BeNew Insurance

Replacement Cost The cost of replacing property without a reduction for depreciation due to normal wear and tear. In the insurance industry, "replacement cost" or "replacement cost value" is one of several methods of determining the value of an insured item. A replacement cost policy helps pay to repair or replace damaged property without deducting for depreciation. This type of coverage may be available for both your personal belongings and your home if they are damaged by a covered peril. For example: when a television is covered by a replacement cost value policy, the cost of a similar television which can be purchased today determines the compensation amount for that item. How Replacement Cost Works. Generally, if you have Replacement Cost Coverage, the insurance company may first pay you the actual cash value. Once the item is repaired/replaced and receipt(s) submitted, the company will reimburse you the extra money you paid to replace/repair the item.

Mechanical Breakdown Insurance Mechanical breakdown insurance is an insurance plan that provides broad protection from mechanical failure for the entire length of your term. Mechanical breakdown insurance is an optional add-on meant to cover trips to the mechanic not caused by an accident, therefore it is not covered under a standard auto insurance policy. Premiums attributable to policies covering repair or replacement service, or indemnification for that service, for the operational or structural failure of property due to defects in materials or workmanship, or normal wear and tear. (May cover motor vehicles, mobile equipment, boats, appliances, electronics, residual structures, etc.) For example, a busted engine or puncture in your air conditioner hose will be covered by MBI. MBI does not, however, cover routine tune-ups, tire issues or damages caused by poor maintenance on the driver's part. Any repairs caused by a car accident or crash go through your collision or comp

Subrogation Clause Section of insurance policies giving an insurer the right to take legal action against a third party responsible for a loss to an insured for which a claim has been paid. The insurance company is the principal, and the third party is the surety. Just a reminder; Subrogation is a term describing a right held by most insurance carriers to legally pursue a third party that caused an insurance loss to their insured. This is done in order to recover the amount of the claim paid by the insurance carrier to the insured for their loss. Examples of subrogation clauses include: Example 1. Filing an auto insurance claim against a third party driver Example 2. Trustee lenders subrogating trustee’s indemnity rights Example 3. Health insurance companies pursuing claims for third-party services. The purpose of a subrogation Clause is added to the insurance policy in order to recover the amount of the claim paid by the insurance carrier to the insured for the loss. It is you

Calendar Year Deductible and Plan Year Deductible A calendar year deductible is a set amount of money that you must pay out of pocket for medical expenses before your health insurance plan starts to pay for your care, begins on January 1st and ends on December 31st. Calendar-year deductibles reset every January 1st. A plan year deductible is similar to a calendar year deductible, but it resets on the renewal date of your health insurance plan. For example, if your health plan renews on May 1st, then your deductible would run from May 1st to April 30th of the following year, and reset on May 1st. A health insurance deductible is a set amount you pay for your healthcare before your insurance starts to pay. Once you max out your deductible, you pay a copayment or coinsurance for services covered by your healthcare policy, and the insurance company pays for the rest. As a general rule, the higher the deductible, the lower your premium, and vice-versa. These deductible types depend

Level Premium Insurance A life insurance policy for which the cost is equally distributed over the term of the premium period, remaining constant throughout. This can be a good option for people who want to budget for their life insurance costs and know that their premiums will not increase. Premium payments often start at a higher level than policies with similar coverage but are ultimately worth more than competitors as policyholders experience increased coverage over time at no additional expense. Permanent insurance like whole life with level-premiums will typically see the death benefit increase over time even as the premiums remain the same. The most common terms are 10, 15, 20, and 30 years, based on the needs of the policyholder. Level-premium policies are different than standard term life insurance policies, which have premium rates that rise as the policies age. Unlike stepped premiums, where the premium you pay increases with your age, while with level premium structu

