Adjuster / Loss Adjuster An independent, qualified person who is appointed by the Insurance Company to identify the cause of the loss, the extent of repairs necessary to return the Insured Person to the state (s)he was in immediately prior to the loss, and the reasonable cost of those repairs.
Excess Excess is the initial dollar amount of any insurance claim which the policy does not cover – and hence which the Insured Person has to bear.
Exclusions These are items, events or conditions that are specifically excluded – or not covered by the Insurance Policy.
Extensions These are additional items, events or conditions the Insurance Policy has been extended to include (i.e. cover) – usually at an additional cost.
Indemnity This is the fundamental principle of insurance. Indemnity refers to the restoration of the Insured Person to the state (s)he was in immediately before the loss occurred.
Insurance Agent A person who represents the Insurance Company and sells Insurance Policies on its behalf. According to Malaysian law, any given insurance agent can only represent a maximum of two (2) Insurance Companies.
Insurance Broker A person appointed by a Client to give professional advice and assistance in the arranging, creation, sourcing and negotiation of Insurance Programs. Because the Insurance Broker represents the Client and is therefore independent of any Insurance Company, Insurance Brokers can and do work with any Insurance Company.
Insurance Policy This is an extensive document detailing the terms and conditions of the contract of insurance between the Client and the Insurance Company.
Insured Person This is the person who is covered by the Insurance Policy. It is important to note that the Insured Person may not necessarily be the same person as the Client / Policyholder. For example, a company – ABC Berhad buys medical insurance for its employees. In this scenario, the Insured Persons are the employees of ABC Berhad and the Client / Policyholder is ABC Berhad.
Peril A specific risk or cause of loss that is covered by an Insurance Policy. For example, a Fire Insurance Policy usually covers perils including fire, lightning strike, domestic gas explosion. It can also be extended to cover additional perils like flood, landslip and subsidence.
Policyholder This is the person who holds the ownership of the Insurance Policy. Although the Policyholder is often also the Insured Person (i.e. the person who is protected from specified losses by the Insurance Policy), this is not always the case.
For example, say a holding company, Big Time Berhad buys a Fire Insurance Policy for its wholly owned subsidiary, Small Co Sdn. Bhd. In this case, Big Time Berhad is the Policyholder – the owner of the Insurance Policy, and Small Co Sdn. Bhd. is the Insured Person – the one who is protected from loss caused by fire.
Premium The fee paid by the Policyholder to the Insurance Company in exchange for the Insurance Company bearing the specified covered risks.
Proposal Form This is the document that is used by the Insurance Company to assess the risk involved. This document is the basis of the legally binding contract of insurance between the Policyholder and the Insurance Company.