Why do people purchase insurance Describe one of the types o

Why do people purchase insurance? Describe one of the types of insurance that is available and why you feel it is important.

Solution

People need insurance for the following reasons:-

1) Insurance is a way of managing risks. When you buy insurance, you transfer the cost of a potential loss to the insurance company in exchange for a fee, known as the premium. Insurance companies invest the funds securely, so it can grow, and pay out when there’s a claim.

2) Insurance will help you to own home, because mortgage lenders need to know your home is protected.

3) Insurance will help you to Drive vehicles,  because few people could afford the repairs, health care costs and legal expenses associated with collisions and injuries without coverage.

4) Insurance will help you to cover health care costs like prescription drugs, dental care, vision care and other health-related items.

5) And also help you to provide for your family in the event of a death.

TYPES OF INSURANCES:-

1) Life insurance:-

a) Term life insurance is a good choice as it becomes less and less expensive, and some policies do not require a health screening.

b) The death benefit helps to replace your income your family depends on. They can use it to pay for things like the mortgage on your home or for your children’s college education.

2) Long term care insurance:-

a) This is something that most people should seriously think about given that the price for long-term care keeps going up.

b) here are two types of long-term care policies, traditional and hybrid. The former is relatively straight forward, writes Keith Eig, a long-term care insurance specialist at Greenberg, Wexler and Eig LLC.

3) Disability insurance:-

a) Disability insurance is actually quite a bit like life insurance. It reimburses you for income lost during periods of time that you are not able to work.

b) Disability insurance can cover permanent, temporary, partial and total disability.

4) Health insurance:-

a) Solopreneurs are often preoccupied with health insurance, and it’s easy to understand why. Health care can cost a fortune, and that is why good coverage is essential.

b) Eventually, you will need medical care of one kind or another, and without insurance, even simple procedures can cost an arm and a leg.

5) Liability insurance:-

a) General liability insurance covers bodily injuries and property damage resulting from products or services your company provides, as well as any accidents that occur on your property.

b)  Professional liability coverage protects you and your business in the event that you are charged with negligence or misconduct.