Tag: insurance

Insurance and it’s Types

N kavya

Insurance is a means of protection from financial loss. It is a form of risk management, primarily used to hedge against the risk of a contingent or uncertain loss. An entity that provides insurance is known as an insurer, an insurance company, an insurance carrier, or an underwriter. an arrangement with a company in which you pay them regular amounts of money and they agree to pay the costs if, for example, you die or are ill, or if you lose or damage something.

Insurance is a contract in which an insurer indemnifies another against losses from specific contingencies or perils. It helps to protect the insured person or their family against financial loss. There are many types of insurance policies. Life, health, homeowners, and auto are the most common forms of insurance. insurance is a contract, represented by a policy, in which a policyholder receives financial protection or reimbursement against losses from an insurance company. The company pools clients’ risks to make payments more affordable for the insured.

Insurance policies are used to hedge against the risk of financial losses, both big and small, that may result from damage to the insured or their property or liability for damage or injury caused to a third party.

Key Takeways :

1. Insurance is a contract (policy) in which an insurer indemnifies another against losses from specific contingencies or perils.

2. There are many types of insurance policies. Life, health, homeowners, and auto are the most common forms of insurance.

3. The core components that make up most insurance policies are the deductible, policy limit, and premium.

How Insurance Works :

A multitude of different types of insurance policies is available, and virtually any individual or business can find an insurance company willing to insure them—for a price. The most common types of personal insurance policies are auto, health, homeowners, and life. Most individuals in the United States have at least one of these types of insurance, and car insurance is required by law. Businesses require special types of insurance policies that insure against specific types of risks faced by a particular business. For example, a fast-food restaurant needs a policy that covers damage or injury that occurs as a result of cooking with a deep fryer. An auto dealer is not subject to this type of risk but does require coverage for damage or injury that could occur during test drives. There are also insurance policies available for very specific needs, such as kidnap and ransom (K&R), medical malpractice, and professional liability insurance, also known as errors and omissions insurance.

Insurance Policy Components:

A firm understanding of these concepts goes a long way in helping you choose the policy that best suits your needs. For instance, whole life insurance may or may not be the right type of life insurance for you. Three components of any type of insurance are crucial: premium, policy limit, and deductible.

1. Premium -:
A policy’s premium is its price, typically expressed as a monthly cost. The premium is determined by the insurer based on your or your business’s risk profile, which may include creditworthiness.

2. Policy Limit -:
The policy limit is the maximum amount that an insurer will pay under a policy for a covered loss. Maximums may be set per period (e.g., annual or policy term), per loss or injury, or over the life of the policy, also known as the lifetime maximum.

3. Deductible -:
The deductible is a specific amount that the policyholder must pay out of pocket before the insurer pays a claim. Deductibles serve as deterrents to large volumes of small and insignificant claims.

Types of Insurance :

There are many different types of insurance. Let’s look at the most important.

1.Health Insurance -:
Regarding health insurance, people who have chronic health issues or need regular medical attention should look for policies with lower deductibles. Though the annual premium is higher than a comparable policy with a higher deductible, less expensive access to medical care throughout the year may be worth the tradeoff.

2. Home Insurance -:
Homeowners insurance (also known as home insurance) protects your home and possessions against damage or theft. Virtually all mortgage companies require borrowers to have insurance coverage for the full or fair value of a property (usually the purchase price) and won’t make a loan or finance a residential real estate transaction without proof of it.

3. Auto Insurance -:
When you buy or lease a car, it’s important to protect that investment. Getting auto insurance can offer reassurance in case you’re involved in an accident or the vehicle is stolen, vandalized, or damaged by a natural disaster. Instead of paying out of pocket for auto accidents, people pay annual premiums to an auto insurance company; the company then pays all or most of the costs associated with an auto accident or other vehicle damage.


4. Life Insurance -:
Life insurance is a contract between an insurer and a policy owner. A life insurance policy guarantees that the insurer pays a sum of money to named beneficiaries when the insured dies in exchange for the premiums paid by the policyholder during their lifetime. Life insurance. life insurance provides for your family if you unexpectedly die. This is especially important if your family is dependent on your salary. Industry experts suggest a policy that pays out 10 times your yearly income. But not everyone can afford the cost. When estimating the amount of life insurance you need, factor in funeral expenses. Then calculate your family’s daily living expenses. These may include mortgage payments, outstanding loans, credit card debt, taxes, child care, and future college costs.


