Great, you got insurance. But do you understand the coverage and other terminologies written on the contract? If you are new to insurance, let us help you with the important terminologies you should know by heart.
Premium Payment Terms
Before you even sign an insurance policy, it’s good to understand the payment terms. It allows you to plan and assess your capability to pay based on the terms of payment.
Regular Payment – regular payment means you have the option to pay the premium monthly, quarterly or annually. This payment option is for people who are on a limited income who cannot pay the entirety of the insurance policy.
Limited and Single Premium Payment – when the payment terms say limited, it is almost similar to a regular payment except to the fact that it would be five years minimum. For example, you may opt to pay the premium well for five, ten, twenty years or more. Single premium means paying in a lump sum or all in one go.
Grace Period and Due Date
If you chose to pay regularly, there would be a due date and a grace period. It is important when taking out health insurance for 18 years as it would determine your coverage during an emergency. The last thing you want is to miss the grace period. If you fail to pay before the grace period, the insurance could come back as large preventing you from claiming the benefits stated on your contract.
Riders are extra coverage that an insurance company may offer. For example, extending the insurance from life assured to your chosen nominee. Riders are great for people with medical expenses for child 18 years deductible, as they can add coverage without having to sign up for other insurance. Be sure to check the rider’s terms to see if the additional insurance cost is something you need.