Are you preparing for an interview with an insurance company? Well, interviewers often look for a skilled and competent candidate. To demonstrate you are a good fit, you need to demonstrate your mastery of the insurance field. If you are wondering how to do this, we’ve got you covered. The following insurance questions and answers will help you get ready to tackle the task ahead.
1. What Do You Understand By The Term “Insurance Cover”?
Insurance cover in an insurance policy that covers the insured against damages according to the signed insurance agreement. The insurance cover protects damage against the insured themselves or the insured’s property. The insured pays the insurance company a specific amount of money on an agreed-upon date, and then in return, the insurance company pays for damages that the insured or the insured’s property may face in the future.
2. Define General Insurance Policy And What It Covers.
General insurance policy protects the insured from generally all damages except death. Its cover ranges from damages against houses, machinery breaks down, car accidents, travel, cargo shipment transport vehicles, accident, health, liabilities like lawsuits, natural calamities like earthquakes and floods, burglary, and theft.
3. What Is The Difference Between An Insurer And An Insured?
The insurer is the insurance company, and they are the ones offering the insurance services. At the same time, the insured is the person or the organization receiving insurance service from an insurance company, for example. Kapi limited wants to put its employees under insurance cover. The company goes to an insurance company named “lager insurance,” then ” lager insurance ” becomes the insurer while Kapi limited becomes the insured.
4. Define Declaration Page In The Insurance Policy
The declaration page is a page on the insurance policy agreement that contains essential information details about the insured. Such information includes:
- Their name. It should be a legal name similar to their national identification card.
- The applicant’s residential address. The residential information should be updated often in case of any changes.
- Personal car details. When you want to insure your car, ownership confirmation details are also required.
- Type of insurance cover. This information gives the applicant an opportunity to identify which cover best suits you or your property. There are different insurance covers like health insurance, life insurance, long-term care insurance, homeowners and renters insurance, automobile insurance, and self-protection insurance.
- Loss payee details. This is where you state the details of the person who will receive damage repayment from the insurance company in case of any damages on the insured property. If the applicant still has loan payments on the property they intend to put under insurance protection, it is only necessary to fill.
5. Who Are Irrevocable And Revocable Beneficiaries, And How Do They Differ?
They are both beneficiaries of the insured amount in case of the insured’s death. However, a revocable beneficiary is a policy that allows the insured to change the name of their beneficiary even without the knowledge of the existing beneficiary. On the other hand, the irrevocable beneficiary policy does not allow the policyholder to change the beneficiary’s name without their consent. They have to be present and support the other new beneficiary details as well.
6. What Is A Constable Period Policy?
A section in the insurance agreement allows an insurance company to conduct its own investigation for a period of up to two years on damages before the company decides whether to pay for the damages or decline the request. The investigations are done by comparing the damage to the possible cause. Detailed information like ownership evidence, photos, videos, and expert opinions are mainly gathered during this period to ensure a correct decision is made.
7. Who Is A Loss Payee?
This is an organization primarily a bank or a person, in this case, a loan lender, who receives damage repayment for your damaged property from the insurance company. A loss payee is usually considered when buying a house, car, or property using loan money. They decide to put the property under an insurance cover to be on the safer side. When something terrible happens to this insured property beyond any possible repair, the company or the person that gave the loan money to buy that particular property will be in a position to receive the insurance payment. They will only receive the money if there is clear evidence that the insured has not cleared the required loan.
8. State The Meaning Of Endowment Policy.
An endowment policy is a risk cover where the insured pays the agreed-upon premium for a particular duration. In case of death, the money will be given to their beneficiary. When the insured outlives the estimated time, the money, inclusive of the accumulated bonus over the years, will be given back to the insured. It is, therefore, correct to say that is another method of saving that can give you back your money and a great interest if you only outlive your own estimated death time.
9. Explain The Two Types Of Life Insurance And Explain Their Importance.
Term life insurance and permanent life insurance are common types of life insurance. The term life insurance covers the insured life for a limited period of time. It could be a year or two. On the other hand, permanent life insurance covers the person who is insured throughout their entire life. The premium rates of the latter are higher compared to those of the term life insurance. The importance of term life insurance is that it can give the insured a lump sum of money if they outlive their estimated time of death. They are both essential when it comes to providing aid after the insured has been diagnosed with critical health conditions. The insured can use the insurance money to get the best treatment for their health condition. Both have accidental death benefits that can help the insured’s family members long after the insured is no longer with them.
10. Define The Term “Annuity”
An annuity refers to the investment agreement made between an individual and an insurance company. It involves making a series of payments over a certain period or even a lump-sum deposit. In return, the individual receives regular disbursements after retiring or a specified age or period. Annuities come in various types including fixed and variable types. The goal of an annuity is to offer the insured a steady flow of income later in life.
11. Define Group Life Insurance And Its Importance.
Group life insurance is a policy taken to cover a large group of people. More prominent companies often take advantage of insurance policies to protect their employees. Here is its importance:
- Companies that register with group insurance companies often give gratuity benefits to their employees after they decide to retire.
- Those related to a member of the group life insurance will benefit from the insurance funds as long as they are listed as the official insured beneficiary.
- Group life insurance can be used as a saving platform for the future of your loved ones when the insured is no longer with them.
12. What Do You Understand By The Term “Subrogation”?
Subrogation is when an insurance company seeks compensation for the money used to pay for their client’s damages from the person that caused the damage or injury. An example is when a client’s house is set on fire; the insurance company pays for the damages. Later on, after a thorough investigation, the company concludes the client’s neighbor caused the injuries. The insurance company will claim their refund from the third party, which in this case is the neighbor that set their client’s house on fire.
