The policyholder and the insurer are participants in relations in the insurance industry. Consider this issue in more detail.
Guaranteed total security is impossible in our life in principle, but it is possible and even necessary to minimize some risks, protect ourselves and our loved ones from unforeseen circumstances that could cause financial or any other harm to our health, life, condition of property. It is enough to conclude an insurance contract and pay for insurance. There are many centuries of insurance history; even in the Middle Ages, merchants had the opportunity to insure their property.
Insurance today
Today it is a special sector of our economy, the activity of which is aimed at ensuring the protection of people, business and property from dangers. One way or another, we face daily insurance activities. Therefore, knowledge of the basic concepts (policyholder, insurer, insurance, insurance policy) used in insurance contracts is necessary at least at the lowest possible level. Comprehensive insurance coverage is provided by various types of insurance activities, such as primary insurance, co-insurance and reinsurance.
So where are the insurer and policyholder involved? Let's get it right.
Insurance Participants
Typically, the insurer is a legal entity that has a license and other permits, which directly carries out the insurance process.
The policyholder-insurer relationship is of interest to many.
In simple terms, the insurer is the party whose responsibilities include the implementation of financial activities to insure something or someone in order to compensate for losses after the occurrence of insured events specified in the insurance contract. And the policyholder is the one to whom the losses will be reimbursed. This can be a legal entity or an individual. The insurer and the policyholder enter into legal relations with each other. The insurer, carrying out its activities should be guided only by the insurance interests of the client. The objects of insurance can be a variety of objects, things, conditions or even individual parts of the body. Most often, contracts are concluded for health insurance, real estate, cars, etc.
The insured must be aware of the rights and obligations of each of the parties. Since sometimes very, very considerable amounts depend on this knowledge.
Rights and obligations of the insurer
The insurer has the right:
- Get full information about the insured and the object of insurance.
- Conduct a preliminary assessment of various risks, studying the alleged objects of insurance (property, life or health of a potential insured).
- Refuse to draw up an insurance contract if it considers it inappropriate (providing false data after the statute of limitations).
- To charge for the services provided.
- Request documents proving that the insured event takes place; Investigate the circumstances that led to the occurrence of the insured event, if there is a suspicion of fraud.
- Terminate the contract without waiting for the client’s consent for this, if the client does not pay the fees on time (if payments are made in installments).
The insurer and the policyholder are always interconnected. More detailed information about them is presented below.
The insurer is obliged:
- Provide the policyholder with information about the types of insurance that interests him.
- Conclude a contract for the type of insurance that the client needs.
- Pay the insured amount, indemnify if an insurance event occurs.
- Keep insurance secret and personal data of the insured.
- To send an independent expert in order to assess the property in the situation of the occurrence of an insured event and draw up an insurance act in a timely manner.
Rights and obligations of the insured
The policyholder has the right:
- Receive full comprehensive information about the insurance company, licenses and services provided.
- Receive insurance payments if the conditions for providing all the necessary documents are met.
- Terminate the insurance contract early if necessary and return the unused insurance premium.
- Replace the insurer at will.
- To challenge in court the decision made by the insurance company to refuse compensation.
We found out that the insured and the insurer are participants in the insurance procedure who have their rights and obligations. We continue to study the material.
The policyholder is obliged:
- Provide reliable and complete information in the application and the subsequent contract (subject, insurance subject, as well as the degree of risk and the possibility of verification by the insurer of information).
- Pay the insurance premium in installments or at a time, as determined by the terms of the insurance contract.
- Notify the insurer about the occurrence of insurance events within the time period established by the contract. To notify the insurance company within the standard period of compensation for damage by the person whose fault in the occurrence of insurance events has been proven. The rights of the insurer and the insured, as well as their obligations, we have considered.
Insurance case
The situation provided for in the contract or law, the occurrence of which entails the payment of compensation specified in the insurance contract from the insurer.
Insurance Payments
The insurance payment is the amount of money that upon the occurrence of an insured event the client receives from the insurer under an agreement. The amount of payment is defined in the contract, in which the insurer, the insured and the insured are necessarily present.
Insurance contract
The insurance contract is issued by the insurer to the policyholder. It confirms the fact of insurance. The contract requires: information about all insurance participants (insurer, policyholder, insured person, beneficiary), insurance object, insured event, insurance amount, size and term of payment of insurance premiums, term of insurance, amount and procedure for payment of insurance amounts, and also legal details. The insurance contract is executed at the request of the citizen, where he indicates the conditions of insurance. By signing the contract, the client pays insurance premiums, after which the contract takes effect. The obligations of the insurer and the policyholder must be respected and executed.
Insurance policy
In fact, the insurance policy is the actual confirmation of the concluded insurance contract and is a monetary certificate issued to the insured.
The policy states:
- information about the participants of the insurance (insurer, policyholder, insured, beneficiary);
- data on the insurance object, insurance event, insurance amount, amount and terms of payment of cash contributions;
- insurance period;
- the amount and procedure for compensation payments.
The policy is issued only after payment of contributions. This is the insurer's fee for the service of the insurer. For example, we all have a health insurance policy, car owners have insurance policies.
Insurance classification
Classification in insurance is a generally accepted system of subdivision of insurance relations in our country in accordance with branches, sub-sectors, types and forms of insurance, fixed by legislative norms.
The first insurance industry is property insurance.The sub-industry is determined depending on the form of ownership of the insured. Types of insurance: insurance of buildings, property, vehicles. The object in this case is property.
The next industry is personal insurance. The sub-industry is referred to as social insurance for workers and employees; personal insurance of citizens. Types of insurance: medical insurance; accident insurance; mixed life insurance; in case of disability. The object of insurance in this industry is human life, health, and working ability.
The third industry is defined as liability insurance. Sub-industry: debt insurance; reimbursement insurance. Types of insurance: motor third party liability insurance; responsibility of professional activity; loan default insurance. Object of insurance: the policyholder's liability to third parties. In this industry, voluntary insurance and compulsory insurance are possible (for example, motor third party liability insurance and hull insurance).
What is the difference between compulsory and voluntary insurance?
Despite the obvious similarities between the two types of insurance, there are also enough differences. The contract of compulsory insurance cannot be terminated, since the insurer, in accordance with the law, makes insurance premiums without fail, but the contract of voluntary insurance can be terminated as soon as money ceases to come to the account of the insurer. The amount of insurance payments for an insured event in voluntary insurance depends on the amount of contributions under the insurance contract, while compulsory insurance takes into account not only the amount paid for insurance, but also other factors that affect the size of insurance payments almost more.
Compulsory insurance assumes that the scarce funds of the insurance fund will be covered by the state budget or by raising taxes. In the case of voluntary insurance, the insolvency of the insurance organization makes it impossible to pay the financial resources specified in the insurance contract. The legislation may provide for amendments to the insurance procedure for compulsory insurance, while for voluntary insurance, participants cannot go beyond the conditions specified in the contract.
Compulsory insurance as a whole throughout the country is designed to solve and regulate national risks, and voluntary should effectively preserve the personal property of citizens. Types of compulsory insurance:
- CTP;
- medical insurance;
- insurance of passengers on transport;
- liability insurance during the operation of hazardous production facilities;
- military insurance.
So, we examined who the insurer and policyholder are.