What is a facultative certificate in reinsurance?

A facultative certificate is a formal document issued by the reinsurer, confirming acceptance of a specific risk and detailing the agreed-upon coverage, premium, terms, and conditions of the facultative reinsurance agreement.

How is parametric insurance different from traditional insurance?

Traditional insurance compensates for actual losses after assessment, while parametric insurance pays based on predefined event triggers, ensuring quicker financial relief.

Can an ex-spouse have insurable interest after divorce?

Typically, insurable interest in an ex-spouse ceases after divorce unless financial obligations, such as alimony or child support, exist. However, if a life insurance policy was taken out while married, it remains valid even after divorce, unless modified or canceled by the policyholder.

How does long-term disability insurance differ from Social Security Disability Insurance (SSDI)?

SSDI is a government program with strict eligibility criteria and long wait times. LTD insurance provides faster, more reliable income replacement and offers more flexible benefit terms.

Is UBI only available for auto insurance?

While UBI is most commonly associated with auto insurance, it is also emerging in other areas like health insurance or home insurance, where premiums may depend on specific behaviors.

Can liability limits be negotiated with an insurer?

In some cases, policyholders can negotiate higher limits, especially for commercial insurance policies. However, approval depends on risk assessments, underwriting evaluations, and the insurer’s willingness to assume additional exposure.

How does ACV affect homeowners insurance claims?

In homeowners insurance, ACV is used for personal belongings and older structures, reducing the payout based on depreciation, which may result in lower compensation than the cost to replace the lost property.

How does IRDAI ensure consumer protection?

IRDAI ensures consumer protection by enforcing guidelines on policy terms, fair practices, transparency, grievance redressal mechanisms, and setting standards for insurance product offerings.