Important terminogy of insurance

Important terminology of Insurance

i) Insurer: A person or organization who promises to pay or compensate to the loss of other at a given risk is called insurer.

ii) Insured: Insured is the person who insures his life or property and gets protection or compensation from the other. He is also called policyholder.

iii) Premium: Premium is the sum paid by insured to the insurance company in exchange of the policy he/she purchased.

iv) Insurance policy: It refers to a document containing the terms and conditions of the contract or insurance. This policy binds both the insurer and insured to fulfill their duties.

v) Insured amount: The amount for which the policy is issued is called subject matter or insurance.

vi) Subject matter of insurance: Anything which is insured is called subject matter of insurance.

vii) Insurable interest: It refers to the interest of insured in the subject matter of insurance.