Do you have property insurance? Are your assets safe and sound? Do you often think about insuring your assets to save your future? Nowadays, several companies provide full knowledge about Insurance and its policies. Several insurance policies can help you protect your future. The insurance companies allow you to provide life insurance, car insurance, property insurance, health insurance, motor insurance, and the list continues……..Moreover, Insuring the assets may help you cover the cost of losses. In today’s article, we will discuss Property and Casualty Insurance in detail.
However, before discussing Property and Casualty Insurance, we must be aware of some basic terms like What is Insurance? What are its benefits?
Let’s begin, Shall we?
Table of Contents
Insurance: An Introduction
Insurance is like Investing. How? Let me explain! Insurance is a type of investment in which you invest your money and protect your asset from Financial losses. Also, Ensuring your assets would help you cover all the costs. Thus, it protects you from all kinds of risks like financial and physical etc. However, the question is, who provides Insurance? Is it a person or place? Where should we go and apply for Insurance?
The insurance company is an entity that provides Insurance. The other names of Insurance companies are Underwriters, Insurers, Insurance carriers etc. Also, People or groups of people who take the insurance policy are Policyholders or Insureds. To take the benefit of Insurance, the Insured needs to pay some amount as a guarantee. Moreover, You may pay this amount every month or yearly, depending upon the policy you choose. After taking the policy, the insurance company or insurer is responsible for paying for the assets’ losses.
Also, If you wish to take the Insurance, you need to go through several formalities. First, you need to reach any insurance agent. An Insurance agent is a person who guides you step by step-by-step about the Insurance Policies. These agents are the employers of Insurance companies sent to you. Furthermore, The agents explain all the policies related to Insurance. You may select the appropriate policy you think is suitable for you. Afterwards, the insurance company sends a contract, a legally binding document, to the Insured.
This insurance contract is also termed “Insurance policy” If the insured agrees on all the terms and conditions and signs the contract, he/she gets injured or becomes a policyholder.
Moreover, when the insurer gets the policy, he/she asks to pay some amount. The insurer and the insured together decide the amount of the policy. This fixed amount that the insured needs to be paid is called a Premium Insurance policy. This premium Insurance policy helps the insurer to file a claim in case of loss of assets.
Furthermore, the process of filing a case is called Claims Adjuster. This process includes interviewing the Insured and witness before giving the Deductible.
Now, I bet you must be wondering about “What is Deductible?”
You all are well aware that the loss of a property or other valuable asset becomes a liability. Thanks to the Insurance policy! It helps the insured to cover this Out-of-Pocket expense. Also, this out-of-pocket expense which the insurance company pays is termed as “deductibles”.
So far, we have discussed all Insurance and its basics. I hope you now have an idea about Insurance. However, do you ever wonder, “ Why do we need insurance?” “What are the benefits of Insurance?” Let’s begin, shall we?
Types of Insurance and its benefits:-
In this section of the article, we will get to know about the insurance types and their benefits:-
- First, let us begin with Life Insurance. As the name suggests, Life insurance is Insurance that provides coverage against all life-threatening and unfortunate events. If you and your family apply for life insurance, the insurance policy protects you against any unfortunate event.
- The second benefit of Insurance is during the Bereavement in the family. If the deceased were insured, the insurance company would pay the entire amount for their loss. Also, the insurer will pay some bonus amount to the deceased family members. Therefore, Death insurance is one of the beneficial insurances.
- Another great benefit of Insurance is getting the full results. Once you apply for any Insurance, you start paying for it regularly. The returns of any Insurance are great. The insurer pays the total amount as per the contract and the bonus too. This happens during the completion of the contract or the sudden death of the insured(in the case of life insurance).
- Another significant benefit of Insurance is Future investment. Every parent worries about the future and tries to secure their children’s future. Insurance is a way of saving money. Moreover, Investing your time and money in an Insurance policy is worth it. It keeps your children and your future secure. Also, there are additional bonuses and benefits involved depending upon the type of policy you choose.
