Types of insurance contracts that seek to indemnify an insured

Types of insurance contracts that seek to indemnify an insured

As per insured's view, the result is usually the same in all types of insurance contracts, i.e. the insurer pays the loss and claims expenses

Types of Insurance contracts

1. a "reimbursement" policy

If the Insured has a "reimbursement" policy, the insured can be required to pay for a loss and then be "reimbursed" by the insurance carrier for the loss and out of pocket costs including, with the permission of the insurer, claim expenses

2. a "pay on behalf" or "on behalf of" policy, and

Under a "pay on behalf" policy, the insurance carrier would defend and pay a claim on behalf of the insured who would not be out of pocket for anything. Most modern liability insurance is written on the basis of "pay on behalf" language which enables the insurance carrier to manage and control the claim

3. an "indemnification" policy.

Under an "indemnification" policy, the insurance carrier can generally either "reimburse" or "pay on behalf of", whichever is more beneficial to it and the insured in the claim handling process