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Insurance is a form of managing risks primarily by protecting a person, an agency or an organization from financial loss. Entities that provide these insurances are referred to as an insurance company, insurer as well as an insurance carrier. The policyholder or the insured refers to an individual or organization that takes an insurance cover. The role of the insurer is to compensate the insured in times of unexpected risk that results to financial loss. In case of a loss from occurring, the insured is compensated using the monthly or annual premiums they pay to the insurance company to cover for a given risk. A common pool of funds is created by the insurance company from various individuals and organizations who have taken insurance covers to compensate anyone who will be affected by a covered unexpected circumstance causing financial loss. There are various principles that govern insurance such as benefit insurance, indemnity, utmost good faith, insurable interest, proximate cause, subrogation, contribution as well as mitigation. There are various insurance covers that one can take to protect either their auto, home as well as a boat.
There are insurance covers that are meant for trucks, cars, motorcycles as well as other road vehicles is known as auto insurance. Financial losses that are likely to occur from risks such as traffic collision or any other incidence in a vehicle that causes physical damage or even bodily damage are the main roles of auto insurance. Some auto insurance can also cover against theft of the auto, natural disasters that may affect the vehicle as well as collision of the vehicle with stationary object. Some of the risks covered by an auto insurance includes property damage, the party insured, the vehicle insured as well as other third parties such as other cars, property, and people. The type of the vehicle, its value, the age of the vehicle among others are some of the factors that influence the value of premiums for the insurance cover.
Home insurance are insurance cover that covers damages and losses to a home or assets that may be found in the home. Home insurance also covers against accidents that may occur in a home and the property. A reliable insurance company is likely to enable proper coverage using the home insurance cover. Most financial lenders when providing mortgages requires that one’s home have a home insurance cover to act as a security for the lender. Covering of any financial losses that may occur from destruction and damage of cargo, ships, and terminals is known as boat insurance cover. The property covered by the boat insurance includes that property both offshore and onshore. The major benefit of home, auto, and boat insurance cover is that one has security against risks and uncertainties that are likely to occur in the future.