Why is insurance important? Choose two types of insurance and discuss their characteristics.
According to Kagan J. (October 12, 2021), we can define insurance as a contract, which provides individuals or entities with financial protection from the insurance company when damages take place. There are different types of insurance, and the most common are life, homeowners, health, and auto insurance. In the modern world, where everything must be paid, it is very important to have insurance: it will help you pay for your financial losses caused by different types of damages. For example, your health insurance can help you pay for hospitalization and treatment, and auto insurance can help you pay for the repair bills after the accidents. Sometimes having insurance can save you almost a fortune!
The two types of insurance I have chosen for this discussion forum post are health insurance and auto insurance as soon as they are the ones that touch my family’s life the most. According to Kagan J. (2022), health insurance usually helps to pay for surgical and medical expenses, and it is quite often included in employer benefit packages. Even though it sounds great, such insurance can be a little tricky: it will work only in the network of designated healthcare providers, and if you need some medical help outside this network, the insurance company may not cover the payment or will ask you to pay a higher percentage of the cost. Also, if you get medical care without the preauthorization of the insurance company, it may also deny the payment. However, health insurance is definitely the type of insurance that everybody needs. You just need to carefully read your insurance plan and choose the one that suits you best. Some of them even cover your family members! For example, when my brother needs to travel with his family, he always pays for the insurance plan which will also cover his wife’s or daughter’s medical expenses as well.
According to Kagan J. (May 3, 2021), auto insurance can cover most of the costs when you are involved in an accident, your car is damaged in some way, or even when your vehicle is stolen. Prices and options can vary, depending on your gender, age, years of driving experience, history of accidents, and some other factors. In the USA, most states require at least the minimum amount of liability insurance coverage, and some of them also require covering even more. In my country, you are obliged to have at least one of two presented state auto insurances. One of them is obligatory and will cover payments for property, health, third party lives if you are responsible for the accident. The second one will additionally financially protect your vehicle in case of theft, natural disasters, or actions of hooligans. It may seem that having a good auto insurance plan can be expensive, but it is obvious that if you own a vehicle, such insurance can save you a lot of money in the long run.
References
Kagan J. (October 12, 2021). Insurance. Retrieved from https://www.investopedia.com/terms/i/insurance.asp
Kagan J. (March 6, 2022). Health Insurance Guide. Retrieved from https://www.investopedia.com/terms/h/healthinsurance.asp
Kagan J. (May 3, 2021). Auto Insurance. Retrieved from https://www.investopedia.com/terms/a/auto-insurance.asp