Wikipedia says insurance is:
In law and economics, insurance is a type of risk management that is used primarily to protect against the possibility of a loss. Insurance can be described as an equitable transfer of risk from one entity to another in return for a premium. It can be viewed as a guarantee against a significant, potentially devastating loss.
Insurance can be either personal or business, but the primary goal of insurance is to protect you and your business from possible losses. Term insurance can be defined as:
– A small loss can prevent a major, potentially devastating loss.
In the event of an accident, insurance protects you from financial loss. Insurance is a contract between the policyholder (person/entity purchasing the insurance) and the insurance company. premium is the payment made by policyholders.
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There are many types of insurance. But let’s just stick to the most important.
Auto Insurance
Also known as auto insurance
Vehicle insurance
Car insurance
Motor insurance
You can purchase it for cars, trucks and motorcycles, as well as other vehicles. Auto insurance’s primary purpose is to protect against damages resulting from traffic accidents.
In 2006, the USA had more than 180 million cars. Auto insurance companies covered approximately 175 million. It is the largest market for auto insurance in the world. Russia has more than 35 millions automobiles. Approximately 34 million are also insured. China – Ten million automobiles are insured.
Auto insurance provides:
a) Property coverage: It pays for theft or damage to your car
b) Insurance coverage for medical expenses – It covers your liability to others for bodily injury and property damage
c) Liability coverage: It covers the costs of treating injuries, lost earnings, and funeral costs.
The insurance premiums for adults, teens and males differ. Statistics show that males drive more than females, and therefore have higher accidents at all ages. Teenagers with no driving record will also have higher car insurance premiums.
Motorcycle owners would pay more for insurance than owners of compact, mid-sized, and electric cars.
Auto insurance policies are contracts. Most polices can be issued for six to one year. Your auto insurance company in the USA, Russia or Brazil should contact you by phone, mail, or any other means to renew your policy.
Home Insurance
Home insurance is similar to auto insurance. It provides protection against home damage caused by natural disasters. It’s sometimes called homeowners insurance, hazard insurance, or homeowners insurance. It is also known as HOI in the real estate industry.
This type of insurance covers private residences. This type of insurance can cover:
Losses to one’s house-loss of home use
Home contents
Other personal belongings may be lost by the homeowner
It is possible to purchase additional insurance for specific types of disasters in certain areas.
Flood insurance
Earthquakes
– War
These are excluded from the original policy plan and may require additional coverage. The contract for home insurance is quite long. It outlines what will and will not be covered in the event of different events. It can be either seasonal or long-term.
Your home insurance company should contact you via mail, phone, or other means to renew your policy.
Health Insurance
The type of insurance that covers medical expenses is called health insurance. Also known as:
- Health coverage
- health care coverage
- health benefits
Individuals or companies can purchase policies on a group basis to provide coverage for their employees. A long contract is required for health insurance policies. To protect themselves against unexpected healthcare expenses, policyholders must pay premiums. An insurance contract can be renewed monthly or annually.
Around 84% of Americans have health insurance in 2008.
- About 9% buy health insurance directly
- About 60% of those who obtain it through their employer are eligible
- Around 20% of Americans have health insurance through various government agencies.
In 2006, 16% (47 million) Americans were uninsured. The average spending is greater in the individual market. Most medical expense plans cover dental expenses. You can also get stand-alone dental coverage.
The majority of the USA’s health care system is private. Payments from patients and insurance are the main source of funding for hospitals and doctors.
Although hospitals provide outpatient care in their emergency departments and specialty clinics, they are primarily there to provide inpatient care.
The Commonwealth Fund reported that the USA was ranked last among 19 countries in terms of quality health care quality in 2008. The Institute of Medicine of National Academy of Sciences states that the United States is “the only wealthy, industrialized country that doesn’t ensure that all citizens have health coverage.”
Life Insurance
Also known as life insurance, it is also called life assurance. The policyholder’s death, sickness, critical illness, terminal illness, or other event will be covered by the insurer (or Life Insurance Company). The policyholder may pay a fee in lump sums or at regular intervals. This is known as a premium.
You can get life insurance:
- Temporary.
This is life insurance coverage that covers a specific term for a set fee (premium). The premium usually covers only the death event.
- Permanent
This type of insurance is in effect until the policy matures, or pays out.
Life insurance, like most insurance policies is a contract between an insurer and a policyholder. It pays a benefit to designated beneficiaries in the event of an insured event that is covered under the policy.
Some events may be covered by insurance
- Protection policies
- Investment policies
- Illness
The insured events may be limited in each contract. They are usually written to limit the policyholder’s liability, such as claims for suicide, war, or fraud. The contract will be null if the insured makes false statements on the application.
Before the insurance company will pay a claim, it must have acceptable proof of the insured’s death. Here is an example of the documents required in case of death.
- Certificate of death
- Completed, signed, and notarized claim form
Insurance companies can investigate suspicious deaths before making a decision about whether they are obligated to pay. The proceeds of the policy can be paid in a lump sum, or an annuity.
