YOGYAKARTA - Most people have a kind of insurance: for cars, homes, or even their lives. But most of us don't stop thinking too much about what insurance is or how insurance works?
Simply put, insurance is a contract, represented by a policy, in which policyholders receive financial protection or compensation from insurance companies. The company's clients collect risks to make payments more affordable for the insured.
Insurance police are used to protect against the risk of financial loss, both large and small, which may be caused by damage to the insured or property, or from responsibility for damage or injury caused by third parties.
Insurance works by bringing together resources from large numbers of people who have similar risks to ensure that few people suffer losses are protected.
When you take an insurance policy and pay for insurance premiums, you put your own bit of money into that pool.
If your property is accidentally lost, stolen, damaged, or destroyed, and you have a general insurance policy that bears the property from that risk, you can file claims and use that collection of money to help pay for repair or replacement fees.
This allows you to avoid paying a full fee to replace, repair, rebuild, or return valuables if lost, stolen, damaged, or destroyed. It also means you can avoid large debt or liabilities.
When you pay the insurance premium, you will have access to a collection of money only if you claim a loss covered by your insurance policy.
Someone who has paid insurance premiums for years may never file a claim.
When you buy an insurance policy, your insurance company promises to pay you for the types of losses set out in the policy such as accidents, thefts, losss or catastrophe by funding repair or replacement of goods, to your policy limits, or sometimes by providing cash settlements.
Each insurance policy has different rules about what the policy will cover. Exceptions may apply, so you should read your policy carefully and ask for advice if you're not sure what your insurance will cover.
What is underwriting?
Guarantee is how insurance companies know how much it costs for every risk they bear for everyone who buys insurance policies and with what conditions.
When preparing a policy, the insurance guarantor will calculate:
How much they will agree to pay the loss
Under what circumstances will they make payments
How much premium will be obtained
Emission guaranteeers think of a number of different things when determining a certain risk price for insurance. For example, car insurance premiums can vary depending on the age, gender, and driving history of the main driver, as well as the location, type, and age of the car.
Each insurance company has its own guarantee guidelines to help determine whether they should accept the risks of a certain situation or not.
In some cases, insurance companies can decide they won't pose a certain risk while other insurance companies can.
Underwriting involves a low enough premium settlement to attract multiple buyers, and high enough that there will be enough money in the combined fund to pay for all the claims that might be made, plus generating profits for the shareholders of the insurance company..
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