A glossary to understand all insurance concepts.
Hiring insurance can be challenging due to complex concepts used by professionals. We have gathered in this glossary all the terms you should know to be able to subscribe to insurance in an informed manner.
Do you want to hire new insurance or review your insurance portfolio? You are in the right place: the insurance brokers of Poupança no Minuto are here to help you. But before diving into an insurance process, better understand the terms that will be used.
Insurance company
An institution that carries out the activity, legally registered, and enters into insurance contracts with clients or companies.
Insurance policyholder
The client or company that hires the insurance to the insurer is responsible for paying the premium.
Insured
The insured is the person who is protected by the insurance contract, whether individual or collective. They may or may not be the policyholder.
Safe capital
The insured capital is the value corresponding to the maximum amount reimbursed by the insurer in case of a claim, agreed upon between the client and the institution in the policy. If the claim amount exceeds this value, the insurer only covers the insured capital defined in the contract.
Franchise
The franchise is the amount the insured is responsible for in case of a claim, as determined in the contract. The insurer only covers from a certain amount, all below that is the franchise paid by the customer. It can be a fixed amount or percentage.
Award
The prize is the amount paid for insurance, which can be paid in monthly, quarterly, semi-annual or annual installments. The value is calculated based on factors such as the type of insurance, the client's age, gender, lifestyle habits, and health history.
Insurance policy
The insurance policy is the combination of the documents that form the contract between the insurer and the insured customer. These include information about the conditions of the insurance (general, special, and particular) and any additional contract amendments.
General, special, and specific conditions.
General conditions refer to the basic clauses of insurance, applied to most insurance policies in the same branch. It includes general coverage and exclusions, as well as the rights and obligations of both parties. Special conditions refer to the specificities of the insurance, such as extra risk coverage. And particular conditions include the conditions that have been defined, regarding the covered risks, premium, policyholder, insured party, the start and end date of the policy, or other important characteristics.
Grace period
The waiting period exists in specific insurances, such as health and animal, and represents a time frame during which the insured cannot use the insurance. This period occurs immediately after contracting the insurance. That is, during this period between contracting and being able to use it, one is prevented from activating coverages or benefiting from the conditions. The goal is for the insurance company to protect itself from situations of fraud or exploitation.
Exclusions
In certain insurance policies, there are specific coverage exclusions. Therefore, you must always pay attention to the exclusion clause in the insurance contract you are subscribing to.
Duplicate coverage
If you have more than one insurance policy, even if they are different, you may run the risk of contracting duplicate coverage. You should consult the policies of the other insurances you have contracted to verify that you are not left with unnecessary duplicate coverage.
Compensation for absolute temporary incapacity (ITA)
Temporary Absolute Incapacity (ITA) occurs when the insured suffers from an illness or accident that incapacitates them from carrying out their professional activity for a certain period of time. The compensation corresponds to the amount that the worker is entitled to when incapable of performing their job, receiving a daily compensation of 70% of their salary for the first 12 months and 75% after that period. The insured stops receiving this amount when a cure is verified or permanent disability is considered.
Update of the outstanding debt amount
Allows the value of the insurance to correspond to the outstanding amount in case of triggering the insurance in case of a claim, the bank is entitled to the corresponding amount of the debt at that moment, which will be settled.
Co-funded percentages
Percentage covered by the insurance company for each claim.
Available capital
Available coverage value for each year.
Payment method
It corresponds to the way in which payment for services is made. For example, in health insurance, it can be through a reimbursement system, where the insured pays and is then reimbursed the portion covered by the insurance, or through direct discount on the payment of the service.
Actuarial age
The age of the insured at the start or renewal of the contract is considered, with the date closer to the birthday being taken into account. If more than 6 months are left until that date, the current age is considered, but if less than 6 months are left, the age is rounded up to the next year.
Insurance termination.
The date of termination of insurance coverage may be defined in the contract, ending by expiration. If a contract does not specify an end date, it may automatically renew. Therefore, if you need to terminate the insurance, you must send a notice at least 30 days in advance (check the contract, as it may be up to 90 days). Termination can also be done by revocation if the insurer and the policyholder both agree, or by withdrawal within 14 or 30 days after receiving the policy.
Were you left in charge of insurance? Shall we proceed with your process then? Speak directly with the insurance mediators at Poupança no Minuto, and show that you can speak "insurance-ese".