“Insurance and death or claims on loss” touches on the core of how insurance works in life, health, and general risk coverage.

 “Insurance and death or claims on loss” touches on the core of how insurance works in life, health, and general risk coverage.

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🔹 1. Insurance and Death

Life Insurance is specifically designed to provide financial protection to the family (nominee/beneficiary) when the insured person dies.

The insurance company pays the “sum assured” (agreed amount) to the nominee upon the insured’s death, provided the policy is valid and premiums were paid.

Some policies also cover accidental death benefits or offer double coverage for accidental deaths.

👉 Example: If someone has a ₹50 lakh life insurance policy, and they pass away during the policy term, their nominee (spouse, child, or parent) will receive ₹50 lakh.

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🔹 2. Claims on Loss

Insurance isn’t only about life—it extends to general insurance like health, motor, fire, crop, or property.

In these cases, claims are made when there is a loss, damage, or injury covered by the policy.

Types of claims:

1. Health Insurance → Claim for hospitalization, surgeries, or treatments.

2. Motor Insurance → Claim for repair/replacement if a car is damaged in an accident.

3. Home/Property Insurance → Claim if there’s a fire, theft, earthquake, or flood damage.

4. Business/Commercial Insurance → Claim for losses due to accidents, supply chain disruption, or disasters.

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🔹 3. Key Concepts in Claims

Insurable Interest → You must have a genuine financial loss if the insured thing/person is lost.

Utmost Good Faith → Both insurer and insured must disclose all facts honestly.

Indemnity → Insurance compensates only up to the actual loss (except life insurance, which pays the sum assured).

Nomination → For life insurance, you must nominate someone to receive the claim.

Claim Settlement Process → Intimation → Submission of documents → Verification → Approval → Payout.

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✅ In short:

Life insurance = payout on death to protect dependents.

General insurance = payout on loss/damage to restore the insured party financially.