Are you thinking of getting insurance for your loved ones? Are you planning to get your business insured? You may be confused about where, to begin with. Let’s begin with the basics. Insurance is a contract between two parties or two individuals, where one pays money in installments and the other promises a return in favor under the circumstances a claim is made. Depending on the risks involved and of course your choice, you can choose from a number of types of insurances.
Some Related Terms:
- Policy: It is the contract that states the terms of insurance.
- Benefit: The favor returned by the second party in the event of loss or as when the policy states.
- Premium: The amount paid by the first party to get insured. It is generally to be paid in installments.
- Coverage: The risks or losses covered under the policy, against which the benefit is offered.
- Insured: The person or party who pays a premium to receive a benefit in the event of a loss. Insured is not to be misunderstood with the beneficiary.
What Are The Types?
Depending upon who is offering, there are two types categories for insurances;
- The ones offered by the Government. These are generally offered to the weaker sections or underprivileged ones. There is no premium or in general, a negligible amount of premium to be paid by the insured. Some of the government operated insurance policies include; Social Security Insurance, Worker’s Compensation, and Unemployment Allowance/Insurance.
- The ones offered by private insurance agencies. These policies range from all domains of life encompassing, life, health, and business, and even more. The premium and the benefit depends on the coverage of the policy. The more the risk is involved, the more would be the premium.Some examples are; Life Insurance, Automobile Insurance, Health Insurance, and the list goes on.
How To Make A Claim?
In the event of loss, the beneficiary is entitled to make the claim. The benefits will be offered as per the policy and coverage of the policy. There have been cases where insurance agencies have not fulfilled the coverage. You can hire an insurance lawyer in such an event. The cost for hiring an attorney will be borne by the insurance company. Your defense attorney will make your case and present it before the jury, to let the courts decide who’s to pay and what is to be paid. You can ask all sorts of questions to your attorney, just to make sure that he’s defending you and not working for the insurance company.
Depending on the type of insurance and the risks covered, you can choose from a number of insurance policies available. In the case of Life Insurance, the beneficiary and the insured are different. The insured would be the person whose life is covered and beneficiary will be the person who receives the benefit. Likewise, there are a number of terms and conditions stated by the insurance companies. Make sure you read the offer document carefully before buying any insurance policy.