Discover the types of policies for different insurances

The problem is that many people feel confused by the huge amount of terms and nomenclature that surround the insurance contract. An example of this is the insurance policy, which many people still don’t know what it means.

To prevent these issues from becoming an obstacle when closing an agreement with an insurance company, we will explain in this post what it means and what the different types of policies exist on the market. Check out!

What are the most common types of insurance?

When taking out insurance, we are trying to protect ourselves against possible damages that could cause material losses or be converted into monetary value. Therefore, there are different types of situations or objects that can be insured. Look at some examples.

Automobiles

Automotive insurance against theft and theft guarantees the insured person compensation for the market value of the vehicle in the event of an accident , that is, the occurrence of the damaging event provided for in the contract — which, in this case, would be the theft or theft of the automobile.

In car insurance, it is also possible to take out different coverages, which protect the vehicle and the driver in other situations, such as traffic accidents, fires, collisions, etc.

Laptops

Another example that is currently very popular is the insurance of portable objects , such as notebooks, cell phones and tablets. Given the high value of these goods and the enormous amount of theft that occurs in large cities, it is not worth leaving them unprotected.

Insurance, in this case, guarantees reimbursement of the value of the item (if it is stolen) or repairs (in case of damage to the device).

Residence

A house is one of the most precious possessions a person can own. Given the amount of potentially dangerous unanticipated events that might occur, leaving it unsecured is not an option.

Residential insurance aims to protect properties against theft, robbery, fires, explosions, lightning strikes and various other events that can cause material damage.

Trip

No matter how much you plan a trip, it is not possible to guarantee with 100% certainty that no unforeseen events will happen. Therefore, it is important to take out insurance so that your trip goes smoothly and goes the way you planned, even if an emergency happens.

Travel insurance guarantees assistance in the event of accidents, flight delays, lost luggage, among many other risks. It is also possible to count on services such as transfers and emergency accommodation.

Life

Life insurance’s main objective is to ensure that the insured’s family members receive compensation in the event of a fatality. Depending on the terms of the contract, this compensation may be in the form of a lifetime income or a previously stipulated full amount.

But this insurance is not only used in the event of death. It also serves to protect against accidents that cause the insured’s temporary or permanent disability, guaranteeing the payment of compensation in accordance with the terms of the contract.

What is an insurance policy?

As we mentioned, insurance is nothing more than a contract concluded between two parties — the insured and the insurer. Therefore, as with any other type of contract, there must be a specific document to confirm the terms of the agreement. This document is the policy.

The main points mentioned in the insurance policy are:

  • description of the insured property;
  • definition of coverage and guarantees;
  • rights and duties of the parties.

When taking out a policy, the insured is formalizing the contract with the insurer, confirming all the terms and clauses set out in the document. In other words, he is accepting all the conditions of validity and activation of the insurance, including the value of the premium, the indemnity conditions and the value of the deductible.

As the policy must clearly express the smallest details of the contract, it is essential that the insured read all the terms to make sure they are getting what they want. It is necessary to pay particular attention to the special and particular conditions of the document, as they restrict or alter the general conditions, modifying, for example, insurance validity hypotheses.

When thinking about taking out insurance, it is interesting to compare policies from different insurers to assess which one is most advantageous , offering the best coverage and indemnity conditions.

Finally, the policy is also used to resolve doubts about insurance. Therefore, if there is any conflict between the insured and the insurer, this document should be used as a form of solution, considering that all the information is provided in it.

Who are the parties involved in taking out insurance?

Strictly speaking, there are several parties involved in an insurance contract. However, it is common for two or three of them to be represented by the same person, as happens in cases where the insured is the beneficiary in a car insurance policy, for example.

Insurance company

The insurer is the company that assumes the risk of the contracted coverage and, in the event of an accident, provides the respective compensation as specified in the policy. To be an insurance company, the company must have authorization from the Private Insurance Superintendency (SUSEP); otherwise, it will be clandestine.

Stipulator

This figure only appears in collective contracts. It can be a natural or legal person and, in practice, mediates insurance for groups of people.

Insured

The policy insured is the person whose interests are protected by the insurance. Thus, in life insurance, for example, the insured is the person who receives compensation if he or she dies.

Recipient

The beneficiary, who can be more than one person, as long as this is indicated in the policy, is the individual who will receive the compensation provided for by the insurance. The beneficiary, for example, in life insurance can be a child or wife who will receive it upon the death of the father, when he is the insured person. With car insurance, you will always be the owner of the vehicle.

There is a fifth figure between the insurance parties. Although it is not included in the policy, it is essential in building the relationship between the insured and the insurer — the insurance broker .

It is the broker’s guidance and indications that provide the best path for an interested party to obtain the insurance they need. Therefore, it is your insurance broker who brings you the best proposals according to the expectations you present.

What should be included in the insurance policy?

As we have shown, the policy is the document that formalizes the insurance contract between the parties involved and sets out the different coverages contracted. To achieve this objective, it is made up of numerous clauses that can be grouped into three types — general, special and particular.

See below what is covered by each type of clause. This makes it much easier to understand an insurance policy.

General clauses

In a generalized way, it can be considered that under the general clauses are those that establish the obligations between the parties, that is, the rights and duties of everyone involved, as well as the items covered by insurance.

Special clauses

Special clauses are intended to complement or amend the general clauses of the policy. They are the ones who consider, for example, the additional coverage requested by the stipulator.

Private clauses

Particular clauses are those that change general and/or special clauses, but with different approaches, for example, for each beneficiary. The private clauses detail the benefits, coverage and other personalized details.

Given all these clauses, an essential precaution that must be taken by every insured person is a detailed review of the policy. It is necessary to check that all the information is present and correct.

What are the types of policies?

In addition to there being different types of insurance and coverage, there are also different types of policies. Although it is just a matter of nomenclature for contracts with different characteristics, it is important that you know how to distinguish them so as not to get confused when closing an agreement with the insurance company.

Insurance ticket

This is the guarantee contracted in insurance sold on a mass basis, for example, cell phone insurance purchased together with the device. The company that sells is the representative and is responsible for issuing the insurance ticket and collecting the premium amount, instead of the insurance company. She represents the insurance company.

Individual or collective policy

This distinction is mainly used in life insurance cases. It serves to distinguish the contract made with just one insured person (individual) from that made by companies, associations or institutions made up of several people with common interests (collective).

Compulsory policy

In mandatory insurance — DPVAT, condominiums, etc. —, the policy is compulsory, that is, its terms cannot be negotiated between the parties, as it is a legal obligation.

Named Perils Policy

When opting for the named risks policy, the contract conditions will be limited to specific cases. The insurance will only cover the risks expressly provided for in the contract, which will be individualized. This insurance is normally taken out by medium and large companies that carry out specific activities.

Comprehensive or multi-risk policy

Unlike the previous one, the comprehensive policy covers risks of different natures that would normally be covered by insurance from different lines. An example of this is the policy for companies, which can cover both financial loss to the insured and to their assets.

Understanding the differences between types of insurance policies is important to get used to the terms used in contracts and avoid confusion. In any case, it is good to have the support of an insurance broker, so you can consult him to resolve any doubts.

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