What is a claim in terms of insurance?

A claim in terms of insurance is defined as a formal request for payment after an accident, illness, or injury. When an insured individual experiences a loss that is covered by their policy, they must file a claim with their insurance company to receive the benefits outlined in their coverage. This process typically involves submitting necessary documentation, such as medical records or police reports, that validates the incident and the associated costs.

Understanding this definition is crucial because it highlights the role of claims in the insurance process: they are essential for the insured to obtain the financial support promised in their policy. Claims can be filed for a variety of situations, including health-related issues, property damage, or liability events, making them a fundamental aspect of how insurance works to mitigate the financial impact of unforeseen events.