kotrbiotech.com – Insurance is one of the needs is important if you want to have a personal financial stable and healthy. In addition to an emergency fund that is offered, ownership protection is the thing that should not be delayed.
By having Insurance, personal finance can be maintained from the risk-the risk of losses that may occur when dealing with a condition that requires a large cost.
For example, when you fall sick and need medical costs or when the backbone of the family died due to an accident so that the family income at a standstill.
The conditions of the pandemic make the needs of the insured becoming increasingly relevant. The risk of developing infectious diseases and the risk of death that threatens, making Insurance into one endeavor is important for maintaining the body’s health and financial peace of mind in addition to social distancing. Well, if you currently weigh to buy Insurance, you should recognize the first important terms in Insurance.
Understand the terms in Insurance will help you find the Insurance products that are most appropriate according to the needs. What are the terms of the Insurance which is important to understand? Listen below:
- Insurance Policy
An Insurance policy is the term to call the contract a cooperation agreement in writing between the Company and the Insurance Provider (Insurer Insurance) by the customer of the Policyholder.
All contracts of Insurance, whether it is life Insurance, Health Insurance to life Insurance, called by the name of the Insurance Policy.
The contents of the cooperation agreement contained in the Insurance is in agreement that the Insurance Provider is willing to bear the risks that are owned by the Insured named in the policy, in a certain period of time according to the agreement.
To get Insurance coverage from the Insurance Provider , the Policy Holder is obliged to pay a Cost Premium that has been agreed upon.
The Insurance Policy also contains the General Terms of the Policy, the details of the rights and obligations of the Insurance Provider, the Policy Holder, the reach of the Insurance Benefits provided, the article mentions the exception of protection, the article mentions things that could cancel the Policy.
In addition, in the Insurance Policy is typically attached also a sheet of Coverage, Special Provisions, also a copy of the Application Letter Insurance (Letter of Claim).
The Insurance policy includes important documents which have the force of law. Then, you are required to keep it in a special place that you can easily access at any time when required, for example when they wanted to claim Insurance.
- Insurance Premiums
To get Insurance, the Policyholder is obliged to pay a Premium to the Insurer for Insurance. The Insurance premium is defined as a payment that is set as the cost of transfer of risk from the Policyholder to the Insurance Provider.
The amount of the Premium is determined by your Insurance Provider and agreed by the Policyholder. Great small Premiums will be determined by many factors.
Among other things, the scope of protection provided by the Insurance Provider, the age of the Insured Insurance, life style or medical records of the Insured, gender, up to the sector of employment of the Insured.
The full and extensive range of protection an Insurance, the Premiums are typically more expensive. So also when the Insured is judged to have high risk, the Premium is automatically more expensive.
The Policyholder is usually given the option to tempo option Premium Payment. Namely: Monthly Premiums, Premiums Quarterly, Semester or Annual Premium Payments.
- The Insured Insurance
The term “the Insured” in an Insurance Policy refers to a person or party who obtained the guarantee of indemnity from the Insurance Provider when it occurs the risk referred to in the Policy.
In a life Insurance Policy, the Insured is the head of the family or family members that have economic value. In Health Insurance, the Insured can be anyone like employees, children, wife, parents, and others.
Thus, when there is a risk that is protected under the Policy, the Insured get a replacement of losses. Example, when the head of the family of the Insured in a life Insurance Policy dies, the Money life Insurance Coverage will be provided by the Insurance provider to the beneficiary designated in the policy.
The insured is not the same as the Policy Holder. An Insured is not necessarily a Policy Holder. For example, as the head of the family you buy a health Insurance then that you referred to as the Policy Holder while the Insured. The wife and kids that you insure are also referred to as the Insured.
- Insurance Benefits
Insurance benefits means of protection obtained by the Insured and Insurance is provided by Insurance companies. For example, a health Insurance providing benefits to the cost of inpatient medical, the cost of outpatient and benefits of surgery.