- Finally, Life insurance, Death insurance, property, car insurance, property and casualty insurance etc., acts as a future saving. It keeps you stress-free. Nowadays, when an unfortunate accident occurs, we are in desperate need of cash flow. No one holds that kind of cash in their pockets. Thus, in such desperate times, Insurance covers it all.
Know more about types of Insurance:-
Now, moving ahead with our discussion! Let us go deep and discuss more types of Insurance. As we advance, we will discuss Property and Casualty Insurance.
As the name suggests, Property insurance helps provide Insurance against the damage to the property. It gives Insurance against all types of risks to the property, including natural hazards. Natural threats like weather change, earthquakes, fire, flood, tsunamis, volcanic eruptions etc. Non-natural risks include Theft, accidents etc. There are multiple types of insurance policies that come under Property insurance. Let us discuss them one by one below:-
This type of insurance shields the insured from fire hazards. For example, if a policyholder insures his/her house or company using fire insurance, the insurer would compensate for all the damage in case of fire.
Moreover, the insurer would take the initiative to pay for this calamity and support the insured.
It is a type of natural calamity insurance that protects against flooding. If the insured experiences any property loss because of the flood, this Insurance will protect against it. Also, the insurer would make sure to cover the cost of damage and pay the insured.
It is one of the rare types of the insurance policy. It lies under the property damage section. However, scarce people like to opt for this policy. Also, people living in earthquake-prone areas take this policy. Earthquake insurance policy protects the policyholder against the loss of property due to an earthquake.
It is a unique type of Insurance. This type of insurance policy helps you with a shield against any mishappening to your house. Also, home insurance is the choice of every second individual nowadays. It is a type of property insurance that covers all the losses to your residence. If you chose to insure your house or place, the home insurance would cover it all. It protects your house cost against all the natural and non-natural calamities. Moreover, it not only provides the Insurance for the mere structure. It also pays for other valuable content in the house. Yes! You heard it right! It covers the costs of all the personal possessions of the owner.
It is a sporadic type of Insurance. Mostly, people with boiling companies and heating systems opt for this type of Insurance. Also, organisations that require a central heating system take this type of Insurance. Boiler insurance covers the loss of property due to the boiler. Moreover, It includes the repairing and replacement of boilers. You may also opt for this type of insurance in case you have a home boiling system.
Open VS Named Perils
Open and Named Perils are the two more terms used when we discuss Property insurance. Whenever we opt for a Property insurance policy, there are several clauses and sections mentioned. However, the reality is that we never really seriously read anything. We are all so occupied that we do not give time and read loads of clauses. Thus, whenever we opt for any insurance policy, we often call an insurance agent who briefs us about all the clauses. But do we listen? Therefore, we usually skip the part where they explain about Open and Named perils.
Now, back to our topic! What are Open and Named Perils?
Open Perils are the unspecified reasons for property loss. This means these are the reasons which are not mentioned in the policy. All the natural calamities like earthquakes, floods, cyclone, terrorism acts, nuclear accidents etc., fall in this category.
On the other hand, Natural Perils are the reasons for property loss mainly listed in the policy. These include all the possibilities of property loss like Theft, fire, explosion, lightning etc.
Casualty Insurance is a very different type of Insurance. It is not related to property insurance. Instead, it is more relative to an individual. Also, it is like liability coverage. This Insurance protects you in case any legal action takes place against you.
Moreover, it supports the individual in case of an accident caused and ends up hurting other people. Automobile or Car insurance is the most common type of Casualty Insurance. This Insurance comes into existence if you are found guilty of any car accident. Also, this Insurance covers all the damage caused during the accident(to you and the other person). In addition, it also pays for all the property loss caused due to the accident.
In the end, I hope you like our article regarding Property and Casualty Insurance and their benefits. Thank you for reading! Take care and be safe.