What Is Insurance Policy Life Cycle?
The life cycle of an insurance policy can be broken down into a number of stages. The first stage is the application stage, where the customer applies for coverage and provides all necessary information. The second stage is the underwriting stage, where the insurer reviews the application and decides whether to offer coverage. In this stage, insurers may also request additional information from customers in order to make a decision. If coverage is offered, then the third stage is called the policy issuance or sale. This is when an insurance policy becomes legally binding and premiums are due for that period of time. The fourth step in this life cycle is called renewal or continuation, which occurs at regular intervals throughout a term of a policy. In this step, customers have to decide whether they want to continue with their current plan or switch...Read More