Commencement Date/Effective Date

Commencement Date The commencement date in insurance is the date on which the insurance coverage takes effect. It is also known as the effective date or policy start date. The commencement date is usually specified in the insurance policy. For most types of insurance, the commencement date is the date on which the premium is paid. However, there are some exceptions. For example, in life insurance, the commencement date is typically the date on which the application is approved, even if the premium is not paid until later. The commencement date is important because it determines when the insurance coverage begins. For example, if you purchase a health insurance policy on January 1st, but the commencement date is February 1st, you will not be covered for any medical expenses that you incur between January 1st and February 1st. The commencement date is also important for calculating the surrender charges. Surrender charges are fees that you may have to pay if you cancel your insurance policy early. The surrender charges are typically calculated as a percentage of the premiums that you have paid, and they are usually highest in the early years of the policy. In disability Insurance commencement date is the first day a disability is covered. It immediately follows the completion of the waiting period. Simply put the Commencement Date in disability insurance is the next day immediately following completion of the the Benefit Waiting Period. The Benefit Waiting Period is the period, measured from the first day of your Disability, throughout which you must be Disabled before Disability Benefits become payable. #benewinsurance #insurtech #inclusiveinsurance #insurance #reinsurance #takaful