Things like car accidents, property damage, illness and death can happen to anybody, and if you don’t have insurance, you could end up with real money worries. It is essential for individuals as well as businesses to be having insurance coverage against unforeseen incidents such as fire, natural disasters, theft or health. Accidents occur all the time and we need to be covered in case a disaster strike. We work hard for our money and when we purchase expensive assets we must be sure that we will be reimbursed should loss incur due to an insurable loss. Businesses feel that insurance is an unnecessary expense which they can do without. However when an emergency occur they are unable to perform critical performance functions and as a result suffer huge financial losses. These disasters are normally either natural or human induced disasters. Important equipment such as technology and machinery may be lost during such an incident and the business will be unable to operate. At times businesses have to close down because they do not have the finances to replace their losses. Natural disasters such as floods, hurricanes, tornadoes or earthquakes can be destructive and unavoidable. While preventing a natural disaster is impossible, risk management measures such as avoiding disaster-prone situations and good planning can help. Proper insurance to safe guard against financial losses is essential. In an emergency assets and property can be destroyed or damaged and human lives may be lost. As a business owner you are responsible for any injuries to visitors and employees alike. This may result in serious financial losses and liabilities. With insurance cover the blow will be less severe. All your old equipment will be replaced at current replacement value. In other words your old goods will be replaced with new ones. In addition to these losses you are faced with litigation costs from injured parties. This can surely destroy any good business. Even worse you could be one of the injured parties and you will have to pay huge medical bills which could have been prevented had you taken out medical insurance. Not to mention the fact that your will be without an income for a while. This too could have been avoided had insurance against loss of income been taken out. If you are in the technology business vital sensitive information may be destroyed or floating around and may end up in criminal hands.
When an individual purchases a motor vehicle it is important to take out insurance in case of accidents or disasters. If your vehicle is totaled it may take a long time for you to be able to replace it without insurance. However if your vehicle is insured you will have peace of mind because all injured parties will be compensated as well as your vehicle repaired or replaced. The vehicle you were involved in a collision with will also be repaired or replaced. All you have to do is to pay for deductible and excess. This is negligible in comparison with the potential risks. Due to the uncertainties we face we have to take out risk cover. Should any disaster strike it will not have any impact on your lifestyle. You will be unable to support your dependants and young children cannot understand. They will be devastated and unprotected.
Insurance is protection against various risks such as ill health, death, losing your car, house and health. The risk of losing your job due to ill health is a definite threat which no one should take for granted. In addition to taking out life cover, dreaded disease cover is also available. Should you become terminally ill without dying, your hospital and doctors bills could have an impact on your family. You may lose your property which you purchased because you did not take out insurance against unemployment.
There are four types of life insurance policies:
Whole life policy is where the insured pay the premium for the duration of his life and the policy pays out when he is deceased or terminally ill whichever comes first.
Endowment policy is taken out for a certain term such as 5, 10, 15 or 20 years. The policy remains in existence until the term expires or death whichever comes first.
Term policy: Is taken out for a specified term only. If the insured lives past the expiry date, insured will forfeit all the benefits. He will be paid out if he dies before the expiry date of the term policy.
Multipurpose policy: Includes several benefits through a single policy such as, old age benefit, retirement age benefit, income assurance benefit, dependent protection benefit etc. against the payment of a certain premium.
To remain financially stable a person needs to take out insurance to protect his family, business and assets against potential losses. Although insurance is optional and not mandatory it is important for us to know the pitfalls and potential dangers of not being insured. It is better to be under insured if you are financially unable to afford it but no insurance at all is a total disaster.
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Enhanced Insurance is not written by attorneys. If you’re looking for legal advice, you need to contact a lawyer. Further, insurance practices and forms change constantly and are varied from state to state. For definitive answers in your area, contact a local agent.
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