Types of Insurance (5 Common Types)

Posted by Grace under Insurance on October 21, 2014

Want to know which types of insurance do you need? Read this article. Here in InvestmentTotal.com, I inform the readers not only about investment opportunities, credit cards promos but the importance of insurances and the companies offering different types of insurance as well.

Let us know first the definition of insurance for you to understand enough what this is all about. Do you have a car, home, business? Are these things already insured? Are the primary income earner a.k.a “bread winner” of the family? Are you insured?

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What is Insurance?

It is important to know the meaning of insurance. “Insurance is the practice by which an individual secures financial compensation for a specified loss of damage resulting from risk of any sort, by contract with a company to which he pays regular premiums, the profession of drawing up some contracts, the contract drawn up, the protection afforded by this, the premium demanded for such protection, the sum for which something is insured”.

Insurance policy is the contract drawn up between an individual and an insurance company.
Insurant – someone to whom an insurance policy is issued.

Reference: The New Lexicon Webster’s Encyclopedic Dictionary of the English Language, Deluxe Edition

Importance of insurance, it is for protection for your assets or properties when damage occurred during unexpected events such as accident or disasters.

Read Also: How Does Life Insurance Work when You Die?

Rich people treat insurance as an “investment”. Do you also treat insurance the way rich people treat it? If you think insurance is expensive, you have to think what is the market value of your car, home or business. Would you pay 500 dollars insurance to make your $20,000 car to be insured? Of course!

Types of Insurance (5 Common Types)

Now you know the importance of insurance and its meaning. Let us continue talking about the types of insurances and here are they;

Home Insurance
Description: A types of insurance that protects properties. In real estate industry in USA, it is called as the homeowner’s insurance or HOI. You can the real estate broker about this, they know that a property must be insured after it has been purchased or bought.

Car Insurance
Description: Also called as the “vehicle” or “auto” insurance that covers the cost of damage if accident occurs. This is the first thing that a car owner should buy for his car as a protection. This types of insurance usually offers in the car store or other insurance companies.

Tips: You can ask the car sales representative if there is available auto/vehcile/car insurance that the company is offering. if none, ask him where to insured your new car.

Investment & Insurance
Description: Rich people and financial experts treat the insurance as an investment itself.

Business Insurance
Description: This types of insurance will help the business owner to minimize the risk associated in running a business by protecting investment capital.

Types of Insurance (5 Common Types)

Image Credit: US Army via Flickr CC 2.0

Credit Card Insurance
Description: This is a type of insurance that covers to pay off the minimum monthly payment if the credit card holder is not anymore capable in making such payments. This credit card insurance usually offered by the banks that offering a credit card.

Life Insurance
Description: it is a contract between the insured and the inrance company that when an insured clients was died, the beneficiaries will get a face amount value. This is recommended to all members of the family especially to the “bread winner” of the family.

Live Stock and Crop Insurance
Description: This insurance is good for agricultural business protecting the livestocks or crops. If you are raising hogs, chickens in a massive amounts, get a livestock insurance as a protection for your investment capital.

For some useful tips, find out how much should a life insurance would cost.

Final Thought: Get insurance not only for yourself but also for every other members of the family. Buy also an insurance for the protection of your assets and properties. You will never realize the importance of insurance unless something bad happened to you and to your properties. Go and get one!

Related Article: How Much Does Life Insurance Cost?

Money Quotes and Sayings for the Day:

To drive a car, I must have insurance in case there is a crash. When I invest in real estate, I have insurance in case of fire or other losses. – Robert T. Kiyosaki on Rich Dad’s Cash Flow Quadrant

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