Insurance is the coverage offered by an insurance company to an individual or organization against a specified loss in exchange for previous premiums received from the policyholder. A premium is a periodic sum of money charged by the insurance company to provide active coverage.
The premium is generally collected on a monthly or semi-annual basis. The insurance company normally terminates the policy if the policyholder fails to make the scheduled payment. To renew this lapsed policy, the policyholder will either have to pay the balance of the insurance premium or be reinstated.
The main advantage of an insurance contract is the feeling of financial security it offers to the insured.
The different types of insurance policies broadly include; Health insurance, life insurance, car insurance, home insurance and device protection.
The premium for the same service can vary depending on the service provider and a host of other factors. The amount of the bonus is mainly based on statistics. Individual habits and history can also play a role in influencing the insurance company's decision on premium cost. For example, a young driver with a sports car might have to pay a higher insurance premium than a middle-aged driver driving a regular sedan, due to the higher likelihood of risk.
Due to the variability in rates and the variability in the formulas that individual companies use to determine rates, it is essential to obtain multiple insurance quotes before purchasing an insurance policy. Each insurance policy will have its own advantages and disadvantages. However, the lowest premium price does not have to be the best insurance policy, as it may only offer a lower level of cover. It will therefore be necessary to understand the various clauses and complexities of the policy. It will also be necessary to check the reputation of the insurance company, taking into account factors such as the percentage of claims rejected and timely reimbursement.
An insurance agent or broker would be aware of the different insurance plans offered by various companies. The agent will also be of great help in calculating the insurance premium estimate based on the basic information obtained and will help you determine the best insurance policy for you, the first insurance buyer.
