Insurance 101

Hello, Welcome to another addition of SML Blogger. In this blog I will be going over definitions and terms of the insurance business, Sometimes the terms and definitions don't make sense unless your actually in the business. Here are some of the standard terms that are basic and you need to know. Premium: The amount of money paid to an insurance company for coverage. It can be paid monthly, quarterly, or annually. Deductible: The amount you must pay out-of-pocket before your insurance policy begins to pay for covered expenses. Policy: A formal contract between the insured and the insurance company, outlining the terms of coverage, conditions, and exclusions. Claim: A request made by the insured to the insurance company for payment of a covered loss or event. Underwriting: The process of evaluating the risk and exposures of an insurance applicant to determine the terms and conditions of the insurance policy. Coverage: The protection provided by the insurance policy, specifying what is and not included. Exclusion: Specific conditions or circumstances for which the insurance policy will not provide coverage. Risk: The chance or probability of a loss occurring, which insurance companies assess when issuing policies. These few definitions are important when you are trying to understand a policy. The number of questions we received just for the definition are huge. They can be confusing. This is why its so import to understand these terms, because your decisions depends on your understanding of the terms and conditions. I highlight a very important area. Exclusion I can not stress how important it is to view this section of your policy. Hopefully your agent did this for you and raised any question in regards to the exclusion section for you.

I can not stress that your agent overviews the entire policy with you and before you sign it. The quote will tell you what is and isn't covered for you and what kind of limits to have for claims. This is the important of having a independent agent (Broker) as to a captive agent, who is just trying to close the deal and move on, while the broker is looking out for you long term.

Again, let us know if there are any other topics you need us to help with understanding or talking about.

Cheers,