What is Insurance?

Insurance is a form of financial protection against risk. When a person or business buys insurance, he pays a relatively small amount of money to compensate the loss.

There are two parties to an insurance contract, the insurance company, and the policyholder. The person or business who benefits from the insurance is the policyholder. The business providing the protection is the insurance company. A typical insurance transaction involves the policyholder paying the insurance company a small amount in case of loss.

The concept of insurance works on the following principle. The insurance company generates its funds from many policyholders. The fee each policyholder pays is dependent on how frequent and grave the risk is. For every insurance contract, there are certain terms and conditions to be satisfied. It is always good to read terms and conditions thoroughly.

Insurance services cover an extensive range of products. We will discuss the ones with the highest subscription rates in passing. A more detail description for each of these services will be addressed in subsequent posts.

Medical Insurance

Medical insurance is critical due to the importance of health to a person. Health problems account for over 60%of all personal bankruptcies in the United States according to a Harvard review. Considering the above statement, you do not need any more encouragement to get medical insurance.

Vehicle Insurance

Yearly, millions of vehicle accidents occur in the US, and these accidents claim hundreds of lives. In 2009, over 33,000 people lost their lives due to vehicle accidents. Vehicle insurance is more important than a driver’s license in some states. Driving with an insurance puts both the vehicle and the driver at risk.

Life Insurance

Picking up a life insurance policy is beneficial not only to you but your family members. In case of death, life insurance helps to the family recover the expenses form the burial arrangements. Also, it is essential to always factor outstanding debts on mortgages and credit cards. Planning for your child’s college fees is not a bad idea.