What types of risks are commonly covered by facultative reinsurance?

Facultative reinsurance is used for large commercial properties, aviation, marine, energy, engineering projects, catastrophic risks, and specialized liability policies, where the primary insurer may not have sufficient capacity or expertise.

What is parametric insurance?

Parametric insurance is a type of coverage that pays a predetermined amount based on the occurrence of a specific event, rather than actual loss assessment.

Can a friend or distant relative have insurable interest in my life?

Generally, insurable interest is limited to close family members and financial dependents. Distant relatives or friends do not usually qualify unless they can prove financial reliance on the insured. This prevents people from taking out speculative insurance policies on acquaintances.

How long do long-term disability benefits last?

Benefit periods vary by policy. Some last a few years, while others continue until retirement age (usually 65). The longer the benefit period, the higher the premium cost.

What is Usage-Based Insurance (UBI)?

Usage-Based Insurance (UBI) is a type of insurance where premiums are based on the real-time behavior or usage patterns of the policyholder, often using telematics for auto insurance.

Can an insurer refuse to pay if a claim is within the policy’s limit of liability?

An insurer may refuse to pay if the claim is excluded from coverage, if the policyholder violated policy terms, or if the claim involves intentional wrongdoing or fraud. However, if a covered claim falls within the limit, the insurer must pay up to the stated amount.

What types of insurance policies use ACV for claim settlements?

ACV is commonly used in homeowners, auto, and commercial property insurance, especially for personal belongings, older structures, and vehicles that depreciate over time due to wear and aging.

What is the IRDAI?

The Insurance Regulatory and Development Authority of India (IRDAI) is a statutory body responsible for regulating and promoting the insurance industry in India, ensuring its growth and stability.