5 Insurance Terms Every Millennial Should Know
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5 Insurance Terms Every Millennial Should Know

  • Highlights

  • Understand insurance terms to know the true coverage

  • A beneficiary is the person who gets benefits from the policy

  • Exclusions mark circumstances that aren’t covered by the policy

  • Know the difference between riders and premium

As a millennial who has just started working, you may consider insurance to be an add-on expense. However, don’t neglect buying insurance for this reason alone. It is essential to remember that your insurance is only as good as the plan or policy you select, and there are affordable options that you can choose from. Also, in order to find the ideal insurance policy for yourself or to make the most of your existing plan, it is important that you understand the various terms associated with insurance. So, take a look at the top 5 insurance terms you must familiarise yourself with.

Premium

A premium is the amount of money that you pay to avail insurance cover. This amount can either be one that is paid on a monthly basis, or one that is paid on a yearly basis. Premiums act as a payment in exchange for which the insurer caters to your need for coverage, if and when such a need arises.

Beneficiary

A beneficiary is someone who benefits from or receives the insurance payout. An insurance policy can have more than one beneficiary. So, in order to divide the payout efficiently, you can assign a percentage of the payout to each beneficiary in advance if you have more than one beneficiary.

Rider

A rider is an add-on to your insurance policy. These aren’t necessary or mandatory and you can choose add-ons as per your convenience and needs. In order to purchase a rider for your insurance policy, you will need to pay an additional premium.

Exclusions

Exclusions list the circumstances under which the policy does not apply. This means if your situation falls under the list of exclusions, you cannot avail insurance benefits or make a claim against your insurance policy.

Deductible

In the simplest terms, deductible is the pre-determined amount that you have to pay when you make a claim. It is the degree to which you will take financial responsibility in an emergency situation or when faced with damages. The insurer will provide for the balance amount. Typically, you have to decide upon your deductible when you’re taking an insurance policy.

Now that you have understood the most important insurance terms, you compare various policies better and can choose the ideal insurance policy for your needs. As Bajaj Finserv brings to you a host of insurance policies such as holiday insurance, card protection plans, cycle insurance, trek cover, and more, you can take protect all the items and experiences that you wish to at a nominal price.

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