Insurance | Everything you need to know

Insurance – Meaning of it in real sense

Insurance is a means of protection from financial loss. Insurance | Everything you need to know – It is a form of risk management, primarily used to hedge against the risk of a contingent or uncertain loss. The amount of money charged by the insurer to the policyholder for the coverage set forth in the insurance policy is called the premium – as per Wikipedia

the action, process, or means of insuring or the state of being insured usually against loss or damage by a contingent event (as death, fire, accident, or sickness) 2a : the business of insuring persons or property – as per Marriam-webster

Simply speaking, insurance is protection against the risk of loss, primarily financial loss. Insurance can be purchased to cover nearly any aspect of life, including your home, your automobile, your health, your income… the list is endless. … This is best portrayed in a simple example of how automobile insurance works – Insurance & Its examples

The basic concept of insurance is that one party, the insurer, will guarantee payment for an uncertain future event. Meanwhile, another party, the insured or the policyholder, pays a smaller premium to the insurer in exchange for that protection on that uncertain future occurrence – as per Investopedia

Now coming to next part:

Types of insurance :

• disability Insurance
• Life Insurance
• health Insurance
• Long term care insurance
• Liability Insurance
• automobile Insurance
• Homeowners & renters insurance

Terms to know before Insurance:

• Policy holder
• life assured
• Nominee
• Insurance Premium
• Insurance Maturity Age
• Insurance Premium payment
• Insurance policy Tenure
• Deductible
• Co-pay
• Co-insurance
• Insurance Beneficiary
• Provider Network
• DCC- Debt Cancellation Contract
• A&O
• Insurance Agent
• Assured
• Insurance Damages
• Claimant
• Claim
• Insurance Grace Period
• Insurance UnderWriters

There is always beneficial to have insurance at early age with some known benefits which are realized when you cross that age:

• Insurance Waiting period is less
• Insurance Coverage at greater stance
• very low chances of rejection of Insurance
• Bonus
• Wider variety of Insurance choices to choose from at young age
• Tax Benefit Insurance
• Low Premium Insurance ( very important)
• Insurance Duration
• No health checkup for Insurance
• Lower Quotes for Insurance

To note: if you have done insurance at age of 25, by age of 40 with period of 15 years, one would have already availed benefits by that time which is quite beneficial at that age

By saving a small amount at young age, one would have two benefits:

• saving money every month (which ultimately yields huge benefits)
• premium at young age is very less compared to age of 40

Always look for some small amount to be allocated every month on:

• Insurance
• Stock Options
• Mutual Funds

It is always to dream big but it always starts with very tiny steps

Closing lines:

All young people reading this, ask any one who is above age of 60 and what is the importance of insurance for them; get a reality check!!