Financial Education

Insurance

Key Insurance Terms

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Assignment: The policyholder can transfer rights to another person, often for purposes like availing a loan.
Beneficiary: The person or entity entitled to receive benefits from a life insurance policy.<img style="max-width: 100%; height: 339px; float: right;" src="https://static.vikaspedia.in/mediastorage/filestorage/20251011202045_Copilot_20251011_200836(1).png" alt="Uploaded Image" width="509">
Death Benefit: The amount paid to the beneficiary upon the death of the insured person.
Exclusions:&nbsp;Specific conditions or circumstances under which the policy will not provide benefits.
Insurable Interest: The person taking out the policy must have a direct financial or emotional interest in the insured.
Lapsed Policy:&nbsp;A policy that becomes inactive due to non-payment of premiums.
Vesting Age:&nbsp;The age at which the policyholder begins receiving pension benefits under a pension-linked insurance plan.
Maturity Claim:&nbsp;The payout made to the policyholder at the end of the policy term.
Moral Hazard: The risk that the insured may behave recklessly because they are covered, increasing the chance of claims.
Sum Assured:&nbsp;The pre-defined amount the insurer agrees to pay in case of the insured&rsquo;s death.
Surrender Value:&nbsp;The amount paid to the policyholder if the policy is terminated before maturity.
Reinstatement:&nbsp;The process of reviving a lapsed policy and bringing it back into force.
Premium:&nbsp;The payment made by the policyholder to the insurer in exchange for coverage.
Nomination:&nbsp;The act of naming a person to receive the policy benefits in case of the policyholder&rsquo;s death.

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