Understanding Insurance Lingo

Insurance is something that can be difficult to deal with, but it is necessary for most people to have. Understanding your insurance policy is essential, no matter what kind of insurance it is. There are a few basic insurance terms that you should be familiar with, whether it is car insurance or homeowners insurance in Peoria AZ. Consider these three things that every insurance policy has.

Premiums

A premium is the amount that you pay for your insurance policy. You may pay this amount yearly, quarterly or even monthly. If you miss paying your premium, you are no longer covered by the policy. So, it is very important that you are able to keep up with this. It is better to have less coverage and be able to pay your premium than to have more coverage and miss your payments.

Deductibles

A deductible is the amount of money that you have to pay before the insurance company covers your claim. If you choose a higher deductible, you will pay less on your premiums. If you choose a lower deductible, though, be prepared to pay a higher premium. There are pros and cons to both; discuss with your insurance agent which option is best for you.

Benefit Period

Every insurance policy has a defined benefit period. Sometimes, the policy automatically renews. It is important to know when your benefit period ends. If you do not know this information, your coverage may end without you being aware. Because it is important to be covered at all times, you need to keep track of your policy coverage dates.

If you have questions about any of your insurance policies, you can set up a consultation with your insurance agent. He or she can help you understand your specific policies and how you can make the most of your coverage.