13. What Is A Personal Accident Cover, And When Is It Not Claimed?
They are insurance covers for your personal car against any car accidents. It also covers the insured and their immediate families like spouse, children, mother, and father.
However, there are occasions when such a cover cannot be claimed even if there is a terrible accident. Such scenarios include:
- When the insured causes an accident deliberately.
- When an accident occurred in the act of a crime.
- When the insured causes an accident to hurt themselves or commit suicide deliberately.
- When the insured injury is not as a result of the car accident, for example, stress fractures, shin splinters, runner’s knee, and so on.
14. Define Participating And Non-Participating Policy
The participating policy allows the insurance company to share its profit with the insured. The sharing is usually done in the form of dividends or reversionary. On the contrary, the non-participating policy does not allow the insurance company to share any of its profits with the insured.
15. Explain The Elimination Period
The elimination period is the duration the insured has to wait before receiving any payment for the damages they underwent. This is usually after putting in a request for the payment due to the loss or damage the insured has experienced. During this time, the insurance company has already gathered all the necessary evidence from researching the possible cause of the accident or the damage. It is also the time your insurance policy is visited to identify what was insured during the signing of the agreement and what was not. After the elimination period, then comes the payment process.
16. What Is The Meaning Of No Physical Examination In Insurance?
No physical examination policy gives the policyholder freedom to exempt mandatory physical tests. Physical examination is usually essential to some insurance companies. Physical examination information may require you to visit the hospital for several medical checkups that will need samples like blood, saliva, and urine. Some of these physical examinations may take up to a month, leaving you an insured the whole time. However, organizations with a no physical examination insurance policy have incredibly high premium rates.
17. What Is A No-Claim Bonus?
A no claim bonus is given to the insured clients that have not claimed their insurance in a particular year, and they get a reduction in their next year’s premium.
18. Define Surrender Value
Surrender value is when an insured loses all returns linked to their savings due to stopping their premium payments and withdrawing their money from the insurance company.
19. What Do You Understand By The Term Deductible?
A deductible is an amount the insured has to pay from their own money while claiming the insurance. Example. Let’s say your deductible is $ 100. Then you have insurance of $ 1000. From the $ 1000, you will have to pay the $ 100 from your pocket money, and the remaining $ 900 will be covered by your insurance company.
20. Define The Term Cash Value And Also Explain What Happens To It After Fully Paying For The Policy.
Cash value is the interest earned when you pay up your policy. Insurance companies use the cash value to pay for the insured’s premium until they die. The cash value can as well be withdrawn; however, the insured will either have to reduce their death benefit amount, or they will have to continue paying with their premium payments until it is all paid up again.
21. What Is The Meaning Of Double Indemnity?
This policy is found in some insurance companies where the companies have to pay double in case of any deaths caused by accidents. However, such an approach does not cover death by suicide or deaths caused by intentional negligence. Death by natural causes like diseases or conspiracy murder all falls under negligence.
22. Explain The Process Of Claiming Insurance.
The insured should help the process by providing valuable documents like receipts, invoices, proof of ownership, photos of the damaged property, and detailed information on how the damage happened. With all these, the steps will be more manageable.
- The first stage will be to invite someone from the insurance company to gather the detailed information provided by the owner, as mentioned earlier.
- The second step will be contacting an investigation on how the damage happened. The owner of the damaged property can help the process by providing witnesses for this particular stage.
- The third stage is going through the insurance policy to see exactly what was covered and what was not .it is at this stage the insured will be informed of any deductibles that will apply.
- The insurance company may hire experts to assess the damage to come up with the appropriate amount of money to be given to the insured.
- After figuring out the amount of money required, the payment arrangements begin. The payment duration will depend on how complex the damage is. The simpler the situation, the faster you get your insurance money.
23. How Do Insurance Companies Deal With Failed Premium Payments?
Different companies have their own way of dealing with failed payments; however, there is a particular grace period allowed to every insured member. Suppose the grace period has passed without any kind of payment, then the policy lapses. For things to go back to normal, the insured will have to pay for the outstanding premium and the interest accumulated from the date you stopped paying your premiums. Suppose the insured fails to pay premiums for policies like life insurance that you may require to pay for years. In that case, the insurance company will redact its premiums from the already accumulated funds until there are no more left funds. That is when the insured policy is completely terminated. However, this tactic is not used by all insurance companies.
24. State The Difference Between Single Limit Liability And Split Liability Coverage
Single limit liability coverage only covers a single person in a car accident where several people have been injured. In case of property damage, the single limit liability only covers the damages that occurred to a single property owner. At the same time, split liability coverage covers every person involved in a car accident or any person injured during damage on a particular property. In case of property damage, each person whose property was damaged will be covered as long as proper documentation like receipts and ownership is confirmed. Each person is covered separately.
25. Why Would You Like To Work For This Insurance Company?
I want to work for your insurance company for several reasons. I will mention a few. Your insurance company has an excellent reputation where employees get an opportunity to grow and showcase their talents. The company is among the top companies in the insurance industry. It also has favorable reviews on the internet from both the employees and the clients that the organization has worked with before and is still working with. I want to be part of such an organization. So that I can continuously grow along with the company as it is well known for its never-ending support towards the company’s employees.
Insurance companies often need employees that keep time are presentable, mature, and confident. Therefore, ensure to arrive on time, dress decently and speak with confidence when expressing yourself and answering interview questions. Also, ensure to research about the insurance organization, their values, and their employee expectations.