In insurance, generally the Cyber Liability Insurance is simply a contract between you and the insurance provider, that defines the claims that the insurance company is legally obligated to pay, in the event that you have been injured in some way. In return for an initial premium, often called the premium, the insurance provider promises to cover all possible losses caused directly by perils explicitly covered by the policy coverage language. In this article, we will examine the types of coverage that your insurance policy may provide you with.
The first portion of an insurance policy is the premium. This is typically the most expensive part of an insurance policy. If you go over the term of the policy limit, it’s possible that your premium could increase dramatically. You may also be required to choose a higher deductible or face a penalty if you go over the limit. Again, both of these are factors that insurance providers use to set your premium.
Another component of your insurance policy is the endorsements. These are essentially statements that declare that you have been insured, whether you know it or not. For example, if you have auto insurance policy endorsements stating that you have been involved in a collision, your vehicle is at fault, and that you are a nonsmoker, you are automatically considered a smoker. If your life insurance policy doesn’t include any endorsements at all, you are still insured, but your insurer has no legal obligation to you, and it’s up to you to either include your own endorsements or not.
The next portion of your insurance policy, and arguably the most important one, are the exclusions. Exclusions declare something that the insurance policy does not need to cover. For example, most auto insurance contracts do not require you to purchase collision or comprehensive coverage. It would be a waste of money to do so. However, your automobile insurance policy might also exclude windshield replacement after an accident or comprehensive coverage for items that can otherwise be covered under your insurance policy. Both of these are examples of what the exclusions in your insurance contracts define.
The policy limit is another component of your insurance policy. This is the maximum amount that you are asked to pay out of pocket for your premiums. Again, this is a factor used by insurers to determine how much of a risk you are to them, and it is usually set at a low figure. Most life insurance policies have a standard policy limit, and this number is usually raised each year to account for inflation.
Finally, there is the excess or deductible. This is the amount that your insurer will charge you as a deductible when you claim, and it is paid by you to the insurance company. If you don’t have enough coverage, and if you claim anyway, your insurer has no way of collecting the amount of the deductible from you. You will need to specify this amount in your contract when you purchase insurance, so make sure that you read all of the fine print.