Insurance acts as a financial protection that provides assistance to cover any damage to yourself caused by others or damage to property. It is also works by paying someone else for should you be liable for injuring someone or causing property damage. Insurance is a contract that moves the danger of financial loss from an individual or business to insurance companies. The company collects a small amount of money from clients regularly and pools the money together to pay claims in the event of an incident.
Insurance is divided into two main categories:
Property and Casualty Insurance
Life and Health insurance
Property and casualty insurance provides protection to individuals and businesses for losses associated with goods or assets, whether financial or physical goods. Other forms of insurance – Life and Health provides protection from financial loss as a result of premature death, disease or illness. For an Insurance Brokers Bristol, visit a site like https://www.markrichard.co.uk/
Calculating insurance is using the law of large numbers and probabilities, various different risk calculations and then premiums can be set for the client. The level should be sufficient to meet the company’s future claims, to pay costs and achieve a fair profit, but not so much that it turns away customers.
The more chance there is of an event occurring for clients, such as living in a property on a flood plain that has a history of flooding, more and more insurance companies must collect enough in premiums to pay anticipated future claims.