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Insurance is a contract providing financial protection against unforeseen events in exchange for a premium, helping individuals recover from financial losses. Common types of insurance include life, health, auto, and homeowners insurance, each serving different needs and covering various risks. Selecting the appropriate insurance depends on personal factors such as age, lifestyle, and family situation.

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8 views

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Insurance is a contract providing financial protection against unforeseen events in exchange for a premium, helping individuals recover from financial losses. Common types of insurance include life, health, auto, and homeowners insurance, each serving different needs and covering various risks. Selecting the appropriate insurance depends on personal factors such as age, lifestyle, and family situation.

Uploaded by

sinargalaksigasindo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Insurance is a contract where an insurer promises to provide financial protection against

unforeseen events in exchange for a premium3. It helps individuals recover from financial
losses resulting from incidents like car accidents, property damage, or unexpected health
issues2. Selecting the right type and amount of insurance depends on factors like age,
lifestyle, employment benefits, and whether you have children1.

Here are some common types of insurance:

 Life Insurance: Provides a sum of money to beneficiaries upon the death of the
insured individual, assisting with funeral expenses, outstanding debt, or financial
support for family members24. The two basic types are whole life and term life1.
Term life covers a set period, while permanent life, like whole life, universal life, and
variable life, provides lifetime coverage and can build cash value4.
 Health Insurance: Helps individuals avoid paying the full costs of medical
expenses2. It can cover visits to the doctor, prescription medicines, and other
healthcare costs2. Different types of plans include Exclusive Provider Organizations
(EPOs), Health Maintenance Organizations (HMOs), Point of Service (POS) plans,
and Preferred Provider Organizations (PPOs)5.
 Auto Insurance: Protects individuals from financial losses associated with medical
expenses and repair costs due to car accidents, protecting the driver, passengers, and
other vehicles involved2. It includes liability coverage, which pays for property
damage and injuries caused to others if you're at fault1. Comprehensive coverage
covers theft and damage from events like floods and vandalism, while collision
insurance pays for car repairs after an accident, regardless of fault1.
Uninsured/underinsured motorist coverage pays for medical expenses and lost income
if an uninsured driver strikes your vehicle1.
 Homeowners Insurance: Protects you from financial losses related to your home,
covering expenses associated with repairs, destruction, maintenance, or replacing
damaged items2. It typically covers the home and its contents in the event of fire,
theft/vandalism, lightning, and wind4.

Other types of general insurance include3:

 Insurance against fire


 Insurance for travel
 Long-term disability coverage1

Citations:

1. https://www.investopedia.com/financial-edge/0212/4-types-of-insurance-everyone-
needs.aspx
2. https://corporatefinanceinstitute.com/resources/wealth-management/insurance-
coverage/
3. https://www.bhartiaxa.com/life-insurance/types-of-insurance
4. https://www.investopedia.com/terms/i/insurance-coverage.asp
5. https://www.healthcare.gov/choose-a-plan/plan-types/
6. https://www.citizensadvice.org.uk/consumer/insurance/types-of-insurance/
7. https://www.insurance.wa.gov/types-insurance
8. https://www.citizensinformation.ie/en/money-and-tax/personal-finance/insurance/
insurance/

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