We seldom have the opportunity to prepare for uncertainties because they always come unplanned. Still, in some situations, we can make contingency plans, especially towards the risks we face in life. One of such ways is taking an insurance policy.
While some Nigerians understand the topic of insurance, and why you need one, it is essential to know what to expect from an insurance policy in case you might be opting for one.
An insurance policy is a contract of agreement between a policyholder and an insurance company. It’s a document that illustrates what is covered and other details and conditions of the agreement.
What to Expect in an Insurance Policy
Some receive their insurance policies and wonder what they need to know. Sometimes the terms in these documents can be confusing due to the use of specific jargons. The following details may contain some or all of what is in an insurance policy.
Policy number: This is the number with which your policy is registered. It’ll be needed if you have to lodge a claim.
Duration of cover: These dates specify when the coverage is in place and when it starts and ends.
Underwritten by: This is a way of indicating who your insurer is or the company you’re insured by.
Premiums: The cost of the insurance.
Endorsement: This is also called a rider; it is an addition to the insurance policy. Endorsements may add or alter the scope of coverage under a policy.
Insured Item: This is the reason why the policy is written. It could be your home, car, a personal property (the contents of a home or building), jewellery or any other thing such as equipment or tools.
Additional name insured: the name of a co-owner of property; that have the same rights to the property as you.
These and other information explaining the terms and conditions of your policy.
Why it’s important to Examine your policy?
It’s a solid idea to review what is covered in your policy so you’ll understand when and how to use it. It lets you know when you may be breaching the contract and actions that might lead to forfeiting the policy. It also enables you to understand what your insurance covers and what you can file a claim for.
For example, your policy could indicate that some certain scenarios aren’t covered by your insurance, examining your policy lets you grasp when you can and cannot file for claims.
Things to Consider Before Getting an Insurance Policy
It’s advisable to carry out due diligence before you purchase an insurance policy. You want to ensure that the insurance you’re taking is ideal for your needs. Here are some following tips to consider before you choose an insurance policy.
Affordability: Seeking an affordable cover is an excellent way to ensure that you can hold on to a policy.
Consider Payout terms: Be sure of the payout conditions of the policy you intend to take. They are some payout conditions that have longer waiting periods which are unfavourable.
The Benefits: several insurance policies offer different benefits. You can compare the policies you intend to take among other insurance companies to ensure you’re receiving the best. You might also want to look at the insurance of subrogation
Before Signing That Document
In conclusion, Most legal contracts can be difficult to understand but with the help of a financial advisor or an insurance broker, the terms of your policy can be explained to you for better understanding.