That means, when the Insured falls ill and requires treatment, the Insurance provider will provide for reimbursement of the cost of inpatient medical.
There is also a benefit of Insurance in the form and compensation as contained in the health Insurance manifold hospital cash plan. Being in the life Insurance, the Insurance benefit is in the form of the sum insured.
Sum Insured (UP) is the amount of funds to be liquid and is given by the Insurance provider to the heirs or beneficiaries designated in the policy, when the Insured dies.
- Claims
A claim is filed by the Policyholder to the Insurance company as the Insurer of Insurance, to fulfill the rights of the Policyholder as stated in the Policy.
An easy example, you have Health Insurance that bear the benefits of pain typhus. When you fell ill and had to be hospitalized because of the disease typhus, then you can file a claim benefits to the Insurance Provider.
The Insurer of the Insurance will pay compensation finance in the form of the cost of hospitalization and other costs according to the definition of the benefits listed in the Policy of such Insurance.
Insurance providers typically limit the period of Insurance claims. For Health Insurance, for example, the Insurer gives the time of the claim within maximum 30 days from the Insured to get the treatment.
- Cost Of Acquisition
This term refers to the costs to be paid by the Policy Holder to get the service as the customer’s Insurance. In addition to the “cost of acquisition”, the same cost is usually also referred to as the cost of issuance of the policy. The cost of the policy issue including the cost of payment of the fee of Insurance agents and operational costs of the Insurance company.
- Lapse
The Policyholder is required to pay a Premium to the Insurance Provider as agreed in the Policy, that Insurance Benefits can still be achieved during the contract takes place.
Well, if the Policyholder does not pay the Premiums required is beyond the Grace Period or Grace Period (generally for 45 days), then the Insurance Policy that is owned auto cancel or lapse.
Avoid the cancellation of the Policy by ensuring the payment of Premiums on time according to the payment term you select.
Lapse making of Insurance protection you can’t get. When a risk occurs when Insurance status lapse, the Insurance Provider is no longer obliged to bear the loss.
- Cash Value (Cash Value)
This term you encounter in the unit linked life Insurance or endowment Insurance (endowment). The cash value is the amount of money which can be redeemed by the policyholder in a certain period of time.
For example, in the product endowment Insurance such as the Insurance education, there is usually a cash value that can be availed by the policyholder when the policy was 3 years, 6 years and so on.
In unit-linked Insurance, namely life Insurance that features protection and also the features of the investment, the cash value means the results of the investment which is formed from the investment funds are regularly deposited by the policyholder.
- Additional Insurance (Rider)
This is a term to refer to the Additional Benefits that you can add to the Basic Insurance program. The Rider typically have Premiums cheaper because of its nature as a complement to the Primary Insurance.
For example, life Insurance products are generally equipped with a rider in the form of Health Insurance, Critical Illness Insurance or waiver of premium.
Only, you need to remember, the more the rider that you take the means also the more extensive Insurance Benefits for you to enjoy. It brings consequences on the more expensive the Cost of Premiums you have to pay.
- Leave Premiums (Premium Holiday)
Premium holiday refers to a specific time period in which the policyholder is allowed not to pay premiums or stop paying premiums without loss of Insurance benefits.
Leave premiums actually not that policyholders pay no premium at all. Leave premiums possible in the Insurance that has the features such investments unitlink.
When premium holiday run, actually insurers use Insurance cash value that has been formed from the unit link investment, to cover the cost of the premium. Premium holiday is possible when the cash value that is owned by a policy sufficient to pay the cost of premiums.
So if the value of the cash that has been formed is not sufficient to pay the premiums, then the policyholder must pay back the premium or top-up investment that benefits the Insurance remains in force and avoid a lapse.
Well, that’s 10 important terms in the Insurance that you have to understand and can be a guide so you can understand more of the Insurance products that will be or have been You buy.
