Insurance is a way of protection against financial loss in case of any eventuality. It is also a form of prudent risk management, mainly utilized to offset the risk of an uncertain or contingent monetary loss in favor of a more definite and certain amount of income. The insurance companies provide different kinds of insurance policies to suit different needs.
These policies cover risks such as property damage, liability, auto and health. The car insurance policies provide complete coverage against damages due to car accidents. There are insurance policies that provide coverage for medical payments for the passengers and drivers involved in an auto accident. Similarly, there are insurance policies that cover the cost incurred on rehabilitation of the wrecked vehicle. However, the most commonly purchased insurance policies are the auto and health insurance policies.
Home insurance provides coverage for a variety of risks. It can be either with respect to natural disasters such as fires, earthquakes and tornados, or man-made disasters such as floods, storms, hurricanes and fires. Home insurance policy limits may differ according to the contract. For example, a home insurance policy will not pay the full amount on account of inflation. Similarly, the amount of coverage will vary depending on the kind of home one has, on the location of the home, and on the personal belongings kept inside.
Auto insurance policies pay the damages to your vehicle if you meet with an accident. Depending on the nature of your auto policy limit, you can recover your medical expenses, damages to your vehicles, and pay a portion of your premiums. Home insurance policies pay the price to the insurer for treating and repairing your house if it is damaged because of a fire. Different kinds of insurances have different premium charges attached to them.
Life insurance policies pay a fixed amount to the insurer upon the death of the insured person. The insurer also makes payments to dependants in case of the insured person’s death. The premium of life insurance policy is based on a number of factors including the age of the insured person, his health history, his profession, the kind of policy and the policy limit. Different states have different laws on how much premium should be paid by an individual and how dependents will be benefited from the proceeds of the policy.
Property insurance protects the financial interests of the insured, as well as his family members. In the event of the insured’s death, his dependents will get money to meet their expenses. The insurance company, however, will not be liable to pay anything to the beneficiaries if the insured dies due to an illness that was pre-disputed or was due to an unreasonable death condition.
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