Insurance is a means of protection against financial losses in a wide variety of situations. This is a contract where one party agrees to pay a financial loss because of an event the other party. Insurance works on the principle of shared loss. If you want to be insured against any losses, agree to regular payments, called premiums to the insurance company to perform. Instead, the company awarded the contract, the insurance policy.
The company promises to pay money damages to the properties mentioned in the policy. History Insurance is thousands of years. Code of Hammurabi, a set of laws Babylon 1700BC, is regarded as the first form of credit insurance. A borrower does not repay the loan for personal injury made it impossible to do so. Insurance as we know it today can be attributed to the Great Fire of London in 1666, where he devoured 13,200 houses. After a disaster, Nicholas Barbon opened an office to ensure the building. Types of insurance are generally covers the situation with pure risk – that is, situations in which losses can occur. The situation is fire, floods and accidents. People also bought an unusual form of insurance to cover financial losses as a dancer will hold the feet from injury.
There are three types of insurance sold:
1. Life insurance Life insurance policies provide that the insurer will pay a certain amount if you die. This can be paid in a lump sum or installments to the recipient. Some types of life insurance also allow the insured to save money.
The policy has a cash value. The insured can borrow against the cash value or cash surrender value of policies. Annuity these is savings plans sold by insurance companies to offer fixed and regular pensions. If annuitant dies before receiving the guaranteed payment, the insurer must continue making payments to beneficiaries.
Dividend some of the reimbursement of insurance are premiums in the form of dividends. Such policies are called participating policies. An insurance company paying the dividends if the money collected in premiums exceeds the amount needed for benefits and administrative costs. Dividends may also be part of corporate profits earned on investments made with premium features. Dividends are usually paid on life insurance.
2. Private health insurance Health insurance pays all or part of the cost of hospitalization, surgery, lab tests, medicines, and other medical treatments. The rising cost of medical care, the need for adequate health insurance. You could experience serious financial problems without coverage, particularly in cases of serious illness or accident. Dental insurance health insurance is one of the fastest growing. Help pay for a variety of dental services.
3. Property and Liability Individuals and businesses buy insurance for property collection and their equipment to protect against financial loss. Property insurance provides direct compensation, the insured if the goods are damaged, destroyed, or lost due to the danger. Liability insurance protects individuals and businesses from potential financial losses if their actions cause injury to others or damage to property of others. The main types of individual coverage are:
* Homeowners insurance this provides protection against loss of damage to homeowners and their content.
* Car Insurance and this is the most important form of insurance purchased. Drivers are legally responsible for the costs arising from accidents they cause.
This insurance protects the insured against financial loss caused by the accident. Financial viability of insurance companies’ financial stability and strength of the insurance company should be an important consideration when buying an insurance contract. Insurance premium paid currently provides coverage for damage that may occur many years in the future.
Therefore, the viability of insurance is very important. In recent years, some insurance companies go bankrupt; to their policyholders with no coverage.
How insurance is sold most insurance companies sell policies through agents. Exclusive agent is an employee of an insurance company that sells only that company’s policies. Independent agents sell policies for several companies.