Initially, as the concept of insurance policy came into existence, the insurance contracts were written on the basis of every single kind of risk, but the risks were defined in barrowed down fashion. Along with each single risk a separate premium was counted and calculated. But, with the emerging demands of the insurance policies, the contract forms were rectified.
The present insurance forms cover the all the risks, which are broadly defined in an inuring agreement on a general policy form, which are later narrowed down and the exclusion clauses are mentioned. If the insurance policy holder wants to get full coverage even for the exclusion clauses, the insured may need to pay an extra premium in some cases.
In several countries across the globe, insurance policies are often criticized for the increasing numbers of intricacies adhered to these policies. There are several layers of coverage clauses, exclusions, exceptions, and exception to exclusions. Understanding the differences between all these points is of primary importance. It is never a wise idea to stick to what the insurance agents are saying, rather before signing in the insurance contracts, it is ideal to do some homework. Insurance is one such investment that if done carefully, can help the insured in times of need.