Insurance





What You Need to Know About Insurance

Insurance is a necessity for people who want to ensure that an accident, mistake, or just plain bad luck doesn’t have severe financial consequences. It protects against property damage, medical bills, liability from car accidents, and even death.

Check out Bjak Car Insurance to learn more.

It is a way of transferring the risk of large losses to professionals in exchange for a small fee, called an insurance premium.

Homeowners Insurance

Homeowners insurance, or property insurance, adds an extra layer of financial protection for one of your most significant investments. Most mortgage companies require homeowners insurance as a condition of lending money for a residential real estate purchase. Likewise, most condominium associations require that members have coverage.

While the specifics vary by policy, most insurance companies generally offer a range of optional coverages to suit your unique needs. For example, many offer home-security discounts or credit-based rating factors. Similarly, most home insurance policies allow you to select your own deductible. A higher deductible typically results in lower premiums.

If you’re shopping for homeowners insurance, consider requesting quotes from companies with good claims histories and reputations. Look at company retention reports and online reviews, too. You might also be able to save by bundling your homeowners policy with other insurance contracts (like auto or health). A knowledgeable independent agent can help you compare options.

Auto Insurance

Auto insurance provides financial protection against damage to a policyholder’s car and liability that may result from incidents occurring while driving. It consists of several components including collision, comprehensive, and medical payments coverage. Some insurers offer additional options such as loan gap coverage, which pays the difference between the fair market value of a vehicle and the amount owed on the car loan; and underinsured motorist coverage.

In addition to comparing prices, it’s also important to consider an insurance company’s financial strength, reputation for customer service and specific coverages. An insurance company’s claims-paying ability rating is another important consideration.

Many insurers also offer usage-based insurance (UBI), which adjusts rates based on data gathered by the insurer from your vehicle’s onboard diagnostics port or an installed device that monitors your driving behavior. These programs can save you money if you’re a safe and responsible driver. However, be aware that this type of insurance can increase your premium if you get into an accident.

Umbrella Insurance

Umbrella insurance, sometimes called excess liability insurance, offers protection from large claims and lawsuits. It's typically intended to cover damages that exceed the limits of your home, auto and boat policies. It also covers legal fees and other charges associated with lawsuits.

It's important to consider the value of your assets and your potential future income when deciding whether to purchase umbrella coverage. A long, drawn-out lawsuit can be stressful and financially ruinous. Depending on the verdict, you may even lose your house or other property.

Candidates for umbrella insurance include people with significant assets or expensive items that could be at risk of being targeted by lawsuits, and those who engage in activities that increase their risk of being sued. However, it's important to note that an umbrella policy won't help with claims related to your own intentional actions (like slander or libel). Business property and activities are generally excluded as well.

Life Insurance

A life insurance policy is an agreement between you and the insurer to pay a specified amount upon your death to beneficiaries. It is a form of financial safety net that helps families stay secure, even in the face of unexpected expenses like funeral costs and large medical bills.

Some life insurance policies also pay dividends that can help build cash value. However, this is not guaranteed and may depend on the company’s experience, financial strength and claims-paying ability. Most life insurance policies have a contract term that lasts for 10, 20 or 30 years, with the policy face amount and death benefit remaining level throughout this period.

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