Nicholson Insurance is a contract that transfers a certain risk from the insured (or policyholder) to the insurer. In exchange for a regular premium, the insurer promises to reimburse the insured for certain losses covered under the terms of the policy.
Insurance companies rely on actuaries to assess individual risks and price premiums accordingly. They also invest a portion of premiums to generate additional income.
Property insurance is a broad term that refers to a variety of policies that offer either property protection coverage or liability coverage for property owners. Property protection coverage reimburses the owner or renter of a structure and its contents for damage or theft, while liability insurance offers financial reimbursement to anyone who is injured on the property. A common type of property protection coverage is homeowners’ insurance, while other types include apartment tenants’ insurance and flood or earthquake insurance.
Insurance companies compete for your business by offering various coverages at different prices. They use a number of marketing methods, including telephone, mail, television advertising and sales offices to make you aware of their products. Most insurance agents are independent, representing several companies, while some are direct writers, selling only their own products. Insurance rates are based on a process called underwriting, which determines whether an insurer will sell you a policy and how much it will cost. Underwriting is influenced by your age and health, as well as the value of your home and its replacement cost.
A property insurance policy typically includes dwelling coverage, personal property coverage and liability coverage. Dwelling coverage protects your home against damage caused by fire, smoke, wind, hail, snow, ice and lightning. Personal property coverage (often referred to as “contents” coverage) protects your belongings, and liability coverage pays for any legal fees and expenses you incur if someone is hurt by an accident that occurs on your premises, regardless of who was at fault.
Some property insurance policies also include business interruption coverage. This pays your overhead if property damage renders your facility unusable. It is often combined with other commercial property coverage in a package known as a business owners’ policy. If you hire an agent or broker to shop your policy, be sure you understand how they will be compensated for their services. Many broker fees are earned and non-refundable, although you may be able to request a refund of the fee if your broker acted dishonestly or incompetently.
Auto Insurance
Auto insurance is a contract between an insured (you) and an insurer wherein you pay the insurer monthly premiums in exchange for coverage against certain events that may affect your financial position, such as car accidents. It also covers your liability against injuries and damages to third parties caused by the operation of your vehicle. In addition, many policies provide other benefits such as roadside assistance, loan/lease gap insurance and mechanical breakdown insurance.
Typically, automobile insurance policies are written for six or 12 months and are available in a wide range of coverage options. During the quoting process, you will be asked for information about your vehicle(s), your driving record and other factors that influence your risk. You will then receive quotes that allow you to compare and choose the coverage that is best for you.
In most cases, a standard policy will include liability coverage to cover bodily injury and property damage that you cause to other people in an accident. Liability limits usually start at a minimum of $25,000 per person and $50,000 per accident. Your vehicle’s value is also covered up to a limit of $75,000 or the actual cash value, whichever is less. Comprehensive coverage is often a requirement by lienholders or lessors on leased or financed vehicles and covers damage to your car from sources other than collision, including theft, vandalism, fire, acts of nature and glass.
Personal injury protection (PIP) or medical payments insurance pays for your and your passengers’ medical expenses regardless of who is at fault for the accident. This is optional, but highly recommended, in most states. Uninsured/underinsured motorist coverage, which is required in some states, pays your medical expenses and other related costs if the at-fault driver has no insurance or a coverage limit lower than your uninsured/underinsured motorist limits.
Other supplemental coverages include towing and labor coverage, rental reimbursement and extended transportation coverage. In addition, some insurers offer usage-based insurance that tracks and analyzes your driving behaviors and habits using a device in the vehicle or through a mobile app. This data is used to reward good driving behavior and reduce your insurance rates, which makes it a popular alternative to traditional auto insurance.
Life Insurance
The life insurance contract (also known as life assurance, especially in the Commonwealth of Nations) is an agreement between an insurer and a policyholder wherein the insurer promises to pay a specified beneficiary a sum of money upon the death of the insured. The policyholder pays the premium, either regularly or as a lump sum. Other events such as terminal illness or critical illness may also trigger payment. The primary purpose of life insurance is to alleviate financial loss or hardship suffered by loved ones upon the death of a family member. It may be used to fund funeral expenses, pay off debts, and provide income for dependents. In addition, some people take out life insurance for investment purposes. This practice, which is often referred to as stranger-originated life insurance or STOLI, undermines the primary purpose of life insurance and has led to regulatory action in some jurisdictions.
The cost of a life insurance policy is calculated based on the mortality tables, the age of the insured, and the health history of the applicant. This investigation and evaluation is known as underwriting. Applicants are usually required to answer a series of questions, with certain responses possibly meriting further investigation. Some insurers offer no-exam policies — called guaranteed issue — where the applicant is not subject to a medical exam and the approval process takes a day or a week, while others use a more traditional underwriting process with a medical examination and a review of the applicant’s prescription drug history.
Health Insurance
Health insurance is a type of personal financial protection that pays for some or all of a person’s medical and surgical expenses, as well as preventive care costs in exchange for a monthly premium. This type of coverage can be private or provided by the government, such as through Medicare or Medicaid. A person’s payment obligation ends once they reach their out-of-pocket maximum, which can be set for a specific benefit category or for all coverage in general.
It is advisable to choose health plans that have the most comprehensive scope of coverage, which will minimize out-of-pocket expenses during claims and provide better financial security. Also, look for add-on features that are offered by various health insurance companies to make customization possible.
It is also important to understand the terms and conditions of a policy before purchasing it. This includes information such as pre-existing conditions, sub-limits, waiting period, free-look period, etc. All of this can be found in a person’s policy document. These documents can be accessed online and should be read carefully to ensure understanding of the terms and conditions. This will help avoid miscommunication or confusion down the road. Also, it is important to know what types of providers are considered in-network and out-of-network.