| Insurance is a form of risk-management which | | | | financing a car, the lender may also have |
| spreads risk of many people in exchange for small | | | | requirements. Most auto policies are for six |
| payments from each. Specifically, insurance | | | | months to a year. |
| transfers some type of risk (accident, theft, | | | | Home insurance |
| natural disaster, illness, etc) from one person or | | | | Home insurance provides compensation for |
| group to a more financially-sound entity in | | | | damage or destruction of a home from disasters. |
| exchange for a payment (also known as an | | | | In some geographical areas, the standard |
| insurance premium). Premiums are often annual or | | | | insurances exclude certain types of disasters, |
| monthly, but depending on the type of insurance | | | | such as flood and earthquakes, that require |
| they can be at other intervals. | | | | additional coverage. Maintenance-related problems |
| An insurance policy is a legally binding contract | | | | are the homeowners' responsibility. The policy |
| with an insurer to provide compensation for a | | | | may include inventory, or this can be bought as a |
| specified damage, loss, or injury suffered by your | | | | separate policy, especially for people who rent |
| business in return for a sum of money (premium) | | | | housing. In some countries, insurers offer a |
| paid. | | | | package which may include liability and legal |
| There are various types of insurance. These | | | | responsibility for injuries and property damage |
| include; auto insurance, health insurance, life | | | | caused by members of the household, including |
| insurance, home insurance, travel insurance, | | | | pets. |
| property insurance,and more. | | | | Liability insurance |
| Auto insurance | | | | This covers negligent acts of an insured party |
| Auto insurance protects you against financial loss | | | | with reference to a vehicle or a home. It protects |
| if you have an accident. It is a contract between | | | | the insured against legal claims and indemnification. |
| the insured and the insurance company. You | | | | There are various types of liability insurance such |
| agree to pay the premium and the insurance | | | | as professional indemnity insurance Environmental |
| company agrees to pay losses as defined in the | | | | liability insurance and Prize indemnity insurance. |
| policy. Auto insurance provides property, liability | | | | Professional indemnity insurance protects |
| and medical coverage: | | | | employees from malpractice suits (as in the |
| 1. Property coverage pays for damage to or | | | | medical profession), errors and omissions (by |
| theft of the car. | | | | appraisers, home inspectors, realtors, insurance |
| 2. Liability coverage pays for the legal | | | | agents, notaries, and others), and other acts of |
| responsibility to others for bodily injury or | | | | unintentional workplace negligence. |
| property damage. | | | | Travel insurance |
| 3. Medical coverage pays for the cost of | | | | Travel insurance covers financial losses caused by |
| treating injuries, rehabilitation and sometimes lost | | | | trips both locally and abroad. Depending on the |
| wages and funeral expenses. | | | | policy in question, it may cover lost luggage, theft |
| An auto insurance policy comprises six kinds of | | | | of personal possessions, medical costs and |
| coverage. Most countries require you to buy | | | | delayed flights. |
| some, but not all, of these coverages. If you're | | | | |