Can a beneficiary be an entity rather than a person?

Yes, a beneficiary can be an entity, such as a trust, charity, or business. Entities are often named in life insurance policies for estate planning purposes or to ensure the longevity of a business.

How does misrepresentation affect an insurance contract?

If a policyholder provides false or incomplete information, the insurer may void the contract, deny claims, or adjust premiums due to increased risk exposure.

What is the difference between indemnity-based and index-based agricultural insurance?

Indemnity-based insurance compensates farmers based on actual losses assessed in the field, while index-based (or parametric) insurance pays out when weather conditions exceed predefined thresholds. Index-based insurance is often preferred for weather-related risks due to its faster payout process and lower administrative costs.

Is collision coverage required by law?

No, collision coverage is not legally required. However, if you lease or finance your vehicle, the lender may require it as part of the loan agreement.

What is the grace period in an insurance policy?

The grace period is the additional time, typically 30 days, given after a missed premium payment before the policy officially lapses or is canceled.

Does home insurance cover natural disasters?

Home insurance usually covers some natural disasters like windstorms and hail but often excludes floods and earthquakes. Separate policies or endorsements are needed for protection against these high-risk events. Check policy details for specific coverage.

How did life insurance develop in ancient civilizations?

Early insurance systems included Babylonian bottomry contracts and Roman burial societies. These provided financial support to families and communities after a member’s death.

What is a sliding scale commission in a reinsurance treaty?

A sliding scale commission adjusts the commission rate paid to the cedent based on the loss experience of the treaty, incentivizing the cedent to maintain lower losses.