What is Insurance?

The right type of insurance is critical when it comes to sound financial planning (forsikringsselskap norge) . Some people may have some form of insurance coverage but only a few comprehend what it is and its importance. Let’s take a look at detailed information about insurance:

What is Insurance?
Insurance is precisely a way of spreading out the compelling financial risk of either a business entity or a person to a large group of business entities or individuals in the occurrence of an unexpected and predefined event. Insurance cost is the monthly or annual premium that is paid to the insurance company (Forsikringer) . For pure insurance, the compensation is not done if the predefined event doesn’t occur within the specified period of the insurance contract. Insurance is an efficient means of spreading risk in a pool of insured people to lighten their financial burden in case the predefined event occurs. Insurance overs cover against risks that might lead to a significant loss, resulting to an end of business or substantial financial burden.

What is the Difference between an Insured and Insurer?
An insured is a person who makes a contract with an insurance provider to seek protection against financial risk. An insurer is the insurance company that provides the insurance cover to the insured.

Types of Insurance
Any risk that can be quantified in terms of money can be insured.
• Life Insurance policy is used to protect the loved ones against loss of income due to immature death.
• Mediclaim Policy can be used to offer protection to both you and your family against unexpected medical expenses.
• Motor Insurance policy can be used to protect your vehicle against robbery or any damage in case of an accident.
• Home Insurance policy can protect your home against theft, or any damage caused by fire, flood and other perils.

An insurance cover is a lifesaver against huge financial loss (Barneforsikring) . Transferring all predetermined risks to an insurer for compensation is critical.