2006-12-03T03:29:00.000-08:00

Insurance is a form of risk management used to Minimize loss or risk, against the danger of potential financial loss. Insurance is defined as the equitable transfer of the risk of a potential loss, from one entity to another, in exchange for a premium and duty of care.

Types of Insurance

Life insurance: It provides a cash benefit to a decedent's family or other designated beneficiary, and may specifically provide for burial, funeral and other final expenses.
Health insurance: It covers medical bills incurred because of illness or accidents.
Automobile insurance or auto insurance or car insurance(in the US,Canada) or motor insurance(in the UK) : It cover both legal liability claims against the driver and loss of or damage to the vehicle itself.

Other insurance

Most risk that can be quantified probably has a type of insurance to protect it

Boiler insurance or Boiler and Machinery insurance or Equipment Breakdown Insurance

Casualty insurance: insures against accidents

Credit insurance: When certain mishap happen to the borrower such as unemployment, disability, or death this insurance pays some or all of a loan back.

Financial loss insurance: protects individuals and companies against various financial risks.

Liability insurance: covers legal claims against the insured.eg; Doctors(Others purchase this as well) purchase this insurance to cover any legal claims against him for his negligence in treating a patient

Marine Insurance: covers the loss or damage of goods at sea..

Pet Insurance: Insures pets against illnesses and accidents

Professional Indemnity Insurance or Errors and Omissions Insurance: This is for professionals such as Architects, Lawyers, Doctors, Accountants or even web designers to provide insurance cover against potential negligence claims.

Property insurance( which includes fire insurance) :provides protection against risks to property

Terrorism insurance- this probably needs no explanation

Title insurance: It provides a guarantee that title to real property is vested in the mortgagee, free and clear of liens or encumbrances.

Travel insurance: It is handy for those who travel abroad, which covers certain losses such as medical expenses, lost of personal belongings, travel delay, etc.

Contract of Insurance

This is a contract whereby one person, called the Insurer, undertakes to make good the loss of another, called the Insured, by payment of money to him on the happening of a specified event.