Insurance as it is in the 21st century
When people are faced with the unexpected such as accidents and its like, the best security at hand to mitigate such situation is being insured.
Hence insurance can be defined as the simplest form of risk management in which the insured transfers the cost of unforeseen loss to another individual in exchange for monetary compensation known as the premium.
Insurance enables people, businesses and other bodies protect themselves against general forms of hardship associated with the likes of finances, health, life, etc. at a reasonably affordable price.
And such insurance coverage could be applied as below:
• Shielding family after one’s death from loss of income
• Debt repayment after death
• Covering conditional liabilities
• Shielding against the death of a key employee or person in your company
• Shielding your business from loss of income
• Shielding yourself against unforeseeable health issues
• Shielding your home against theft, fire, flood and other hazards
• Shielding yourself against lawsuits
• Shielding yourself in the event of disability
• Shielding your car against theft or losses incurred because of accidents
• Etc.
The basic way Insurance works
It works by pooling various risk factors with people interested in insuring themselves paying premiums into the insurance bucket of a company, simply in their account held by the insurance firm.
Simple Understanding of Insurance Contract
The insurance bond is a legal document that spells out the coverage and limitations of the insurance rule. It is critical that you read the contract agreement properly and ask questions on areas not clear.
You don’t want to pay for the insurance and then find out that what you thought was enclosed isn’t incorporated.
Risks
Life is full of risks.
Some are preventable or can at least be reduced, and while some are avoidable and some are completely unforeseeable.
There are two main types of insurance, namely life insurance and general insurance which covers different aspects in your life and breaking them further we apply this in the following below.
o Motor insurance
o Fire insurance
o Householders insurance
o Personal accident insurance
o Medical and health insurance
Life insurance is an insurance coverage that pays out a certain amount of money to the insured or their specified beneficiaries upon a certain event such as death of the individual who is insured.
This form of premium payments is done either monthly, quarterly or annually.
Life insurance basically covers:
o Premature death
o Income during retirement
o Illness
And also is mainly attributed to:
o Whole life
o Endowment
o Investment-linked
o Life annuity plan
o Medical and health
General insurance is basically an insurance policy that protects you against losses and damages other than those covered by life insurance.
But how do you know whether your hard-earned money is going on the policies you require the most? The answer is simply to do your research and ask questions that relate to your insurance needs.
