Limited Policy
What Does Limited Policy Mean?
Limited policy coverage is a basic type of insurance that provides benefits only for specific occurrences or events outlined in the contract.
For instance, limited life insurance policies may pay benefits only if the insured person dies from a specified cause, such as a sudden heart attack or auto accident.
These policies typically have lower premiums compared to more comprehensive insurance contracts and are commonly found in employer group coverages.
Insuranceopedia Explains Limited Policy
A limited policy can be part of health, life, or other types of insurance, offering coverage for very specific loss events. It is much more restrictive than a general insurance policy, which tends to be more inclusive.
Policies and coverage options can vary between insurance companies and may include blanket coverage for only a few specific losses. These types of policies are often found in group health and life contracts.
Comprehensive coverage can be costly, whereas policies that only pay for specific occurrences, as outlined in the contract, tend to be more cost-efficient to offer.
In health insurance, for example, a limited policy may have low coverage limits or restrict the ways you can access coverage. For instance, one policy may only pay if you are injured at work, while another may only cover injuries that are severe and require a lengthy recovery period.
