Basic terminology of insurance

 What is the terminology of insurance ?

Policyholder: 

The person or entity that owns an insurance policy and is entitled to receive benefits or compensation in case of a covered loss.

Insurer/Insurance Company:

 The company that provides insurance coverage and assumes the risk of potential losses in exchange for premium payments.

Premium: 

The amount  paid by the policyholder to the insurance company in exchange for insurance coverage.

Deductible: 

The amount of money that the policyholder is required to pay out of pocket before the insurance company starts covering the remaining expenses.

Coverage: 

The specific risks or events that an insurance policy protects against. It outlines what losses or damages are eligible for compensation.

Policy: 

A  contract between the insurer and the policyholder.

Claim: 

A formal request made by the policyholder to the insurance company for compensation or benefits due to a covered loss or event.

Insured: 

The person or property covered by an insurance policy. It can refer to the policyholder or any other individuals or entities specified in the policy.

Underwriter: 

The person responsible for assessing risks, determining premiums, and deciding whether to accept or reject insurance applications.

Liability: 

The legal responsibility of an individual or entity for damages caused to others, which may be covered by liability insurance.

Indemnity:

 The principle of restoring the policyholder to the same financial position they were in before a covered loss occurred, typically through monetary compensation.

Exclusion: 

Specific events, conditions, or circumstances listed in an insurance policy that are not covered by the insurance company.

Rider/Endorsement:

 An additional provision or amendment to an insurance policy that modifies the coverage or terms of the original policy.

Loss Adjuster/Claims Adjuster: 

An individual employed by the insurance company who investigates and assesses the extent of a claim or loss and determines the appropriate compensation.

Actuary: 

A professional who uses statistical analysis and mathematical models to assess risks and calculate insurance premiums.

Reinsurance:

 The  insurance company transferring a portion of its risk to another insurance company to reduce its exposure to large losses.

Salvage:

 The process of recovering value from damaged property or assets that have been written off as a loss by the insurance company.

Underinsured: 

When the policyholder's insurance coverage is not sufficient to fully compensate for the value of a loss or damages.

Insurable Interest: 

A financial or legal interest in the property or person being insured, which is necessary to obtain insurance coverage.

No-Claim Bonus: 

A discount or reduction in premium provided by the insurance company to policyholders who have not made any claims during a specified period.