A Beginner’s Guide to Insurance

By: Marie Claire Lagrisola
A Beginners Guide to Insurance

Insurance. You may have heard of it. Even so, you still have reservations about getting one. Most likely it is because you lack reliable, unbiased information about the subject. Fret no more because we are just about to fix that problem. Read more to know about the ins and outs of getting insurance.

Why you should get insurance coverage? It is better safe than sorry

Don’t we all want some kind of assurance when it comes to the health and safety of you and your family? When it comes to the lives of your spouse and your children, don’t you always want to have some kind of peace of mind that you have a backup plan whenever accidents happen? When a storm suddenly hits and heavily damages your house and lot for sale, and you are already in a difficult financial situation, where will you and your loved ones live now?

Whatever should you do?

“It is better safe than sorry” is the sentence above that pretty much sums up insurance. This prospect has many definitions that almost are all in line with that saying. When you accidentally get into a car accident and for some reason you do not have enough money to pay for the damages or medical expenses because let us say, for example, your business is running low, what should you do? Where do you get the immediate money to repair your car without loaning anything? No sweat, your car insurance will cover just that.

However, if you do not have insurance, you will be at loose ends since you do not have any backup plans such as insurance

To put it more simply, insurance is used to reduce the difficulty and for financial security. When things go downhill, (God forbid) your business goes bankrupt, your child gets sick, you suddenly lose a leg during that mountain climbing trip, and you have something to help bounce right back financially. It is protection that can help cover the financial cost of unexpected events such as theft, illness, property damage, or death.


How does insurance work?

Insurance is done through annual premiums or monthly premiums. It is like paying monthly for a premium account for Spotify or Netflix. Only it is your life, your house and lot for sale, your car, or your leg. Or all of the above. You pay every month or every year to the insurance company to insure your vehicle, property, health, or life for a certain period of time. In return, if anything negative occurs to what you have insured, the company will then pay for the financial damages.

Before that, however, usually insurance companies require some documents to be submitted before you take the benefits of your insurance. This usually depends on what you insured and what kind of damages that had occurred. During claim processing or investigation, photographs of your leg injury, pictures of your damaged house and lot for sale or car, or a death certificate are one of the things you would have to submit. Again, all are subject to what kind of insurance you have been paying for.

It is like some kind of investment, but it is the kind that is literally your future. No matter how hard-working we are nor no matter how careful we are in our lives, there is always the inevitable. There are always going to be some things that are just out of our control, a very good example is the current global pandemic, and just like preparing medical kits, and escape routes, investing in insurance is great preparation to avoid financial hardships in the future.


How do you apply?

Insurance companies will thoroughly evaluate and see to it if they can issue the insurance policy through certain criteria such as age, medical history, previous claims made, and the amount of coverage you are requesting for future financial aid if or when the accident occurs.

For example, if you are applying for a life insurance policy, you would be required to submit a medical exam. Hereafter, the company will then review your application and access your medical and personal history to get to know you and the risks you face day to day. For example, you are an avid smoker. Most likely the insurance company will then charge you more than a person who does not smoke. Or, say you previously had a stroke. Again, you will be requested to pay more. But if you have been taking care of yourself all through your life and you have little to no life accident occurrences, you will then have to pay a lower required amount of insurance since the company knows you are careful.

Basically, the company will find out if you are indeed qualified and fitted for the premiums you need to pay.

And although, the next piece of advice is pretty basic and perhaps you may argue that we should not even write about this, however, many people try to cheat their way through insurance policies to get their benefits to the maximum and right away. You may have watched a horrific documentary or a movie about someone killing their relative and trying to make it seem like it was a natural occurrence, let us say, old age, just so they can get their hands into their life insurance. However, insurance companies already know all of the tricks one can possibly do and many people get into trouble for such cheating. Thus, when applying for claiming benefits, your application should be fully honest. If you hide some important information or you lie about something, it can be a basis for canceling your insurance account, making all the money you have previously paid be for naught. Additionally, this will be on your record and you might even go to jail for it.

For the sake of your and your family’s name and business, you do not want your name to get tainted, do you?

Indeed, having some kind of insurance, especially on things that are essential and things or persons you hold on to dearly, is a kind of investment that you must delve into. It just makes sense. Investing in insurance is indeed a risk since it is another reason for money to go out of your pockets, but are you willing to take a much bigger and more expensive risk in the future?

There are different types of insurance and insurance options. A few are life insurance, health insurance, car insurance, education insurance, and more. Click the link below to learn more.

Read more: The Different Types of Insurances You Might Want to Get

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