Morbidity Risk Insurance Morbidity risk insurance is a type of insurance that protects policyholders from the financial impact of illness, injury, or other physical or psychological impairment, whether temporary or permanent. This type of insurance can cover a wide range of expenses, including medical bills, lost wages, and long-term care costs. for a person to experience Morbidity risk excludes the potential for an individual's death, but includes the potential for an illness or injury that results in death. Morbidity, is the frequency or severity of disease or illness within a subset of the population. It can range from Alzheimer's disease to cancer to traumatic brain injury. Morbidities are NOT deaths. Morbidity table on the other hand is a statistical record of the rate of illness among the defined age groups. If you are concerned about the financial impact of a serious illness or injury, morbidity risk insurance may be a good option for you. #benewinsurance #i

Speculative Risk Speculative risk is a category of risk that can be taken on voluntarily and will either result in a profit or loss. Almost all financial investment activities are examples of speculative risk, because such ventures ultimately result in an unknown amount of success or failure. Speculative Risk has three possible outcomes; something good (gain), something bad (loss) or nothing (staying even). Gambling and investing in the stock market may let to one of the three. Speculative risk are uninsurable because there is a lot of uncertainty about an event under consideration that could produce either a profit or a loss, for example gambling transaction. Almost all business activities and ventures qualify as speculative risks, from opening a new location to adding new items to the stock. As such, insurance companies will not directly insure the business’ profit. However, commercial insurance may cover the building, stock, equipment and other physical properties required t

Incurred But Not Reported (IBNR) (Pure IBNR) Incurred but not reported (IBNR) is a term used in the insurance industry to refer to claims that have occurred but have not yet been reported to the insurer. Claims that have occurred but the insurer has not been notified of them at the reporting date. Estimates are established to book these claims. May include losses that have been reported to the reporting entity but have not yet been entered into the claims system or bulk provisions. Bulk provisions are reserves included with other IBNR reserves to reflect deficiencies in known case reserves. IBNR can sometimes include estimates of incurred but Not Enough Reported (IBNER) Incurred but not reported (IBNR) is a reserve account used by insurance companies to compensate for claims that have not yet been reported. Incurred but not reported (IBNR) is most often associated with delayed reporting due to bureaucratic red tape and processing lag. For example, if there was a tornado, then

Premium An insurance premium is a periodic payment made to an insurance company in exchange for coverage against a specific risk. The amount of the premium is determined by a number of factors, including the type of insurance, the amount of coverage desired, the insured's age, health, and driving record, and the insurance company's risk assessment Premiums can paid using different modes in insurance base on the agreement between the insurer and the insured: -Lump sum: Pay the total amount before the insurance coverage starts. -Monthly: Monthly premiums are paid monthly. -Quarterly: Quarterly premiums are paid quarterly (4 times a year) -Semi-annually: These premiums are paid twice a year and are way cheaper than monthly premiums. Failure to pay the premium on the part of the individual or the business may result in the cancellation of the policy and a loss of coverage. The question is how premiums are being determined? This is duty of actuaries who work for insurance co

Lifetime Disability Benefit A provision in some disability income policies to recoup lost wages for the term of disability or remainder of insured's life in case of permanent disability and continues payments until the death of the insured. There are two main types of lifetime disability benefits: own occupation and any occupation. Own occupation policies pay benefits if you are unable to perform the duties of your own job, even if you can still work in another job. Any occupation policies pay benefits if you are unable to perform any job, regardless of your previous occupation. Here are some of the benefits of lifetime disability insurance: -Provides financial support if you become disabled and unable to work. -Can help you maintain your standard of living. -Can help you pay for medical expenses. -Can help you pay for long-term care. -Can help you protect your assets. Here are some of the drawbacks of lifetime disability insurance: -Can be expensive. -May have a waiting p

Multi-Peril Insurance is a type of insurance coverage that bundles multiple forms of coverages that are often needed together. You can find multiple peril insurance in a variety of industries. Examples include agriculture, business, machinery, and real estate. For example a Multiple Peril policy in covers in agriculture may be purchased for a loss of crop yields due to drought, freeze, disease, and other natural causes. Farmers who wish to buy a policy must do so before they plant their crops. An insurance provider is not liable to pay if the loss takes place due to the following conditions: Losses arising out of war, nuclear risks. Malicious damage and other preventable risk arising out of negligence by the farmer or the manpower employed by the farmer. Burning of the crop by order of a public authority. Here are some of the benefits of multi-peril insurance: -Convenience: A multi-peril insurance policy can save you the hassle of having to purchase multiple separate policies. -

