Insurance

What is Insurance?

Insurance is a way to protect yourself or your things from unexpected problems that could cost you a lot of money. You pay a small amount of money regularly to an insurance company, and in return, they promise to help you if something bad happens. For example, if you get sick or meet with an accident, they can help pay the expensive medical bills. Or if something valuable, like your car or house, gets damaged, they can help cover the costs. It's like having a safety net that helps you when things don't go as planned.

How Does Insurance Work?

Insurance works by spreading out the financial risk of unexpected events. When you buy insurance, you pay a small amount of money called a premium to the insurance company. In return, the company promises to help you if something bad happens. They collect premiums from many people, which creates a pool of money. When someone in the pool faces a problem covered by the insurance, like an accident or illness, the company uses the money from the pool to help them pay the bills. This way, individuals and businesses can protect themselves from big financial losses that could be difficult to handle on their own.

What is Insurance Premium?

A premium is the sum of money you pay to an insurance provider in exchange for the protection they offer. Normally, it is paid on a regular schedule, such as monthly or yearly. Numerous variables, such as the type of insurance, the coverage limits, the degree of risk involved with the insured person or property, and other pertinent information, affects the premium amount.

What is an Insurance Claim?

An insurance claim is a formal request that you make to your insurance company when something unexpected happens but it is covered by your insurance policy. You're asking the company to provide financial help as per the terms of your policy. You give them details and proof of what happened, and if they agree, they'll provide you with the appropriate compensation or support.