What is Insurance? Is Insurance For You?


Insurance is the way of protection against financial loss. It’s a kind of risk management, mostly utilized to mitigate the potential risk of an unpredictable or contingent loss. Insurance companies have been providing insurance services for a long time. It’s usually provided by private individuals or companies on their own behalf, or by government organizations in collaboration with private citizens and institutions. Today insurance companies are engaged in a wide range of activities, providing diverse and specialized insurance services for many kinds of customers.

The insurance that an insurer provides can be a legal contract between the insurer and the insured. This kind of insurance is referred to as “business interruption insurance”. Insurance as a business risk management tool is a necessary and powerful tool for corporations and other organizations. It is an indispensable part of any company’s operational plan.

Businesses and their assets and liabilities to grow over time. As they do, so does the possibility of unexpected events that can cause huge financial losses. Some examples of unexpected events that can cause financial loss include floods, earthquakes, fires, accidents, explosions, and violence. None of these, however, should be a basis for the conclusion that the insurer has failed in its duty to maintain the safety and security of its insured clients.

Premiums are what insurance companies charge their clients in return for the guarantee of payment in case of financial loss. The premiums, or rates, that the insured pay depend largely on the details of the coverage. Each type of coverage, such as property, casualty, and liability coverage, has different premiums and coverage limits.

Whole Life Insurance

One kind of insurance is “Whole Life Insurance”. It offers high level of financial protection in exchange for a relatively low premium. This type of insurance offers a “Whole Life” element that extends to your dependents after you die. You pay a lower premium for lifetime coverage. The face amount of the policy also remains the same throughout your lifetime.

Legal Life Insurance.

Another type of Insurance is Legal Life Insurance. Its basic function is to pay the expenses and obligations of the insured, the named beneficiaries, in case the insured dies during the insured period of one year or more. When the term of the policy expires, the policyholder must sell the policy to an insurer at a price listed in the legal contract. In most countries, this is the most expensive type of insurance. Since it is not under the control of any particular company or institution, no claim is allowed for death benefits if the policyholder has surrendered his policy before the expiration date.

Insurance premiums also vary across various sectors. For instance, Insurance premium for property damage and injury claims are higher than those for vehicle damage or liability claims. Higher premiums are charged for the higher risk element of property damage. And so, Insurance premium for a home owner with a two-storey house will be higher than the premium for a tenant of the same house. It is not possible to get a straight comparison across all insurance companies, as different insurance premiums have different base rates.

Importance Of Insurance

Insurance plays an important role in the lives of many persons across the world. Many people depend on it for securing their future and well being, especially in times of natural calamities. Insurance coverage secures the future financially of the individual and his family members, if any one of them meets with an accident or meets with any kind of sudden health problem. Thus Insurance provides a sense of security to millions of persons across the globe.

In order to know about Insurance and its various aspects, it is good to go through some articles written by insurance experts and professionals. Life insurance is one such category of policies that require a lot of expertise on the part of the owner. There are many points to be considered while choosing a life insurance policy. Most of the common factors are the amount of premium to be paid, type of coverage that is opted for, the age and health of the insured person, coverage provided by the insurer, the period of time for which the policy is valid and the insurer’s reputation in the market.

The basic need of all the individuals is for financial security and this is achieved by choosing a suitable Insurance scheme that offers maximum safety. If you are looking for insurance coverage for your home, then you can opt for Property Insurance. Insurance on the other hand is required when you are involved in a liability case. A liability case is when you are liable to pay money as compensation to another party in a legal case.

Liability Insurance is designed to compensate the insurer for any financial loss in case the policyholder is found to be at fault and is found to have caused damage to another party. There are several types of liability cases such as bodily injury, property damage, medical injury and product defect. In case your property or equipment is damaged, you need to get Insurance to cover the cost of repair.