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Business Insurance Basics Most businesses need to purchase at least the following four types of insurance:  1. Property Insurance Property insurance compensates a business if the property used in the business is lost or damaged as the result of various types of common perils, such as fire or theft. Property insurance covers not just a building or structure but also the contents, including office furnishings, inventory, raw materials, machinery, computers and other items vital to a business’s operations. Depending on the type of policy, property insurance may include coverage for equipment breakdown, removal of debris after a fire or other destructive event, some types of water damage and other losses.  Business Interruption Insurance  Also known as business income insurance, business interruption insurance is a type of property insurance. A business whose property has sustained a direct physical loss such as fire damage or a damaged roof due to a tree falling on it in a windstorm and h

Standard Homeowners Policy Exclusions Standard homeowners policies exclude coverage for flood, earthquake, war, nuclear accident, landslide, mudslide, sinkhole. Some of these exclusions are discussed below.  1. Floods  Flood damage is excluded under standard homeowners and renters insurance policies. Flood coverage, however, is available in the form of a separate policy both from the National Flood Insurance Program (NFIP) and from a few private insurers. Additional information on flood insurance can be found on the FloodSmart.gov Web site or by calling 888-379-9531. For coverage over and above the $250,000 limit for property and $100,000 for contents provided by the NFIP, excess flood insurance is available from private insurance companies. (See Topic on Flood Insurance on page 47 for further information.)  Tsunamis cause flood damage and are therefore only covered by a flood policy.  2. Earthquakes  Earthquake coverage can be a separate policy or an endorsement to a homeowners or ren

What Type of Disasters Are Covered ? Most homeowners policies cover the 16 disasters listed below. Some “bare bones” policies only cover the first 10:  • Fire or lightning • Windstorm or hail • Explosion • Riot or civil commotion • Damage caused by aircraft • Damage caused by vehicles • Smoke • Vandalism or malicious mischief • Theft • Volcanic eruption • Falling object • Weight of ice, snow or sleet • Accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning, or automatic fire-protective sprinkler system, or from a household appliance • Sudden and accidental tearing apart, cracking, burning, or bulging of a steam or hot water heating system, an air conditioning or automatic fireprotective system • Freezing of a plumbing, heating, air conditioning or automatic, fireprotective sprinkler system, or of a household appliance • Sudden and accidental damage from artificially generated electrical current (does not include loss to a tube, transistor o

Types of Homeowners Insurance Policies There are several types of homeowners insurance policies that differ in the amount of insurance coverage they provide. The different types are fairly standard throughout the country. However, individual states and companies may offer policies that are slightly different or go by other names such as “standard” or “deluxe.” People who rent the homes they live in have specific renters policies. The various types of homeowners insurance policies are listed below. • HO-3: This is the most common policy and protects the home from all perils except those specifically excluded. • HO-1: Limited coverage policy This “bare bones” policy provides coverage against the first 10 disasters. It is no longer available in most states. • HO-2: Basic policy A basic policy provides protection against all 16 disasters. There is a version of HO-2 designed for mobile homes. • HO-8: Older home Designed for older homes, this policy usually reimburses for damage on an actual

Homeowners Insurance Basics  Homeowners insurance provides financial protection against disasters. It is a package policy, which means that it covers both damage to property and liability, or legal responsibility, for any injuries and property damage policyholders or their families cause to other people. This includes damage caused by household pets. Damage caused by most disasters is covered but there are exceptions.  Standard homeowners policies do not cover flooding, earthquakes or poor maintenance. Flood coverage, however, is available in the form of a separate policy both from the National Flood Insurance Program (NFIP) and from a few private insurers. Earthquake coverage is available either in the form of an endorsement or as a separate policy. Most maintenance-related problems are the homeowners’ responsibility.  A standard homeowners insurance policy includes four essential types of coverage. They include: 1. Coverage for the Structure of the Home  This part of a policy pays to

Auto Insurance  Basics Auto insurance protects against financial loss in the event of an accident. It is a contract between the policyholder and the insurance company. The policyholder agrees to pay the premium and the insurance company agrees to pay losses as defined in the policy.  Auto insurance provides property, liability and medical coverage:  Property coverage pays for damage to, or theft of, the car. Liability coverage pays for the policyholder’s legal responsibility to others for bodily injury or property damage. Medical coverage pays for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses.  Most states require drivers to have auto liability insurance before they can legally drive a car. (Liability insurance pays the other driver’s medical, car repair and other costs when the policyholder is at fault in an auto accident.) All states have laws that set the minimum amounts of insurance or other financial security drivers have to pay for th

Insurance Basics Overview  The insurance industry safeguards the assets of its policyholders by transferring risk from an individual or business to an insurance company. Insurance companies act as financial intermediaries in that they invest the premiums they collect for providing this service. Insurance company size is usually measured by net premiums written, that is, premium revenues less amounts paid for reinsurance. There are three main insurance sectors: property/casualty, life/health and health insurance. Property/casualty (P/C) consists mainly of auto, home and commercial insurance. Life/health (L/H) consists mainly of life insurance and annuity products. Health insurance is offered by private health insurance companies and some L/H and P/C insurers, as well as by government programs such as Medicare.  Regulation  All types of insurance are regulated by the states, with each state having its own set of statutes and rules. State insurance departments oversee insurer solvency, ma

  Due to a lack of information on particular words specified in the car insurance policy document, most car owners buy a car insurance policy based on its coverage and premium but do not grasp its terms and conditions. As a result, using the policy becomes more difficult. As a result, before acquiring a vehicle insurance plan, it is advisable to familiarise yourself with the most prevalent car insurance dictionary words. To help you make an informed decision, let's look at some of the most common phrases related to vehicle insurance. Terms Commonly Used Among the often used terms are: ·          Covers with Add-ons Additional insurance coverage, known as add-ons or riders, can be purchased in addition to a Comprehensive Plan. These plans are not available as a standalone cover or in combination with a Third-Party Plan. Coverage or service-related add-on covers are also possible. A Zero Depreciation Add-on, for example, is more of a coverage-enhancing add-on, whereas a Roads