Policyholder protection

Policyholder protection refers to safeguards in place for individuals who purchase insurance policies. These protections ensure that policyholders receive the benefits they are entitled to, even if the insurance company faces financial difficulties or goes bankrupt. Regulatory bodies often oversee these protections, which can include compensation schemes to reimburse policyholders or guarantee funds to fulfill claims. This system aims to instill confidence in the insurance market, assuring consumers that their investments in insurance will be secure and that they can rely on their policies when needed.