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Auto Insurance Policies, General Overview of Various Types of Insurance

Insurance plays various roles in our lives in that its importance could never be overemphasized. It is a necessity rather than an option, as it provides a sense of certainty, protection, and is an effective measure to reduce risk and prevent losses that may transpire in the future.

In essence an insurance policy is a legal, binding contract between a policy holder and an insurance provider. An insurance agreement states that providers of insurance agree on providing financial compensation during unfortunate circumstances namely illness, death, theft, burglary, inability to work, and legal expenses in exchange for premiums that are to be paid by the policy holder on a monthly or yearly basis.

Clearly an insurance policy aims to safeguard the best interests of policy holders by protecting them from such unwanted losses and sense of uncertainty through guaranteed payment at a given contingency. Insurance not only helps a single policy holder, but other individuals who are exposed to the same set of threats and losses and are, at the same time, enrolled under the same insurance firm. It is a cooperative tool which aims to spread losses, thus enabling policy holders to save on premiums while getting the same assurance of protection, safety, and peace of mind.
There are many types of insurance products in the market, but the most popular are car insurance, home insurance, and health insurance. Evidently, these three insurance policies carry different types of risks, thus it is only right to discuss them separately; cite their respective benefits and how each of them can truly help you in obtaining a sense of utmost security that only insurance can offer.
•    Health Insurance
As the old adage goes, Health is wealth. This can never be truer than in today’s society. The conveniences and technologies that we enjoy also carry hazards and risks to our health and well being. In addition, our genetic predispositions make us high risk in developing certain medical conditions which are also aggravated by a number of external factors.
To reduce the risk of complications from sickness caused by accidents and other external factors, health insurance is a necessary product to purchase. Health care in the country is expensive, in fact, the United States spend trillions of dollars for the delivery of health care and services alone. Paying hospitalization and medical treatments with your own money is impractical, as this action will certainly drain your wallet and your savings account as well. In order to get timely, quality health care, you will need to be enrolled in a health care insurance policy.
Majority of Americans have insurance as form of benefit from work. HMOs usually provide the health care services to policy holders. Those who are not under HMOs purchase private health insurance. Both of these insurance policies carry benefits as well as drawbacks.
For instance, a health insurance policy provided by the employer feature a number of constraints and limitations. The network of health care providers is limited and policy holders are most often warranted to pay a portion of total expenses before the health benefits kick in. On the other hand, private health insurance products offer a wider selection of health care providers and institutions under their network Policy holders are given the ability to choose their preferred health care and medical experts for management and treatment in the event of illness, injury, or accident. The only downside to private health insurance is that policy holders need to pay a higher premium than those who carry employer-based health insurance products.
Investment on health insurance directly means investing in a quality way of life.  Not only does health insurance pay for treatments and surgical procedures, but it may also be used for preventive care so as to ensure optimum productivity and excellent well-being of policy holders.
•    Home Insurance
Your home is not only your dream come true but an important investment as well. With this in mind, it is only crucial to provide utmost care and security on it by purchasing home insurance. To protect your dream home which you have worked hard for, you will need to get adequate home insurance coverage to protect it against certain risks or losses such as those caused by natural disasters such as tsunamis, earthquakes, hurricane, and floods among others. It should also be protected from unwanted situations such as theft, burglary, and even damage due to pollution or contamination.
Essentially, there are two types of home insurance product being sold to homeowners:
•    Building Insurance
•    Contents Insurance
Buildings insurance basically covers the actual housing structure. The insurance policy covers the components that make up the home such as awnings, walls, and windows among others. Permanent fixtures installed inside the home are also covered by building insurance. All buildings home insurance policies insure the home against storm, fire, theft, burglary, and subsidence.
Although it is not compulsory to purchase buildings insurance, mortgage lenders highly recommend this action so as to protect your home that is still deemed to be an investment by the lender.
Contents home insurance is also necessary since your home stores much of the valuables that you have purchased.  This coverage will insure important and highly valuable personal belongings from theft, fire, flood, explosion, and even earthquake. In the event of damage or loss, the insurance provider will pay out the claim so you will be able to have the cash needed to replace such valuable items.
Think of home insurance as one of the smartest investment that you can make to protect your assets and valuable property.
•    Auto Insurance
Obtaining an auto insurance is a requirement in almost all states in the United States. This insurance product protects you from unwanted situations such as accidents. It also provides adequate coverage to people who may be riding with you as well. Aside from protection to lives, auto insurance also provides adequate coverage to the vehicle and other people who might have gotten involved in the accident.
Aside from being a mandatory insurance product that motorists need to obtain, auto insurance policies also offer protection and a sense of security in that you will have peace of mind in the event of unwanted circumstances. For instance, you suffered from an accident and need to pay hospitalization bills as well as expenses that are associated with car repairs. The insurance provider will cover all these expenses provided that you file for an acceptable claim.
There are various types of auto insurance products, however most states require motorists to obtain minimum liability requirements namely:
•    Bodily injury liability
•    Property damage liability
The type of car insurance to purchase will highly depend on your needs, thus it is always best to assess your preferences and necessities prior to obtaining a car insurance policy.

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