Guaranteed Death Benefit A guaranteed death benefit is a benefit term that guarantees that the beneficiary, as named in the contract, will receive a death benefit if the annuitant dies before the annuity begins paying benefits. A guaranteed death benefit is a safety net if an annuitant dies while the contract is in the accumulation phase. There are two types of death benefit; An increasing death benefit which rises in value over years. The other options is a level death benefit, which remains unchanged whenever a person dies, be it shortly after purchasing a policy or many years down the road. The guaranteed death benefit received amount differs among companies and contracts, but the beneficiary is guaranteed an amount equal to what was invested or the value of the contract on the most recent policy anniversary statement, whichever is higher. The guaranteed death benefit period will terminate on the earlier of the guarantee period expiration date, as shown in the Schedule, or on

Product Liability Product liability refers to a manufacturer or seller being held liable for placing a defective product into the hands of a consumer. Insurance coverage protecting the manufacturer, distributor, seller, or lessor of a product against legal liability resulting from a defective condition causing personal injury, or damage, to any individual or entity, associated with the use of the product. This type of business insurance covers the cost of compensation claims if someone is injured or their property is damaged by a product that a manufacturer/producer has sold. Product liability insurance covers liability for compensatory costs, legal fees and any other costs associated with the case. You and I do not legally required to hold product liability insurance, but as a seller, supplier or manufacturer do, this is because they owe a duty of care towards their customers. #benewinsurance #insurtech #inclusiveinsurance #insurance #reinsurance #takaful

Operations Policy Policies covering the liability of an insured to persons who have incurred bodily injury or property damage on an insured's premises during normal operations or routine maintenance, or from an insured's business operations either on or off of the insured's premises. Most visitors to your business this policy protects fall into one of three categories: -Invitee: A person who is asked to visit the property (e.g a customer) -Licensee: Someone who is permitted to enter the property, but has not been invited (e.g., delivery persons, utility workers) -Trespasser: Someone who is neither invited nor permitted to enter a property, trespassers (e.g., burglars or vandals) #benewinsurance #insurtech #inclusiveinsurance #insurance #reinsurance #takaful

Pure Risk Pure risk is a category of risk that are beyond human control and has two outcomes: complete loss or no loss at all. There are no opportunities for gain or profit when pure risk is involved. Only pure risks are insurable because they involve only the chance of loss. They are pure in the sense that they do not mix both profits and losses. Insurance is concerned with the economic problems created by pure risks. Pure risks can be divided into three different categories: -Personal Risk – includes threats to your life or your physical well-being. -Property Risk – includes threats to your personal or business property. -Liability Risk – includes threats to your financial well-being at the hands of others claiming injury or death alleging you to be at fault. Simply put pure risk may be floods, fires, earthquakes, and hurricanes, as are unforeseen incidents, such as acts of terrorism or untimely deaths. A simple illustration of pure risk; For example, should a person damage

Return of Premium Rider A return of premium rider typically refunds you the total premium you paid for your base policy. It may not refund fees or the premium you paid for other riders on your policy. Being late on payments may reduce your refund or disqualify you from receiving one at all. For most types of term insurance, if you have not had a claim under the policy by the time it expires, you get no refund. But some insurers have created term life with a "return of premium" feature, which returns part or all of the money you have already paid if you have not used the policy once your term ends. It works by providing you, the policy holder, a return of your premium if you are still alive when your term policy comes to an end. For example, if you purchased a 20-year term policy at age 30 and now, 20 years later at age 50 you're still alive, your money will be refunded to you. A rideris an amendment to a policy agreement. With ROP, either your beneficiaries get the

