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Your Insurance Glossary: The Top 5 Terms Every Policyholder Should Know
Sometimes, insurance policies can feel like they’re written in a different language. With industry jargon and fine print, it’s not uncommon to wonder what your coverage really includes. By learning these few basic concepts you can better understand your policy, feel more confident about your coverage and know what to expect if you ever need to file a claim.
Below are Rockingham Insurance’s top five insurance terms that everyone should know:
1. Deductible: What You Pay First
Your deductible is the amount you pay out of pocket before your insurance begins to cover a loss. For instance, if you have a $1,000 deductible and incur $5,000 in covered damage, you would pay the first $1,000 and your insurance would cover the remaining amount (up to your policy limits).
2. Premium: The Cost of Coverage
Your premium is the amount you pay for your insurance policy. Premiums may be paid monthly, quarterly or annually depending on your policy. The cost of your premium varies based on factors such as your coverage level, deductible, location and claims history.
3. Claim: Reporting a Loss
A claim is a request you submit to your insurance after a covered loss or damage occurs. Once filed, Rockingham Insurance reviews the situation and determines what is covered under your policy.
4. Coverage Limit: Maximum Payment
Your coverage limit is the maximum amount your insurance policy will pay for a covered claim. Different parts of a policy may have different limits, such as coverage for property damage, personal belongings, or liability protection
5. Liability Coverage: Protection if You're Responsible
Liability coverage helps protect you financially if you are responsible for injury to someone else or damage to their property. It may help cover medical expenses, repairs or legal costs, depending on the situation.
Understanding Your Policy
Taking time to understand basic insurance terms can help you make informed decisions about your coverage. If you ever have questions about your policy or coverage options, your trusted Rockingham insurance agent can help explain your options and ensure you have the protection you need.
Sometimes, insurance policies can feel like they’re written in a different language. With industry jargon and fine print, it’s not uncommon to wonder what your coverage really includes. By learning these few basic concepts you can better understand your policy, feel more confident about your coverage and know what to expect if you ever need to file a claim.
Below are Rockingham Insurance’s top five insurance terms that everyone should know:
1. Deductible: What You Pay First
Your deductible is the amount you pay out of pocket before your insurance begins to cover a loss. For instance, if you have a $1,000 deductible and incur $5,000 in covered damage, you would pay the first $1,000 and your insurance would cover the remaining amount (up to your policy limits).
2. Premium: The Cost of Coverage
Your premium is the amount you pay for your insurance policy. Premiums may be paid monthly, quarterly or annually depending on your policy. The cost of your premium varies based on factors such as your coverage level, deductible, location and claims history.
3. Claim: Reporting a Loss
A claim is a request you submit to your insurance after a covered loss or damage occurs. Once filed, Rockingham Insurance reviews the situation and determines what is covered under your policy.
4. Coverage Limit: Maximum Payment
Your coverage limit is the maximum amount your insurance policy will pay for a covered claim. Different parts of a policy may have different limits, such as coverage for property damage, personal belongings, or liability protection
5. Liability Coverage: Protection if You're Responsible
Liability coverage helps protect you financially if you are responsible for injury to someone else or damage to their property. It may help cover medical expenses, repairs or legal costs, depending on the situation.
Understanding Your Policy
Taking time to understand basic insurance terms can help you make informed decisions about your coverage. If you ever have questions about your policy or coverage options, your trusted Rockingham insurance agent can help explain your options and ensure you have the protection you need.
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