5. Travel Insurance -:
Travel insurance is a type of insurance that covers the costs and losses associated with traveling. It is useful protection for those traveling domestically or abroad.

6. Long-Term Disability Coverage -: Long-term disability insurance is the type of insurance most of us think we will never need. Yet, according to statistics from the Social Security Administration, one in four workers entering the workforce will become disabled and will be unable to work before they reach the age of retirement. Often, even workers who have great health insurance, a nice nest egg, and a good life insurance policy don’t prepare for the day when they might not be able to work for weeks, months, or ever again. While health insurance pays for hospitalization and medical bills, you’re still left with all of the expenses that your paycheck had covered.

Is insurance an asset?

Depending on the type of life insurance policy and how it is used, permanent life insurance can be considered a financial asset because of its ability to build cash value or be converted into cash. Simply put, most permanent life insurance policies can build cash value over time.

Conclusion:

Insurance plans will help you pay for medical emergencies, hospitalization, contraction of any illnesses and treatment, and medical care required in the future. The financial loss to the family due to the unfortunate death of the sole earner can be covered by insurance plans.




Why Take Health Insurance Plans in Difficult Times?

With all these healthy routines they are missing one of the most important steps that play a very important role in one’s health and treatment that is to secure their future health expenses by taking a liable health insurance plan. Health insurance equipped the person to take all the treatment and hospitalisation at a reasonable rate.

Currently, the world is dealing with the deadly coronavirus which was originated as the very new virus in late December 2019 in the city of Wuhan, Hubei, China. Even at the time, its name was not known than the situation gain international media’s coverage when virus cases started reporting from other countries as well along with a sharp increase in the death rate due to the coronavirus. The WHO declared it as the global pandemic in March 2020, with about 118,000 confirm cases with 4921 deaths in 114 countries.

The superpower of the world, the United States of America become the worst affected country in the world. Till now the USA has recorded 4.9 million confirmed cases with about 160 thousand deaths has been registered so far. In this dangerous and high-risk time of the pandemic, health-conscious Americans are taking all the necessary precautions to keep themselves fit and healthy. From following a healthy diet to regular exercising, they are doing almost everything to keep themselves away from the virus and other contagious diseases.

Importance of Health Insurance Plan

About 30 million workers living in America lost their jobs so does their health insurance plan during the outbreak of COVID 19 pandemic. Thus, along with the financial burden the Americans has to face the health crises and expenses also. As coronavirus treatment is the costliest so the necessity of a good health insurance plan for American citizens is enormous.

  • As the virus is new and unknown to scientists and doctors so the much study and research are not done on it as well as its vaccine formation time is still not confirmed so the treatment of virus is very expensive in different parts of the world. In America, thousands of dollars are required for the treatment of the corona patient. Because of these reasons, the need for good health insurance is essential.
  • As not only coronavirus but various other deadly viruses like Ebola, Zika and other dangerous diseases surrounds us and requires a lot of dollars for testing and treatment of the disease, so it is very beneficial to equip with the best health insurance policy to ensure the proper treatment and care by the health official at a very minimal rate which was already given to the health insurance company.
  • Health insurance also helps to maintain mental health along with the treatment of physical ailment. As the burden of disease and health problem is already on the mind of the patient so health insurance plan helps to detect financial burden from the mind and to maintain mental health.

As nothing is predictable in life, any unintended accidents can occur at any time of life. During these times health insurance plays a very vital role in saving our and our loves life. 

As corona is also one disease which can enter in our lives at any moment of our life, so advance maintenance and preparations are very essential especially in American cities like New York where there is a large spread of the disease. The first step in the preparation is to avail the honest and liable health insurance plan. 

Thus, along with following all the safety and hygiene protocols of Corona Virus, the person should also ensure the health insurance plan for themselves and their families. The Cities of New York and Boston are the worst affected so proper health insurance for its citizens is very essential.

Best Health Insurance Plan in New York

As the coronavirus claim a lot of deaths, some because of the lack of immunity while others due to the lack of money. The treatment and testing of Corona Virus are too expensive in New York city of America, the health insurance plays a vital role in ensuring treatment from the best doctors and the in the most renowned hospitals. The best insurance plans in New York health come under four categories.

