The majority of people get insurance because:
* The law says they have to (for example, car insurance)
* They are concerned that an event might occur where they could not afford the consequences of (such as contents insurance)
* They are worried that an event may occur that their friends and relatives could not bear the burden of (such as life insurance)
Sometimes, others provide useful insurance. Your company may provide you with health insurance, for example. An endowment policy usually comes with life insurance.
Aside from these aspects, you will have to pay a fee to cover yourself against unpredictable risk. In theory, you can assure yourself for any amount, and against just about any event, that you like. An insurer will, however, assess the risk of you making a claim. Insurers use actuarial tables to work out what they think the risk of you claiming is, and adjust the fee, called the ‘premium’ accordingly. Continue reading ‘Insurance – What Are the Different Types and Why Do I Need Them?’ »