These are the key terms of the insurance industry: part 2

Having the backing of insurance has become essential for everyone, since life is unpredictable and a clear fact of this was the appearance of Covid-19 in 2020, which took us all by surprise.

That is why having insurance is essential since we can not only protect our personal and real property, but also be supported in the event of an accident or illness. In this sense, we want to share with you the second part of the article where we explain the keywords that you must understand before taking out insurance.

Let us begin!

What is the grace period?

It is the fixed period during which the coverage of the life insurance policy remains in force, even though the corresponding premiums have not been paid. It is usually 30 days from the premium payment due date.

What is the endorsement?

It is a document where any correction suffered by the policy is disclosed.

Lack of insurance

This is the period of time from the beginning of the coverage period, during which the insured is not entitled to payment of compensation.

What is insured matter?

It is the object that is intended to protect against risks and a detailed description of what will be insured is made in the policy.

What is the insured amount or capital?

It refers to the value in which the insured has estimated that the assets he insures have and that they belong to the maximum amount of compensation that the insurer is obliged to pay in the event of a claim. It should be noted that in the case of life insurance, the amount insured is directly related to the premium paid and not to the value of the insured material.

What are coverages?

They refer to the set of risks that are transferred to the insurer due to the insurance, whose occurrence forces the company to pay the insured an indemnity up to the limit of the insured amount (according to the terms established in the particular and general conditions of the policy.

What is automatic renewal?

It is the agreement between the parties, where the insurance can be tacitly extended for a new period of validity unless the insured cancels it.

There are many terms that come to light when thinking about insurance, and it is possible that we get confused and have many doubts.

We hope this article has been useful to you. Soon we will be sharing part 3, because yes, there are many important words within the insurance sector. Wait for her!

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