Insurance

Here’s How Insurance Works

There are three main steps in securing insurance:

1. Select a policy – Insurance policies are documents which list the things that you are or aren’t protected against. For instance, a travel insurance policy may state that it covers your medical expenses in case you get into an accident that causes injury abroad.
2. Pay the premium – The premium is the total amount that you have to pay every month or year (or sometimes just a single time) to secure the insurance. This amount will depend on the calculated risk for the value of the events being insured. For example, inexperienced drivers may get into an accident more, so car insurance for them will cost more – this can go higher the more expensive the car being insured is – since its repairs will most likely cost more.
3. Make a claim – If an event that you are protected against happens while being covered by the policy, it is possible for you to make a claim on your insurance. What you do is to tell the insurance company what happened and they will check if it’s covered under their stated policy. If the claim meets their standards, then you get to receive payment as agreed.

Things to Keep in Mind

·         When travelling abroad, it’s important to get travel insurance so you can get assistance in paying for medical bills and other costs in case you get sick or injured.

·         If you have children, what’s going to happen to them if you died unexpectedly? Having life insurance can help them get through such a dire ordeal by providing for them financially.

·         If you’re paying up a major mortgage, what happens in case you become too sick to continue working? With income protection insurance, you can get to cover your payments even if you cannot work for some time.

Consider these things and ask your preferred insurance company what their prices are. You can then make an educated decision on what type of insurance you need and which one you can afford.