Insurance Description contracts, contracts between the policyholder and the insurance company, take different forms depending on the risks they limit. The main categories include life, health, auto, travel, home, land, commercial and business insurance.

Some of us may think we have enough money to replace our possessions should something happen to them. The problem, however, is that the cost of injuring, disabling, or dying a loved one can, in most cases, exceed the  savings or assets accumulated. For this reason, insurance is an important part of financial planning.   Insurance  Description | Insurance: Definition, How It Works

Some of us may think that we have enough money to replace what we have if something happens to them. The problem, however, is that the cost of injuring, disabling, or dying a loved one can, in most cases, exceed the  savings or assets accumulated. For this reason, insurance is an important part of financial planning.

Buying insurance coverage is actually cheaper in the long run than having to use your hard-earned savings to cover a loss or property damage, especially when it’s an expensive expense.

What is insurance?

insurance is a risk transfer mechanism that shifts liability for losses to professionals called insurance companies, who manage the risk by spreading it among a large number of people or companies. Insurance can help  cover unforeseen events such as

theft, illness or property damage. If you buy insurance for  your property, the insurance company will pay you an amount equal to the value of your lost property. You can also take out life insurance to protect your loved ones in the event of your death.   Insurance  Description | Insurance: Definition, How It Works

                                       Why is it worth taking out insurance? 

insurance can protect you from financial loss when the unexpected happens. Accidents and disasters can happen and if you are not properly insured it can lead to financial ruin. When you buy insurance, you pass the cost of  potential damage on to the insurance company  for a fee called a premium. Insurance companies invest the funds securely, so they can grow, and can be used to pay claims as they arise.

The decision to get insurance will depend on your circumstances and your stage in life. Examples of insurance protection include:   Insurance  Description | Insurance: Definition, How It Works

Automobile insurance: This will pay for the cost of repairs to your vehicle if you have an accident or pay you the Insurance Description insured value, if your vehicle is stolen. It will also protect against loss to third parties.