Self Insurance A method in risk management in which a company or person sets aside a sum of money so they can use it to mitigate an unexpected loss, rather than pay premium to an insurance company to cover that unexpected loss. A typical self Insurance example is when an employer takes on the risk of providing health insurance coverage for their employees. Second example is when owner of a building situated atop a hill adjacent to a floodplain may opt against paying costly annual premiums for flood insurance. Instead, they choose to set aside money for repairs to the building if in the relatively unlikely event floodwaters rose high enough to damage their building. One the advantages of self insurance is that while you are disaster-free, you get to pocket the money you would have paid in insurance premiums. This can end up saving you a lot of money, especially if you don't incur a financial loss. The biggest disadvantage of self insurance is that the individual or compan

Professional Errors and Omissions Liability Errors and omissions insurance, also known as E&O insurance and professional liability insurance, helps protect you from lawsuits claiming you made a mistake in your professional services. This insurance can help cover your court costs or settlements, which can be very costly for your business to pay on its own. A coverage available to pay for liability arising out of the performance of professional or business related duties, with coverage being tailored to the needs of the specific profession. Examples include abstracters, accountants, insurance adjusters, architects, engineers, insurance agents and brokers, lawyers, real estate agents, stockbrokers, doctors, lawyers, and wedding planners. Is should be noted that professional liability and errors and omissions are the same. Errors and omissions insurance is another name for professional liability insurance. So, the same coverage is applied despite the different names. The differ

Protection and Indemnity (P&I) Insurance P&I insurance, is a form of mutual maritime insurance provided by a P&I club. It provides cover to shipowners, operators, and charterers for third-party liabilities encountered in the commercial operation of entered vessels. Whereas a marine insurance company provides "hull and machinery" cover for shipowners, and cargo cover for cargo owners, a P&I club provides cover for open-ended risks that traditional insurers are reluctant to insure. It is a broad form of marine legal liability insurance coverage. A typical P&I policy covers loss of life, injury and illness of crewmembers, passengers, and other third parties, damage to cargo on board the vessel, damage to other floating objects not caused by collision, wreck removal costs, collision liability, damage to fixed objects. To an extend P&I insurance is compulsory. Over 90% of the world's merchant fleet is entered with the P&I clubs which provide t

Roadside assistance Cover (An Add-on or Extension) This is a very useful add-on cover that offers you emergency services such as towing your vehicle to a nearby service station, arranging for alternate transportation, providing ambulance services, changing flat tyre, arranging hotel accommodation, etc. It comes in handy if you happen to be stranded in a desolate place with a vehicle issue. You will just have to call your insurance provider and request for help. A standard roadside assistance includes: Towing, flat tire, dead battery, lockout assistance, gas delivery. If you don't have roadside assistance, you'll have to call a towing company or mechanic if your car breaks down. You will also have to pay for any service you need out of pocket. The insurance company will get in touch with the network garage nearest to your location and send immediate assistance. The RAC's Breakdown Cover will get you back on the road and give you complete peace of mind. #benewinsura

Structured Settlements Periodic fixed payments to a claimant for a determinable period, or for life, for the settlement of a claim agreed upon by the claimant and his/ her insurer. Unlike stocks, bonds and mutual funds, structured settlements do not fluctuate with market changes. Payments are guaranteed by the insurance company that issued the annuity. What is good with structured settlement is that you can sell your structured settlement to a factoring company for immediate cash. Although you must first obtain court approval, you have the legal right to sell your payments, either in part or in full, to a structured settlement buyer. #benewinsurance #insurtech #inclusiveinsurance #insurance #reinsurance #takaful

Term Conversion Rider Also known as a "convertible" allows you to convert a term life policy into a permanent (whole) life insurance without additional evidence of insurability; medical exam. A rider is an insurance policy provision that adds benefits to or amends the terms of a basic insurance policy to provide additional coverage. Regarding the Cost of Converting there are no fees to convert a term policy to a permanent policy. However, the rate you pay for coverage your premium will increase. How much it increases depends on several factors. Remember your health will not be a factor because you lock in your original underwriting class, your age when you convert will affect your rate. The older you are, the higher your premium will be. #benewinsurance #insurtech #inclusiveinsurance #insurance #reinsurance #takaful