Insurance Policy

1) What is the contestable period’ in insurance policy?

‘Contestable period’ is usually 1 or 2 years, during which the insurance company holds all the right to investigate the policy and decide whether to pay or not to pay to the insured.

2)      What is the difference between “revocable beneficiary” and “irrevocable beneficiary”?

‘Revocable beneficiary’ designation gives right to the policy holder to change the beneficiary name without the consent of the named beneficiary. While in ‘Irrevocable beneficiary’ the policy holder has to take consent of the beneficiary before the name is changed.

3)       What is no-claim bonus?

No claim bonus is a benefit for those who have not claimed insurance during the preceding year of cover. This will lower the premium on the following year.

4)      What is ‘declaration page’ in insurance policy?

‘Declaration page’ in insurance policy, bears all the information of the policy holder like name, address, vehicle information, type of coverage and loss payee information.

5)   What do you mean by ‘Loss Payee’?

The loss payee is a person or institution (Bank) that receives the insurance payment on the loss of the property or vehicle you own.  It is a legal definition used to cover the investment of other parties or bank that is owned by you. For example, you have a car on loan, and also you have insurance for that car. Now you met an accident, and your car is a total loss(meaning completely damaged beyond repair). Your bank still owes money from you in such case when you claim the insurance; the insurance company will pay money directly to Bank or person you owes money. Here bank is a loss payee.