Whenever you choose to have a contract with an insurance company, you should be able to understand fully the policy that you agree to. Otherwise, you might end up offended when the company fails to compensate you. Well, it is not something that one should ever call for. If anything, you are getting that contract so that you get paid. Compensation is the actual goal. However, there are some instances when the insurance company might fail to make compensation. You would be wasting your time following for the compensation. Here are some of the common cases:
1. When the loss is not out of the risk insured
Whether you are insuring your car, property, or life, you have to do it against specific risks. For instance, you could insure then against accidents, fire, natural death, respectively. This means that if a risk other than the insured causes the risk, compensation may not be made. For instance, if you insure the car against accident, then it gets burned out to ashes, you might not receive your compensation.
2. When you are not up to date with premium payment
If you choose to be paying your premiums per month, which in normal cases is the agreement, you should ensure that you are up to date with the payment. Different firms have different number of months when you are allowed to default your payment. If your company allows for three months default, if you happen to get the loss on the fourth month of default payment, you might not be compensated. It is assumed that you had terminated your contract with the company.
3. When you are the source of the loss
If you cause the loss to be compensated, you should be sure that if it is realized there will be no compensation for you. For instance, if you insure your car against fire, then you decide to burn it, you will not be compensated. This is why investigations are typically done to ascertain the cause of the loss.