What is the full form of PYP in Insurance?
The PYP full form in insurance is the Previous Year’s Policy. It refers to the documents of the insurance policy that the policyholder has issues from the last insurer. This term is used quiet often in the insurance industry, while discussing the renewals, while comparing policy coverage, and while evaluating the changes in the policy terms and conditions from one year to another.
Importance of PYP in insurance:
It plays a significant role in policy renewal. PYP ensures that there is no lapse in insurance converges, and it allows all the policyholders to renew their coverage needs and make required adjustments. Also, policyholders who have not made any claims during the previous year may be eligible for A claim bonus, which results in discounts on premium payments.
Risk evaluation and policy adjustments using PYP:
The insurance companies may make use of the previous year’s policy to assess the risk appetite of the policyholder. Also, on the basis of the claims history, the insurers might adjust the terms, coverage, and premiums of the renewal policy. Information given in the previous year’s policy helps the insurance companies to process the current claims efficiently and also helps to identify fraudulent activities.