What is Insurance and Why Do We Need It?

1 Introduction

Before I introduce this month, ensuring the topic, I also have a bit of irony that occurred late last month. After writing an article on what to do in a winter car accident, I found myself slipping on the ice, which leads to a slow-motion toward the other car at the intersection. I was driving in the right speed for the conditions. Sometimes, however, the events are beyond your control. As I slid slowly toward the other car that day, I was glad of two things, I was sliding slowly, and I and another driver is protected from financial loss, which was literally coming our way. We've all been there, writing a monthly check for auto or home insurance, thinking to yourself, why do I have to pay money to a company to promise to pay when I need it. That day, I was glad I had, but rest assured that many days I do not feel the same emotions. My goal in this month's article is to provide you with the basic differences between the major varieties of insurance and some of the reasons for its existence.

...

liability insurance

Everyone talks about our "litigious society". We all know people who are sue-happy. It could be argued that the responsibility for protection for others. Liability insurance protection provides you with the insurance company telling you that you will pay the amount you become legally obligated to pay. Sometimes this can mean a case in court, but more often the problem is "solved" for you by the insurance company. Imagine that your houseguest trips and falls on ice on the sidewalk, and you are guilty of not putting sand or salt. Your insurance company is responsible for paying her medical bills, lost wages, and perhaps pain and suffering due to accidents.

Property insurance:

This type of insurance against liability protection more palpable. Property insurance protects the physical fact of damage or loss of use. Most policies will include and exclude certain kinds of events, titled "Danger". For example, war is not turned off on almost every policy, which is why the 9 / 11, when President Bush declared war, he simultaneously lost coverage for all of lower Manhattan. Fire on the other hand is on almost any insurance for fire insurance, where the historic property insurance has its roots.

Professional Insurance:

can think of this type of insurance, liability insurance for certain professions. Doctors, lawyers and engineers have to have this type of insurance in case you make bad decisions or give advice to the poor. This type of insurance is expensive, especially in areas such as the medical field in which experts make the court call several times a day.

3 Why do we need insurance?

Many of us have never had to claim on our insurance. Therefore, when we will continue to write checks every month, we feel like we're pouring money right down the drain. Even though you've never had to make a claim on your insurance, there is good reason that its there. Of course insurance is there to protect yourself and your investment, but let's face it;. Many of us would not bother with insurance if it is not required by law or bank

, not only for insurance protects you and those around you, it is the unsung hero of American economic success. Think about it for another, who has a stake in protecting your property and you rent a car or mortgage your house, then the bank fails. They want to make sure that their investment is protected. Banks would not want to borrow money, unless they knew it was a very good chance you'll get your money back. Accordingly, the insurance provides protection for the consumer lending process, which is the backbone of the U.S. economy. You may say that insurance companies grease the wheel.