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These are bronze plan, silver, gold and platinum health insurance plans, all vary in its prices. There is government sponsor health insurance plan Medicare that comes at $ 1,005 for the single person, and for married couples, it can be bought at $ 1,354 under its qualified beneficiary plan. Medicare provides four types of the best insurance plan in New York health.

There is also Medicaid health insurance plan for poor families that cannot afford other health insurance plans. About 6% of New York residents are uninsured that compels officials to make some more good policies.

Best Health Insurance Plans in Boston

The Boston city in the United States is also one of the worst affected city that provides some of the most renowned health insurance plans. The best health insurance plans in Boston includes a basic life insurance plan that can be brought at $ 5,000 but its amount may variant with the age of the person. The Medicare Retiree Health insurance plan allows the usage of coverage even after the retirement.

There are many more such health insurance schemes offers both by the government officials as well as the private insurance companies. The Obamacare Health plan that is giving benefits to many Americans, is providing a lot of health insurance plans in different parts of America. These are some of the best health insurance plans in Boston that are making the lives of many citizens easy.

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Conclusion

The Corona Virus Pandemic has put a halt to many things but it also brings the real condition of the health structure of many powerful countries. Even the most powerful and renowned country of the world, the United States of America is not able to control the virus initially that results in the thousands of deaths and millions of active cases. As well as millions of people lost their jobs and become unemployed.

In such a drastic and dangerous situation, the person’s health protector is a health insurance plan that protects the future of the person and makes it financially secured when such a disease or accident takes place. The Americans are looking for the best insurance plans that give them the most benefits of treatment and testing of the disease and by taking one of the health insurance plans our mind become peaceful without any worry of unpredictable tragedies of life.

Burden of healthcare on poor

When it comes to health care, every individual dreads it. Health care costs are taking a large chunk out of the savings of an individual. These costs make the lives of poor people more vulnerable. Though India is becoming a destination for foreigners to avail affordable health care, many Indians find health care services unaffordable. The treatment costs are rising at a much faster rate than inflation for both rural and urban areas. Also inefficiency of government hospitals and pharmacies have led people to turn towards private players resulting in increased health care costs.

The private expenditure on health care is around 4% in India, which makes it one of the highest ranking countries when it comes to private expenditure on health care. However, major costs of healthcare are born by individuals rather than insurance companies or employees. 

A research paper in BMJ, a medical weekly, reported that 55 million Indians-more than the population of South Korea- were pushed into poverty because of out of the pocket health expenses between 1994 to 2014. Out of those 55 million, 69% (38 million) were impoverished due to expenses on medicine alone. This study also reported that 80% Indians incurred out of the pocket expenses in 2011-12 which was 60% in 1993-94. The contribution of medicines was more than 67% of these out of the pocket expenses in 2011-12.

Government has rolled out various schemes to ensure that poor people don’t have to bear the costs of medicine. However, as per study by India’s largest national survey on social consumption conducted between July 2017 and June 2018, reported that 90% of India’s poor population do not have any health insurance. Despite of many health insurance schemes like Rashtriya Swasthya Bima Yojana (RSBY, National Health Insurance Scheme), which was precursor of PMJAY, the central government health schemes for government employees, the Employee State Insurance Scheme for formal sector employees, the poor did not have any kind of health insurance.

The health insurance coverage in India is poor because the private health insurance industry has not yet developed in India and the number of people who are willing to pay for health insurance are very low. Also the insurance premiums are high which makes health insurance unaffordable by many poor people. In rural India, people have limited access to healthcare services like doctors and hospitals, thus they do not prefer to buy health insurance.

This condition led the government to roll out an effective scheme and the result was Ayushman Bharat- National Health Protection Scheme(AB-NHPS) in 2018. The scheme is targeted at following categories:

  • Poor
  • Deprived rural families
  • Identified Occupational category of urban workers’ families

Benefits of this scheme

  • This scheme defined benefit cover of Rs 5 lakhs per family per year for secondary and tertiary care hospitalisation.
  • There is no cap on family size and age under this scheme.
  • This scheme will be cashless and paperless in public and enlisted private hospitals.

With Covid-19, poor are facing a lot of issues and all they need is support majorly in financal ways.