policy which states exactly what is being insured and what isn’t.
The Claim which is a request from the person who holds the insurance to the insurance company for compensation.
He also explained to them what other details are needed for an insurance policy:
Information on the Insurer: Detailed information on who is insuring you and what their claims policy and processes are.
Risks which are covered: A specific list of things events which are covered. For example, if you are insuring a house, then floods or natural disasters may not be insured. If you are getting health insurance, then certain forms of illnesses may not be covered.
Beneficiary: Who will be given the insurance money in case there is a claim and the insurance company needs to pay out the claim.
Premium: the regular amount you pay to ensure that your investment is protected.
Deductible: The amount you will pay out of your own funds in case something happens to your investment. Insurance companies do this to prevent people from making a number of small claims. The deductible means that every time you make a claim you have to pay some money out of your pocket as well.
Term: How long the insurance is valid for. It could be a few hours to lifetime. It all depends on the insurance type.
Liability: Determining who is at fault when an incident happens and also who has most to lose.