Some Insurance Terms for NICL AO Exam

●Some Insurance terms to know●

Insurance:

Indian Contract Act 1872, “A Contract may be defined as an agreement between two or more parties to do or to abstain from doing an act, with an intention to create a legally binding relationship.” It is a contract in which the insurer pays a fixed some after occurrence of an event and the insured have o pay the monthly payments for this which is called the premium.

Banccasurance

It is defined as a process of selling of insurance policy by the banking system. Banks often sell the insurance policy to its existing customers which are called the Banccasurance. It helps in selling more policy to the customers.

Actuary

This term is defined for a person who is expert in economics, math etc and can access the risk effectively which is involved in the payment of premiums etc. there people are hired by the insurance and other industries to improve their efficiency.

Actuarial science

It is a science of studying the risks which are involved in the insurance policies and the companies and industries follow this to minimize their risk factors. This uses a concept of statistics and mathematics to access the various risks.

Third party administrators

This party administrators are the persons/ companies who maintains the link between the policy holder, health insurance companies etc. they maintain the database of the person who is nursed against the health insurance and also issue them the identity card etc.

Mortality charge

This is the payment made by the insurance companies upon the death event of the policy holder. this insurance is generally done by the life based insurance companies.

Maturity date:

It is date after which you will get the principal amount that you have invested in a policy. After the completion of this period, the insured will get a fixed amount fulfilling the eligibility and norms of the company.

Agent

An agent is person who generally sells the insurance policy to the customers and he helps in the penetration of insurance in the country.

Agent can be of two types

Captive agent: it is the agent who sales insurance policy of specific types to the customers.Independent agent: it is the agent who can sell the insurance policy of any company to the customers.

Broker:

A broker is also a person who is experience and has gained expertise in the insurance policy and their risks and he/ she advises the client before buying an insurance policy regarding its risk factors.

Annuity:

It is along term contact which is designed to provide the payment to the insured after a regular interval of time which is called the annuity.

AD &D in the insurance

It is a policy of the insurance companies which is called the “accidental death dismemberment” policy in which the company will pay the insured only when the death is caused by the accident.

Lapsed policy

It is policy which has been discontinued and ceased by the company on the account of non payment of the insurance premium at regular interval or even after the grace period provided to the customers. Such policies are called the lapsed policies.

Surrender value:

This is the value/ amount of the policy that the insured will get from the company if he \ she decides to exit the policy before the maturity of the policy.

Also Read NICL AO Study Materials

Maturity claim:

This is claim made by the customer or policy holder through a claim form and sent to the company before the maturity date to have the amount settled at the time of the maturity. It is done through the ECS (electronic clearing services)

Death claim:

It is a type of claim that is made by the nominee of the insured to the company which has insured and provided the policy in the death event of the insured.

Gratuity

Gratuity is a part of salary that is received by an employee from his/her employer in gratitude for the services offered by the employee in the company. For5 this the candidates must have worked at least 5 years in the company to avail of this service.

Void contact:

It is type of contact which cannot be enforced trough a court of Law. This is a contact which is void and is not considered the contract at all and so no claim regarding this can be made by the insured.

Terminal bonus:

It is a type of bonus which the insurance companies provide to its customers for maintaining the premium at regular intervals and also till the maturity dates. This bonus is paid at the time of maturity of the policy.

Encumbrance:

It is a claim on property or any tangible instruments on the right of dower. The interest of the property is reduced by the amount of encumbrance.

These are some of the important terms which the candidates should know for their upcoming examination etc. learn these terms.