House and property insurance decrease the probability of being entirely responsible for major property damage. But in the event that you are, it can be an excellent way to protect your assets. Read on to learn a little more about what insurance is and how it works!
What is insurance? – Explained
What is House Insurance? – House and property insurance decrease the probability of being entirely responsible for major property damage. But in the event that you are, it can be an excellent way to protect your assets. Read on to learn a little more about what insurance is and how it works!
Insurance is always an excellent way to protect yourself and the things that you own. When it comes to insuring your home, there are different types of coverage available with varying costs. Each type of coverage has different things that are covered, so its important to read up on them before purchasing! When you have your house insured, or any other item or person insured, you do not carry the entire cost. Instead, it is split between the insurance company and you. This is called Premium Sharing . Your home insurance pays for damage in two ways: Replacement Cost – The current cost of materials and labor for a completely new replacement structure. Premium – The annual insurance payment that you make to the insurance company for your house and other items.
Insurance can often be confusing because its a term used in many different ways by different companies or people. It’s important to know the basic definition of insurance so that you can understand when someone talks about it, or when you hear it in a news story.
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What is insurance?
Insurance is a contract between you, the insured, and an insurance company where you pay them money in exchange for compensation or protection in the event of certain events or occurrences. These events are called Perils , and can vary depending on the type of insurance policy.
Property Insurance is also known as property damage insurance. Homeowners and renters both purchase property insurance to protect themselves from losses due to property damage to their home. Property damage includes damage by fire, windstorms, hail, vandalism or theft (burglary), water damage (leaks or floods), explosions, earthquakes, falling objects like tree limbs or lighting strikes.
Most home owners have both building and contents covered by their policy. Contents include furniture, appliances, electronics, etc. Building is normally covered for damage to the house itself. Contents are usually covered for the physical objects on your floors, up to a specified limit. Contents insurance does not cover replacement costs, but provides protection from burglary and accidental damage. If you have contents insurance and your home is burgled then if your home is insured find a replacement of just what was stolen and continue paying the rest of your premium as long as you keep paying it on time.
Renters may be eligible for contents insurance with some policies however you should check before signing up to be sure that it covers everything that you might need in the case of a fire or other catastrophes.
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