What is an Insurance Policy?
It is an agreement between the policyholder and the insurer, in this agreement the policyholder agrees to pay a pre-decided amount (premium) to the insurer, and in return for that, the insurer agrees to pay the decided amount after the policy expires or under certain circumstances. It covered all possible loss, damage, and illness events. A typical insurance policy has your policy number, coverage period, amount of coverage, stuff that is covered, and what isn’t covered in the policy. Many insured (policyholders) purchase a policy without understanding what it covers and the condition that is met to apply for coverage when a loss occurs. That’s why it is important to understand the entire policy to avoid future problems.
What is an Insurance Policy? – Definition and Types
You cannot see a risk-free life for yourself and your loved ones, but you can always choose an insurance policy for being prepared for unseen emergencies in life. It is surprising when you find out that insurance was different in history than in the modern age. Today you have a large number of companies providing different types of insurance to the people, but in history, before these companies exist people were worried about losing their valuables, their belongings, and their cargo, that is why it’s interesting to note that marine insurance was known as the first type of insurance and it has a unique name ‘Bottom Rebounds. In the 17 century, London became the center for choosing marine insurance. Later in the 18th century, different insurance policies were developed and changed as time passed.