Insurance is basically a way of financial protection from potential financial loss due to some unforeseen events. It’s a type of risk management, mostly utilized to mitigate against the threat of some uncertain or contingent loss. In simple terms, insurance is an agreement or contract between two parties. The parties are usually people who are related by blood or marriage. The parties may be businesses or individuals. One of the main purposes of insurance is to provide financial protection to the insured from any unexpected loss in case the insured is prevented from producing some income for a defined period of time.
There are three types of insurance policies that most people are familiar with, namely Life, Property and Car Insurance. They cover different aspects of an individual’s life, as well as the related properties. Each policy has a specific premium rate. As a rule, the higher the premium, the lower the cost of the insurance policy.
Insurance policies generally have three major kinds: Policyholders (the policyholder, the one who has issued the insurance policy, or the person on whose behalf the policy was written), Insured Party (the one who is insured under the policy, or the person with whom the policyholder is related by blood or marriage), and Casualty. Policyholders are usually the persons who own the property or buildings on which the insured relies for its performance. In the case of life insurance policyholders, the beneficiaries will be the family or dependents. In the case of property insurance policyholders, the beneficiary is usually the landowner.
A variety of situations are considered “marital” under Philippine law. These circumstances include accidental deaths, legal separations, divorces, anniversaries, birthdays, and several other significant events in the life of the insured. Under these circumstances, the spouse is then regarded as the Insured Party or the covered person. Marriage is seen as the most common example of these situations. The death of an insured spouse is then viewed as a marine perils event.
There are instances when an individual may not be considered as a spouse because he or she is not related to the insurable party by blood or marriage. Under these circumstances, the insured individual may be treated as a persona different from the other party. This is known as the non-incidental perils policy. The insurer is then required to treat the insured individual as a persona different from the other person.
Permanent life insurance is often bought from a company that does not have an operating license. In these cases, the insurance company is considered a disregarded entity. As such, tax benefits may not be available to the insurer. However, tax benefits may still apply to the policyholder.
It is very important to read the fine print of any health insurance policy carefully. Many people do not understand the different types of insurance and assume that all of them are the same. In some cases, there is more than one type of insurance policy. For example, there are hospitalization insurance and also home health care insurance. There are also supplemental benefit insurance policies for people with chronic disabilities.
When considering buying health insurances, it is advisable to compare rates and premiums from at least three different insurance companies. There are advantages to buying insurances from more than one insurer. For example, when an individual buys an insurance policy from a group of companies, rates can be guaranteed. When looking at insurances from different companies, compare coverage, premiums, and benefits. By doing so, you will be able to select the best coverage for you at the best price.
