INSURANCE LETTERS Insurance letters tend to be formal, but private companies' need for customer relationships leads to less formality. Technical financial matters must be simplified for non-finance readers. Effective insurance letters require good product knowledge, understanding competition, and command of writing principles. Fire Insurance In fire insurance, the insurer agrees to cover fire losses to the insured's property up to a fixed amount during a policy period, in return for a premium. Proposers give property details in a Proposal Form. If accepted, a Cover Note grants temporary protection till policy issuance. Premium rates consider physical hazards like building construction, lighting/heating systems, occupied trade's fire risks, and location's congestion and water availability. Insurers inspect premises and assess moral hazard from the proposer's character and efficiency. An insurer's letter quotes rates after inspection. Clients must inform changes in property use affecting risk. The insurer then revises the premium. Claims after fire damage are supported by required documents and surveyed by the insurer's representative. The insurer verifies the claim and settles it as per policy terms. Settlement considers depreciation and underinsurance. Claims may be accepted, reduced or refused. Marine Insurance A merchant seeking marine cover writes to a broker with risk details. The insurance company determines risk acceptability and issues the policy. It needs details on client, conveyance, voyage, goods and packing, required coverage, and insurance value. Premiums are quoted after considering client reputation, voyage route/length, conveyance, goods' damage risks and packing, and extraneous risks covered. An open policy allows declaring multiple shipments under its large coverage amount. The company informs when the open policy amount is fully declared. For cargo claims, the insurer verifies the cause and appoints a surveyor if required. Claims may be accepted, reduced or refused based on policy terms, documents furnished, and the insurer's own investigations. Life Insurance Life insurance provides investment, savings and family security. Premiums are based on age, sum insured, policy term and type. Proof of age determines applicability of age-related terms. Lapsed policies can be revived by paying revival fee and due premiums. Hardship options include policy loan up to 90% of surrender value or converting to reduced paid-up policy. Surrender needs original policy, age proof, bonus certificates and assignee consent. Loans require the same plus loan fee. The insurer makes efforts to dissuade surrender and default. For survival claims, the insurer asks for needed documents. For death claims, the nominee initiates the claim process. Scrutinized, justified claims are paid out.