Are you covered?
by: JOHN DOE
on: DECEMBER 2, 2022
in: BLOG
The life and property of humans are prone to risks such as death, disability, and destruction. Often, these risks may result in financial losses and Insurance is an efficient way to mitigate these risks.
Insurance is a financial product sold by registered insurance companies to safeguard customers and their properties against the risk of loss, damage, or theft.
How does insurance work?
When you buy an insurance policy, you agree to periodically pay the insurer a certain amount of money known as premium. In exchange, when you make a claim, the insurer pays you back or helps to cover the loss as covered under the insurance policy.
How premiums are calculated
The cost of an insurance policy depends on the risk, which in turn reflects how likely a customer is to make a claim. The lower the risk, the lower the premium will generally be.
It also depends on the value of what a customer is insuring, so things with a higher value will cost more to repair or replace.
Lastly, premiums are also made up of relevant local, state, and central government levies and stamp duties.
Types of Insurance
There are different types of insurance policies for different types of needs. But the most common types of insurance for people are:
Health insurance
In many cases, this is gotten through an employer even though retail plans exist. It can cover doctor visits, hospital expenses, therapy sessions, and drugs prescriptions.
Life insurance
If the holder of a life insurance policy dies, their beneficiaries receive a set amount of money to make up for what they would have earned. This is available on i-invest and you can find out more here.
Homeowners insurance
This insurance can cover the home and the things inside it against theft and some weather-related damages.
Car insurance
This typically covers personal injury or car repair after an accident. In some cases, it covers damage resulting from vandalization.
Benefits of Insurance
While many people are sceptical about buying insurance policies, it is important to know that in the long run insurance policies help to provide:
- Coverage of unprecedented expenses
- A way to meet your obligations
Some governments expect some level of auto-insurance before citizens can drive their vehicles.
- Financial security for the family
Important tips about insurance
Prior to purchasing an insurance policy, here are some points which might help in your decision
making.
