Sum insured
Market basicsThe maximum a health or general insurance policy will pay in a policy year.
In plain terms
The headline number on the policy — and rarely what a claim actually settles at, once room limits and sub-limits are applied.
1492 terms
Glossary
Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.
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Average clause
Market basicsA policy condition that reduces a partial claim in the same proportion that the sum insured falls short of the value the policy required.
In plain terms
Under-insurance does not merely cap the claim at the sum insured — it scales down every claim below it. Insure half the rebuilding cost and a partial loss settles at roughly half.
Cumulative bonus
Market basicsAlso called: No-claim bonus
An increase in the sum insured granted for each claim-free year, at no additional premium.
In plain terms
A ₹10 lakh policy can grow well beyond that over time. On a port, this accrued layer is generally treated as part of the cover you carry across.
Room rent limit
Market basicsA cap on the daily hospital room charge a policy will pay, often 1–2% of the sum insured.
In plain terms
The clause that quietly halves large claims: exceed it and many insurers scale down the surgeon, ICU and medicine charges by the same ratio.