Insurance
From Economypedia.com
Insurance relates to a type of risk management that protects individuals, groups of individuals or organizations from financial liability arising out of a contingent loss. Payments, commonly referred to as premiums, are made by an insured party in exchange for security against an unexpected, financial loss occurring due to a specified cause. In case of occurrence of a specified event, insurer pays part or whole of expenses, and rest is borne by insured.
Insurance coverage provides protection against financial loss occurring due to specified events like death, fire, accident, and disablement. Some of common types of insurance offered by insurance companies include life insurance, health insurance, property insurance, liability insurance, travel insurance, and credit insurance. Insurers earn their income through process of underwriting and investment of policy premiums. [1] [2]
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[edit] Premiums
Premiums are charged by insurance companies in lieu of policies that a customer buys. Value of money charged by insurance companies are likely to vary from one service provider to another. Value of insurance premiums depend largely on general statistics related to specific events. [3]
[edit] Underwriting
Insurance companies use actuarial science to determine chargeable price for an insurance product. Risks associated with a particular event are quantified and premiums are charged to offset that risk. Underwriting profit is arrived at by subtracting amount of claims paid out, from sum of investment income and premiums collected. [4]
[edit] Investment of premiums
Premiums collected by insurance companies that are not paid out as claims, are invested by them in different investment avenues like government securities and stocks. Income earned by insurers are also dependent on these investments.
[edit] Life insurance
A life insurance policy provides coverage against terminal illness, critical illness, and death. To avail this policy, a person must pay regular premiums on a periodic basis. Different types of life insurance include temporary life insurance, whole life insurance, and universal life insurance.
[edit] Categories of Insurance (from EconomyWatch.com)
- Commercial Insurance
- Building & Contents Insurance
- Credit Insurance
- Dental Insurance
- Disability Insurance
- Fire Insurance
- Flood Insurance
- Health Insurance
- Home Insurance
- Indemnity Insurance
- Liability Insurance
- Life Insurance
- Medical Insurance
- Mortgage Insurance
- Motorcycle/ Motorbike Insurance
- Online Insurance
- Personal Insurance
- Pet Insurance
- Reinsurance
- Short Term Insurance
- Student Insurance
- Tenants Insurance
- Temporary Car Insurance
- Term Insurance
- Travel Insurance
- Vehicle Insurance
- Wedding Insurance
[edit] Insurance in the US
[edit] Insurance in the UK
[edit] Insurance in Canada
[edit] Travel Insurance
- Travel Insurance Policy - Financial Wellbeing, a reputed travel insurance and visitors insurance policy provider in Canada, is offering cheap family travel insurance, holiday insurance policy, term travel insurance, annual travel insurance, single and multi trip travel insurance and other cheap family travel insurance plans in Toronto, Mississauga, Ontario and other areas of Canada.
[edit] See also
[edit] References
[edit] External links
- Article in Profit.ndtv.com/
[edit] Further reading
- Article in Financialexpress.com
