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Faq

  • What is Life Insurance?

    Life insurance policy gives you the protection against financial losses resulting from the insured individuals death. It provides you and your family the financial security and certainty to deal with the aftermath of any unfortunate events.
  • What do I do if I need to make any changes to my policy or e IA? Do I submit a request to the Insurance Company or to the Insurance Repository?

    It is best to submit ALL requests in respect of either your e IA or any of your electronic policies to the Insurance Repository. If the changes are with respect to an account level detail (like address or phone number), the Insurance Repository will execute the change after the necessary KYC verification, if any. The Insurance Repository will then intimate the changes to all the Insurance Companies whose policies are held in that e IA, so that the changes are effected in all the policies, in one go (so there is no need for the policy holder to approach the various insurance companies individually for the changes).

    In case of any changes at the policy level, the Insurance Repository is expected to forward the request to the respective insurance company and ensure that the same is executed and reflected in the electronic policy held with the Insurance Repository.
  • Can a policy holder have both paper and electronic policies?

    Policy holders can choose the form in which they want their policies issued paper or electronic. A policy can be bought or maintained in one form only either in electronic form or paper but not in both. However, a policy holder can choose to keep some policies in electronic form and others in paper form only the electronic policies will be reflected in his e IA account and he can use repository services only for the e policies (and not the paper policies)
  • What is the difference between health insurance plan of General Insurance Companies and Life Insurance Companies?

    Health insurance plan of general insurance company works on the principle of reimbursement. In which hospitalization expenses (provided that of min of 24 hrs hospitalization) is paid upto sum assured.

    Health insurance plan of life insurance companies works on the principle of compensation. In which hospital daily cash benefit (provided that of min 48 hrs hospitalization) and major surgical benefits are paid as per the fixed amount under plan opted irrespective of actual expenses. In this type of plan premium are allocated in two parts one is investments and another is for providing benefits. Generally, premium and expenses are on higher side in such type of plan.
  • What is a medical examination when buying insurance?

    An individual buying insurance for a sum of Rs 600,000 and above has to undergo a medical examination. This is done by the insurance company since it needs to ensure that the prospective client is healthy. Also the company wants to verify that the objective of buying a policy is to insure against a risk and not to deceive the company
  • How do I reduce the cost of buying life insurance?

    The cost of a policy could be lowered if one starts buying insurance at an early age (while the risk is lower). A longer duration policy along with large sum assured would also reduce the cost. Also you will avail discounts if you offer to pay premium annually. Select a low cost policy such as a Term product. Do not buy riders or additional benefits that may not be of additional benefit to you.
  • How long will it take for the Insurance Repository to open AN e Insurance Account?

    The Insurance Repository will open an e Insurance Account within 7 business days from the date of receiving the eIA application form. On opening the e IA, the Insurance Repository will inform the applicant the particulars of the e Insurance Account and usage instructions through email and by post.
  • What is the guaranteed Savings/bonus applicable under a Life Insurance Policy?

    There are some insurance policies that guarantee the amount of money you would receive upon maturity. Typically, this amount is a proportion of the sum assured such as a bonus or a guaranteed addition. Lets say bonus is Rs 50 per Rs 1000 of the sum assured and you have an insurance policy for a sum assured of Rs 100,000 then you earn a bonus of Rs 5,000 each year on the sum assured.
    Other policies may offer you a guaranteed bonus as a percentage such as a guaranteed addition of 3.5% per annum on a compounded basis.
  • What are the various types of insurances?

    The insurance sector is classified into Life and Non-life or General insurance
    Under Life insurance, an individuals life is covered. In simple terms, the insureds nominee will receive a certain amount of money from the insurance company if the insured individual dies within a specified time.
    Under General Insurance, everything is covered. Thus, an individual could insure himself for his health, property, vehicle, travel, office, shop, education and even pets.
  • How do I convert my existing paper policy into electronic form?

    On opening an e IA, you just need to write out a request, addressed to the Insurer, for converting your existing paper policy to electronic mode. Request Forms for policy conversion are available in all offices of the respective Insurance Repositories. They can also be downloaded from respective websites. You need to fill out a separate request for each paper policy that you wish to convert to electronic form. These requests, duly signed, can be submitted at the respective Insurance Company or at any Insurance Repository office.

