The sum insured for the vehicle is called Insured's Declared Value and should reflect the current market value of the vehicle. Under Liability insurance, Third Party Liability insurance is covered. There is unlimited coverage to Third parties injury and Third party property damage is covered up to a sum of Rs 7,50,000. The Insured has the option to restrict coverage for Third Party Property damage to Rs 6,000 and this will result in a lower Liability Only premium.

Deductible or excess is the amount over and above, which the claim will be payable. There is a normal standard/compulsory excess for most vehicles ranging from Rs 50 for two-wheelers to Rs 500 for Private Cars and Commercial Vehicles which increases depending upon the cubic capacity/carrying capacity of the vehicle. However, in some cases the insurer may impose additional excess depending upon the age of the vehicle or if there is high frequency of claims.

If there are any changes in the policy like change of address or modifications to the vehicle or its use, it will be done by an Endorsement by the insurance company. Submit a letter to the insurer with proof for the changes and obtain the endorsement. Some endorsements may require you to pay additional premium. Check the correctness of the endorsement.

As per Rule 141 of Central Motor Vehicle Rules 1989, a certificate of Insurance is to be issued only in Form 51. It is only in Motor Vehicle Insurance, apart from the policy, that a separate certificate of insurance is required to be issued by insurers. This document should always be carried in the vehicle. The policy should be preserved separately at home / office.

If you have commercial insurance, insurers negotiate payment rates with hospitals. These rates can differ among companies, where larger insurers tend to demand bigger discounts. The demands for discounts by commercial insurance companies create further complexity for hospitals and patients to determine the true cost of any given procedure.

Commercial insurers do not pay full hospital charges. Furthermore, numerous factors, such as the type of plan, co-pay amount, co-insurance amount, deductible, out-of-pocket maximums and other limitations will affect the individual's financial responsibility to a hospital. Therefore, it is crucial that you begin by talking to your insurance company to understand all of the factors affecting your financial responsibility.

Charge Definition: The amount a hospital sets for total services provided to the patient before any insurance discounts. Similar to a sticker price, it is usually not the final amount paid. Reimbursement: The amount a commercial insurer pays to the hospital for inpatient stay from commercial insurance provider. Rates are negotiated between the insurance company and the hospital. Out-of-pocket costs: The amount a patient pays to the hospital after reimbursement from commercial insurance provider (for example, deductible or co-pay). Example of a charge breakdown:

Knee replacement total charge: $38,000

Hospital reimbursement: In this example, the insurance company has negotiated a 30 percent discount with hospital. Therefore, the hospital will receive $26,600 from the insurer. Out-of-pocket cost: Commercial insurance deductible is $1,000.

In this example, the hospital will receive $26,600 for a $38,000 charge. This illustrates that the charge or sticker price is often not the final amount paid.

If you have Medicare or Medicaid, the government sets the rates for how much is covered. Like commercial insurance, there may be some out-of-pocket costs. Medicare is a health insurance program for people age 65 or older or people under 65 with certain disabilities or conditions. For Medicare, hospitals generally receive payment of only 86 cents for every dollar of actual cost of providing care. (Source: American Hospital Association) Medicaid is a joint federal and state program that helps with medical costs for people with low incomes. For Medicaid, hospitals generally receive payment of only 89 cents for every dollar of actual cost of providing care. (Source: American Hospital Association)

ULIPs offered by different insurers have varying charge structures. Broadly, the different types of fees and charges are given below. However it may be noted that insurers have the right to revise fees and charges over a period of time. Premium Allocation Charge
This is a percentage of the premium appropriated towards charges before allocating the units under the policy. This charge normally includes initial and renewal expenses apart from commission expenses. Mortality Charges
These are charges to provide for the cost of insurance coverage under the plan. Mortality charges depend on number of factors such as age, amount of coverage, state of health etc. Fund Management Fees
These are fees levied for management of the fund(s) and are deducted before arriving at the Net Asset Value (NAV) . Policy/ Administration Charges
These are the fees for administration of the plan and levied by cancellation of units. This could be flat throughout the policy term or vary at a pre-determined rate. Surrender Charges
A surrender charge may be deducted for premature partial or full encashment of units wherever applicable, as mentioned in the policy conditions. Fund Switching Charge
Generally a limited number of fund switches may be allowed each year without charge, with subsequent switches, subject to a charge. Service Tax Deductions
Before allotment of the units the applicable service tax is deducted from the risk portion of the premium. Investors may note, that the portion of the premium after deducting for all charges and premium for risk cover is utilized for purchasing units.
Category Name : Unit Linked Insurance Policies

One has to verify the approved sales brochure for.

