Insurance is the cover that is offered against losses which may be caused by eventualities such as fire, theft, damages and other disasters which may cause financial loss. All types of businesses take insurance to protect them against any losses that may affect them. Home owners also take insurance covers to protect their houses against losses. Insurance is also taken against vehicles and other properties that need protection. Insurance against floods is taken for the business and it is known as business flood insurance. Insurance plays a very important role when it comes to mitigating the risks that are uncertain in our homes and business as well. This document will highlight the significance of insurance cover.
Security against risks that uncertain is provided by an insurance cover. People who own homes are compensated when they experiences losses if they had a home owner insurance cover. This could be as a result of floods, theft, fire or any other damage. When businesses experience losses they are also compensated if they had an insurance cover. In order to cover the loss, businesses and home owners usually pay a premium monthly, quarterly or even yearly.
Insurance policies are able to offer businesses and homeowners with a peace of mind. This is as a result of them not worrying about the possibility of losses. They are able to concentrate on their core business. When the risks happen and the businesses are compensated they benefit from the compensation and avoid undergoing loses as a result o the risk or damages caused. This helps them save money.
When taking loans or mortgages insurance policies can be used as security. Insurance policies that are taken by businesses give them access to easy loans. Individuals who have life policies are able to secure loans using the policy as security.
Insurance policies such as pension can be a source of income during retirement or old age. The policy enjoys tax benefits and this ensures that an individual is able to access the money when they need it later in life. A life insurance policy helps individuals save money which is accessed later when the policy matures. The insurance owner is able to enjoy this great source of income. The life insurance policy provides for the dependents of the policyholder, not just the owner. This is mainly when the person with a life cover passes away. Insurance companies have created employment by hiring people to work for them. There has been a reduction of unemployment rates as a result.