Claim

A claim in the context of insurance is a formal request made by the policyholder to the insurance company for payment of a loss or event that is covered under the terms of an insurance policy. When a policyholder experiences a loss, such as damage to property, health issues, or legal liability, they notify their insurance company by filing a claim. The claim submission initiates a review process by the insurer, during which they assess the validity of the claim, evaluate the extent of the damage or loss, and determine the appropriate settlement amount based on the policy’s coverage limits and deductibles. If the claim is approved, the insurance company will issue payment to the insured or a third-party claimant, thereby fulfilling the insurer’s obligation under the policy’s contract. The purpose of a claim is to financially protect the policyholder from unforeseen losses, ensuring they can recover or receive compensation in accordance with the protections they have purchased.