• All the charges deductible under the policy
• Payment on premature surrender
• Features and benefits
• Limitations and exclusions
• Lapsation and its consequences
• Other disclosures
• Illustration projecting benefits payable in two scenarios of 6% and 10% returns as prescribed by the life insurance council.

NAV is the value of each unit of the fund on a given day. The NAV of each fund is displayed on the website of the respective insurers

Yes, Products may have the "Partial Withdrawal" option which facilitates withdrawal of a portion of the investment in the policy. This is done through cancellation of a part of units.

a) Discontinuance within three years of commencement - If all the premiums have not been paid for at least three consecutive years from inception, the insurance cover shall cease immediately. Insurers may give an opportunity for revival within the period allowed; if the policy is not revived within that period, surrender value shall be paid at the end of third policy anniversary or at the end of the period allowed for revival, whichever is later.
b) Discontinuance after three years of commencement - At the end of the period allowed for revival, the contract shall be terminated by paying the surrender value. The insurer may offer to continue the insurance cover, if so opted for by the policy holder, levying appropriate charges until the fund value is not less than one full year's premium. When the fund value reaches an amount equivalent to one full year's premium, the contract shall be terminated by paying the fund value.
c) Policies having 5 year lock-in-period: For policies bought on or after 01-09-2010, lock in period has been increased to 5 years. Upon discontinuance of the payment of premium, the policyholder has the option of (i) Reviving the policy or (ii) Complete withdrawal without any risk cover.
A notice shall be sent by the insurer giving the above options, within 15 days from the date of expiry of grace period, if no option or option (ii) is exercised within 30 days of such notice, the proceeds of discontinued policy shall be refunded but not before the completion of the lock-in period. If such discontinuance is within lock in period, the policyholder shall have the right to revive the policy within a period of two years from the date of discontinuance but not later than the expiry of the lock-in period.

The financial interest that the assured possesses in whatever is being insured is known as -Insurable interest-. In other words, it is the right of a person to insure something which, when lost or damaged, would mean a financial loss to him.
If a person is allowed to insure something that he does not own it becomes a wagering contract and therefore void under Section 30 of Indian Contract Act.
Therefore Insurable interest is a pre-requisite for insurance and the compensation is limited by the value of the subject matter of insurance and the extent of insurance coverage. In Life Insurance, though human life value cannot be measured in monetary terms, insurers determine the sum assured as a multiple of the income of the life assured and his remaining productive years.

An insurance agent can represent only one insurer and do business for him. An insurance Broker is basically the representative of the customer and can sell the policies of more than one insurer. In the Indian context an Agent can represent one Life insurer, one Non-Life insurer and one Health insurer. In addition he can represent one credit insurance company and agricultural insurance company too.
Detailed regulations have been framed by Insurance Regulatory and Development Authority (IRDA) for both Agents and Brokers and they govern them.

The purpose of insurance is to compensate you for a loss caused by an insured perils. If your stocks are destroyed in a fire, the cause of loss is fire which is payable under a fire policy. If the stocks are stolen, the loss is not payable under a fire policy as "Burglary" is not a covered peril.

In some policies there is a clause that a specified amount will be deducted from the claim amount. For example in Industrial Risks 0.5 per cent of the total sum insured subject to a minimum of Rs.1 lakh is the deductible if loss is due to Terrorist Act. This means that the first Rs one lakh of any claim and up to 0.5 per cent of the claim has to be borne by the insured. If the loss is below Rs one lakh then no claim is payable.
This is a way for the insurance companies to avoid the administrative costs of small claims and the insured is usually given a premium rebate for accepting this burden.

Corporate clients, who want to oblige more than one insurer, or benefit from the competitive forces among insurers, place their insurance business with more than one insurance company. While doing so, they select one company as the "Leader" who is given higher share of premium and others are given lesser share. Client deals only with the "Leader". The leader will share the premium (in the ratio decided by the client) as well as claims with other participating insurers who are called Co-insurers. Depending on the total volume of premium, it can be placed with 2, 3, 4 or more insurers.