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Insurance Services – Taking the Risk

Insurance is best described as a contract between an insurer and the insured. In its primitive form the contract states that the insurer will compensate the insured for an agreed value in the possible event of loss. There are however many more specific details stipulated within the contract in order to protect both the insurer and the insured.

All insurance services differ in some way or another, but most follow a basic set of principles and procedures. The insured usually pays premiums to the insurer at fixed increments in return for coverage, and in the event of loss the insurer covers the loss of the insured. Although it differs among insurance companies the insured is usually required to pay an excess amount before receiving payment or compensation from the insurer. The excess can be either a fixed amount or a percentage of the payout amount.

It is difficult for insurance companies to just charge all their customers the same premiums, since the coverage that customers seek vary, as well as the risk involved in insuring different individuals. For this reason Insurance companies require the insured customer to provide a list of the property and possessions they wish to have insured, and naturally the customers must have ownership of the property. The insurance company also assesses the risk involved in covering certain individuals. Usually this is determined through statistical models which take into consideration the risks involved with people of specific age groups, gender, place of residence, working conditions and many other factors.

In most cases insurance is taken out by individuals to protect them against the loss of property and goods. The nature of loss which they are protected against will vary depending on the contract and can include almost any possible scenario: theft, accidental breakage, loss or an act of god (a natural event over which people have no power, such as flooding etc.).

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There are many other forms of insurance besides the protection against the loss of tangible property. Health Insurance can be taken out, in which case the medical costs of the insured are covered by the insurer. Some insurance companies are willing to insure almost anything which involves a risk, but has no certainty attached to it. One example of the flexibility of insurance companies is an insurance contract that was taken out by a casino before opening its doors to the public. The casino ran a million dollar jackpot and insured it – In other words they paid a monthly premium, and in the event that a client won the jackpot the insurance company would pay out.

It is also possible for people to insure themselves. This is often the case when people make an income from their talents, or when certain parts of their anatomy are deemed to be a valuable asset. The most common scenario involves sports personalities, artisans and musicians who insure themselves or even just parts of their body against damage that may influence their careers and in turn their income. Insurance doesn’t just limit itself to these practical careers however, it is even possible for models and celebrities to insure themselves, and it is not unheard-of for models to insure their legs.

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