    If you do not have an e IA, you can submit an e IA opening form with the necessary supporting documents along with the request for converting paper policy to electronic mode.

insurance glossary

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
  • Abstract

    A brief history of title to land
  • Accelerated death benefit

    A percentage of the policy?s face amount, discounted for interest, that can be paid to the insured prior to death, under specified circumstances. This is in lieu of a traditional policy that pays beneficiaries after the insured?s death. Such benefits kick in if the insured becomes terminally ill, needs extreme medical intervention, or must reside in a nursing home. The payments made while the insured is living are deducted from any death benefits paid to beneficiaries.
  • Accident & Accidental Death Benefit

    In the context of life insurance, accident or accidental death is defined as a sudden and unforeseen happening that causes disability or death of the policyholder.
  • Accident and health insurance

    Coverage for acci-dental injury, accidental death, and related health expenses. Benefits will pay for preventative services, medical expenses, and catastrophic care, with limits.
  • Accidental death benefit

    An endorsement that pays the beneficiary an additional benefit if the insured dies from an accident.
  • Accidental Death Insurance

    Accidental Death Insurance provides coverage in the event of death due to accidental injuries, but not illness. In the event of death, payment is made to the insured\'s beneficiary. And most of these covers provide for cases for bodily injury (e.g., the loss of a limb), where the insured receives a specificed sum.
  • Accounts receivable (debtors) insurance

    Indemnifies for losses that are due to an inability to collect from open commercial account debtors because records have been destroyed by an insured peril.
  • Accumulation Period

    The time interval between the commencement of the policy and the time when benefits are paid out. It is established by the insured.
  • Activities of daily living

    Activities-such as eating, bathing, toileting, dressing, and continence-that trig-ger payment in a long-term care insurance policy, if at least some of them cannot be performed by the insured.
  • Acts of god

    Perils that cannot reasonably be guarded against, such as floods and earthquakes.
  • Actual cash value

    A form of insurance that pays damages equal to the replacement value of damaged property minus depreciation.
  • Actual loss ratio

    The ratio of losses incurred to premiums earned actually experienced in a given line of insurance activity in a previous time period.
  • Actuarial cost assumptions

    Assumptions about rates of investment earnings, mortality, turnover, salpatterns, probable expenses, and distribution or actual ages at which employees are likely to retire.
  • Actuarial Cost Method

    A method that determines contributions that would be made under an insurance plan.
  • Actuary

    An insurance professional skilled in the analysis, evaluation, and management of statistical information. Evaluates insurance firms? reserves, determines rates and rating methods, and determines other business and financial risks.
  • AD&D

    Accidental Death and Dismemberment Benefits
  • Additional insureds

    Persons who have an insurable interest in the property/person covered in a policy and who are covered against the losses outlined in the policy. They usually receive less coverage than the pri-mary named insured.
  • Additional living expenses

    Extra charges covered by homeowners policies over and above the policy-holder?s customary living expenses. They kick in when the insured requires temporary shelter due to damage by a covered peril that makes the home temporarily uninhabitable.
  • Adjustable Life Insurance

    A facility allowing a life insurance policy owner to change the insurance plan, increase or decrease the premium and make changes in the protection period.
  • Adjuster

    An individual employed by a property/cas-ualty insurer to evaluate losses and settle policyholder claims. These adjusters differ from public adjusters, who negotiate with insurers on behalf of policyhold-ers, and receive a portion of a claims settlement. Inde-pendent adjusters are independent contractors who adjust claims for different insurance companies.
  • Admitted company

    An insurance company licensed and authorized to do business in a particular state or country.
  • Adverse selection

    The tendency of those exposed to a higher risk to seek more insurance coverage than those at a lower risk. Insurers react either by charging higher premiums or not insuring at all. In the case of natural disasters, such as earthquakes, adverse selection concentrates risk instead of spreading it. Insurance. works best when risk is shared among large numbers of policyholders.
  • Affinity sales

    Selling insurance through groups such as professional and business associations.
  • Affirmative warranty

    An agreement between an insurance company and an agent, granting the agent authority to write insurance from that company. It specifies the duties, rights, and obligations of both parties.
  • After Tax Rupees

    This refers to the disposable income that the policy holder has in his hands after paying all tax dues during a particular financial year under the Income Tax Act.
  • Age Limits

