DELTASION.com – You must be familiar with the name insurance, but what
about the terms in insurance? As a financial need that is for the long term,
insurance is financial protection for life, assets, or others by dividing the
risk of loss of the customer with insurance supporters.
The insurance supports are insurance brokerage companies, reinsurance
brokerage companies, and insurance loss appraisal companies. Supporting
companies are required to pay insurance premiums to customers as financial
protection according to what is stated in the insurance policy agreement.
Insurance is divided into two types, namely general insurance and life
insurance. If you are interested in taking care of personal insurance, let’s
get to know the terms in the following insurance.
1. Terms in insurance
Automatic Premium Loan (APL)
Automatic premium loan means a provision from the insurer that allows them to
take the cash value from the policy automatically. This can happen if the
customer does not pay the premium, even until the grace period ends.
Costs used to fund marketing, operational costs, and others are known as
As a term in insurance, cash value is the amount of money that the company
gives to policyholders in cash. As interest, cash value applies to types of
insurance that have investment features.
The term used when you want to stop paying premiums for a while is known as
premium leave. Each insurance company also applies different premium leave
As a term in insurance, the grace period is a grace period after the maturity
given to customers. Although it varies, this period is on average valid 30
days after maturity.
Insurance claim is a request for compensation from the insured or customer to
the insurer according to what is stated in the insurance policy.
The term in the next insurance is lapse, which indicates the cancellation of
rights caused by inactivity for a certain period of time, for example the
customer’s negligence in carrying out obligations.
The term in insurance that is important to recognize next is mortality, which
means the estimated time of death is uncertain. In life insurance, mortality
is a consideration in determining insurance premiums.
One of the terms in insurance that is important to know is an insurance
policy. The policy is a written document that is legal in the eyes of the law
where the customer and the insurance company are the guarantor.
The term in this insurance refers to the obligation that the insurance company
must pay to the customer as financial protection according to what is stated
in the insurance policy agreement.
The next term in insurance is rider, which means additional benefits that you
can add to the insurance program of your choice. The more riders added, the
greater the amount of premium that needs to be paid.
The term in insurance also includes risk, which indicates the possibility of
bad things that might happen to someone.
As a term in insurance, the sum insured indicates the amount of money that
must be paid by the insurance company to the customer. This happens when the
customer makes a claim against the risks contained in the insurance policy.
2. Costs in insurance
Insurance costs are sourced from the periodic premium unit balance, if the
balance is used up, the insurance fee can be taken from the Top-Up Premium
Acquisition costs include costs for health checks, procurement of policies and
printing of documents, field fees, postal and telecommunications costs, as
well as remuneration for employees and marketing personnel.
The amount of administrative fees varies and depends on how the policyholder
chooses the frequency of payments.
Policy withdrawal and redemption fees
Fees charged when the policyholder makes a withdrawal of the Balance of the
Periodic Premium Unit or Redemption (Surrender) of the policy within a certain
Cost of switching investment funds
Fees on unit linked insurance for the transfer of investment funds or
Investment fund management fees
Fees on unit linked insurance used by insurance companies to manage joint
investment funds with Custodian Banks and securities.
Taxes charged for withdrawing or redemption of policies according to tax laws
Those are terms in insurance that are important to know
before registering personal insurance. This term includes acquisition costs,
cash value, premium leave, and sum insured.