Insurance is sold either by a person who is self-employed, represents several insurers and is paid on commission, or by someone who only represents one insurance company and either salaried or paid a commission. The former person is known as an independent agent, while the latter is called and exclusive or captive agent or direct writer.
The individual or legal entity the owner of the insurance policy names to get the policy benefit if the insured – against event should happen.
Binder or Conditional Coverage
The temporary coverage the owner of an insurance policy gets until permanent coverage is approved.
A life insurance term referring to the amount, before adjustments, that the owner of a permanent policy is entitled to if the policy does not stay in force until the insured’s death or an amount paid in addition to the death benefit.
A process used by some state insurance departments to keep track of consumer complaints against insurance companies. Generally, this ratio reflects the number of complaints upheld against an insurer, as a percentage of the premiums it has collected.
Contestable or Contestability period
The time during which an insurance company has the right to back out of issuing a policy or paying a claim if it finds an applicant misrepresented him or herself on the application. this time frame is usually two (2) years.
The price paid for a life insurance policy. This can change monthly, quarterly, semiannually, or annually.
The way in which state keep track of rates charges made by insurance companies. This is done either through prior approval or open competition models.
What insurers refer to as the size of a particular loss.
This is an illegal insurance sales tactic in which an agent misrepresents themselves or the product being sold to get the consumer to purchase it.
A policy free of legal effect due to the fact that the policyholder has misrepresented himself or herself in the insurance buying process.
With regard to health insurance, the period of time that must pass after policy issuance before benefits are payable.
The pre-agreed amount of money the policyholder must pay over and above what the insurer pays.
Otherwise known as a rider, this is a written attachment to an insurance policy that makes an alteration or addition to the policy’s features, benefits, coverage, terms or conditions.
When a policyholder or beneficiary intentionally deceive or conceals information in order to get an insurance company to issue a policy or pay a claim that would otherwise be declined or unpaid.
With regard to insurance, this reflects the amount of time you have after the premium is due to pay without penalty or lapse of coverage.
Provide monetary compensation of losses.
When an insurance company terminates a policy because renewal premiums have not been paid by the end of the grace period.
The rate at which death occurs for members of a specific sector, age, and gender group. Life insurance rates are based, in part, on mortality rates.
A group that an insurer places a customer in that reflects his risk of filing a claim against the company. Consumers in the preferred risk class will have the lowest and premium payments.
The way in which an insurance company puts back into force a policy that has lapsed due to such thing as failure to pay premiums or reduced paid-up coverage.
The choices an owner or beneficiary of a life insurance policy gets on how the insurer is going to pay out when the policy owner or beneficiary take the benefits over time instead of one lump sum.
When a policyholder has not bought enough insurance to cover a particular loss.
The method by which insurers assess risk to determine if you are eligible for coverage and if so, what your premiums or rate should be.