    The maximum and minimum ages above or below which an insurance company will not accept applications for insurance from or will not renew a policy with a person.
  • Agent

    Insurance is sold by two types of agents: inde-pendent agents, who are self-employed, represent several insurance companies and are paid on commission, and exclusive or captive agents, who represent only one insurance company and are either salaried or work on commission. Insurance companies that use exclusive or captive agents are called direct writers.
  • Agent (Life Advisor)

    A representative of an insurance company authorized to sell insurance policies.
  • Aggregate deductible

    A type of deductible that applies for an entire year in which the insured absorbs all losses until the deductible level is reached, at which point the insurer pays for all loses over the specified amount.
  • Aggregate limits

    A yearly limit, rather than a ?per occurrence? limit. Once an insurance company has paid up to the limit, it will pay no more during that year.
  • Aleatory contract

    A legal contract in which the outcome depends on an uncertain event. Insurance contracts are aleatory in nature.
  • All-risk agreement

    A property or liability insur-ance contract in which all risks of loss are covered except those specifically excluded; also called ?open perils policy.?
  • Alternative dispute resolution (ADR)

    Alternative to going to court to settle disputes. Methods include arbitration, where disputing parties agree to be bound to the decision of an independent third party, and mediation, where a third party tries to arrange a settlement between the two sides.
  • Alternative markets

    Mechanisms used to fund self-insurance. This includes captives, which are insurers owned by one or more non-insurers to provide owners with coverage. Risk-retention groups, formed by members of similar professions or businesses to obtain liability insurance, are also a form of self-insurance.
  • Ancillary charges

    In hospital insurance, covered charges other than room and board.
  • Annual statement

    Summary of an insurer?s or rein-surer?s financial operations for a particular year, including a balance sheet.
  • Annual-premium annuity

    An annuity whose purchase price is paid in annual installments.
  • Annuitant

    : An individual receiving benefits under an annuity.
  • Annuity Certain

    An insurance contract that provides an annuity for a certain number of years, irrespective of whether the insured is alive or dead.
  • Annuity Consideration

    The payment that an annuitant makes for an annuity.
  • Annuity units

    A measure used in valuing a variable annuity during the time it is being paid to the annui-tant. Each unit?s value fluctuates with the performance of an investment portfolio.
  • Apportionment

    The dividing of a loss proportion-ately among two or more insurers that cover the same loss.
  • Appraisal

    A survey to determine a property?s insura-ble value, or the amount of a loss.
  • Arbitration

    Procedure in which an insurance company and the insured or a vendor agree to settle a claim dispute by accepting a decision made by a third party.
  • Arson

    The deliberate setting of a fire
  • Assessable policy

    A policy subject to additional charges, or assessments, on all policyholders in the company.
  • Asset-backed securities

    Bonds that represent pools of loans of similar types, duration and interest rates. Almost any loan with regular repayments of principal and interest can be securitized, from auto loans and equipment leases to credit card receivables and mortgages.
  • Assign

    To use life insurance policy benefits as collat-eral for a loan.
  • Assignee

    Assignee is the person to whom the title, rights and benefits under a life policy are assigned.
  • Assignor

    Assignor is the policyholder who transfers the title, beneficial interest and rights under the policy to another individual.
  • Asymmetric information

    An insured?s knowledge of likely losses that is unavailable to insurers.
  • Attained Age

    It is your current age.Your attained age is one of the factors life insurance companies use to determine your premiums. As the older you are, the probability of death during the period of insurance cover i.e life insurance risk increases and so does the premium. Higher the risk, higher the premium.
  • Authority

    The Insurance Regulatory and Development authority, IRDA established under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999 is the regulator for the insurance sector.
  • Auto insurance premium

    The price an insurance company charges for coverage, based on the frequency and cost of potential accidents, theft and other losses.
  • Automatic coverage

    An insurer agrees to cover accidents from all machinery of the same type as that specifically listed in the endorsement.
  • Automatic treaty

    An agreement whereby the ceding company is required to cede some certain amounts of business and the reinsurer is required to accept them.
  • Average adjusters

    A name applied to claims adjusters in the field of marine insurance.
  • Aviation insurance

    Commercial airlines hold prop-erty insurance on aeroplanes and liability insurance for negligent acts that result in injury or property damage to passengers or others. Damage is covered on the ground and in the air. The policy limits the geographical area and individual pilots covered.