Insurance documents use precise language, and the precision is what decides claims. These are the terms worth knowing before you sign anything.
Premium
The amount you pay to keep the policy in force, payable monthly, quarterly, half-yearly, annually or as a single payment.
Sum insured
The maximum the insurer will pay under the policy. In life insurance this is usually called the sum assured.
Deductible
The amount you bear yourself before the policy responds. Higher deductibles reduce premium — this is the mechanism behind super top-up plans.
Co-payment
A fixed percentage of every claim that you pay, common in senior citizen policies.
Rider
An optional add-on attached to a base policy, such as accidental death, critical illness or waiver of premium.
Nominee
The person you name to receive the benefit. Keep this current — an outdated nominee causes real distress at claim time.
Exclusion
A situation or condition the policy does not cover. Exclusions are listed in the policy wording and are the first thing an insurer checks.
Waiting period
The time that must pass before certain conditions become claimable.
Free-look period
A window after receiving the policy in which you may return it for a refund of premium, less costs.
Grace period
Extra time allowed after a due date to pay premium without losing cover.
IDV
Insured Declared Value — the maximum payable on total loss of a vehicle.
Portability
Moving a health policy to another insurer while carrying forward accrued waiting-period credit.