It is quite funny reading this, but one third of the homeowner insurance liabilities are paid outs due to dog bites and that is in turn driving up Insurance Premiums. Either insurance companies take this trend into account and up the insurance premiums which homeowners won't really welcome or they do something about it - add another tiny line into their insurance clauses that they do not cover "vicious dogs", can be kind of funny when the dog that bite you is a Chihuahua, wonder how is the Insurance company going to define a Chihuahua as a vicious dog? :)
Well, when a dog bites a human that is not news, but when a human bites a dog, this is news and we are getting more and more of such news. One question to the insurance company will be, will the insurance company covers the dog that was bitten by a human being? Also how about dog bites dog or cat bites dog (my cat love to bully dogs) and the various permutations. I must say that being an insurance company is not as easy as it was previously. We have to take into account all sorts of funny and crazy acts.
One of the largest bank in the world HSBC, has put up their Vietnam Insurance Unit for Sale. This is expected to fetch the bank US$400 million which is a large sum of money for anyone but peanuts for this Europe largest bank.
The sale was because the bank was trying to exit from non core businesses. Baoviet Holdings, the Vietnam Insurance Unit was 18% owned by HSBC with a market value of US$250 million. But the analysts expect a far higher premium given the market position and advantages of this unit.
Insurance has evolved too much until basically the typical Man in the Street will not know what he is insured for as there are too many types and variations of insurance. Therefore it is very likely that a person may under or over insured himself or buy policies that are of no real benefits to himself. Nowadays insurance are crafted as much as possible in standard English rather than any technical or domain jargon. The insurance agencies had understand this the hard ways when judges ruled against them when they themselves do not understand what they are reading.
Insurance A is not the same as Insurance B and agent A is not the same as agent B. How good the Insurance agent is in his or her job can really determine if you profit from your insurance policy or not. Taking for instance, life insurance, you paid for tens of years and expect that at the end of it, you will be wealthy. This is extremely far away from the fact. In reality, insurance is one of those financial products with the worse financial returns. So, do not just buy an insurance recommended by a friend or relative, do check the fine prints carefully to ensure that you really get what you think you will get.
What is Third Party Insurance? Well the one that is purchasing the insurance, You for example is the First Person. The second Person is the Insurance company and the Third Person is the one seeking for damages. So why do you have third party insurance? For example, if you have a customer coming to your office and accidentally slip and hurt himself or herself seriously? Who is to pay? No one can guarantee that such things do not happen. This is where Third Party Insurance comes in. The Second Party - the Insurance company will pay so that the First Party is insured and secured. Of course the Second Party needs to get something so as to make it worthwhile to protect the first Party and this is known as the Insurance Premium.
For most individuals, they want to live their lives normally. A sudden disruption caused by illness, accidents etc that can result in drastic changes of their lifestyles are normally feared. That is why they are willing to pay a premium to ensure that should such things happen, they can be protected and live as per normal. For insurance companies, what do they get out of insuring you? Well, not all incidents will happen to everyone. They insured a large number of individuals and typically only a small percentage realized their insurance or make use of their insurance. The insurance company can pocket the rest of the premiums as profits.
What is life insurance. I think we need to determine what is the meaning of life. Is it for the whole life of the person being insured or is it for the life of the insurance policy? It can be quite confusing with a lot of permutations. If you want to protect yourself to your natural death and also maybe benefit some of your descendents with the pay offs, you may want to get a whole life insurance till you pass away. But that is going to be expensive and it also depends on your risk appetite and financial requirements.
Another sort of life insurance is to insured you by terms. For example you may want to insured yourself for 5 to 10 years because this is an important period of your life and you do not want anything unusual to happen, or if it happens, you are covered by insurance? This is one kind to take. A lot of companies also do offer term life insurance to their employees. But normally such terms end when the employees leave the company. Of course there are always ways to arrange such that the employees can continue the insurance by paying it himself etc.
The importance of buying personal insurance cannot be understated. There are a lot of personal insurance available to suit one's needs. Not everyone have the same needs and it is best to get an Insurance agent or Financial advisers as they are commonly called nowadays to prepare one for you.
Why is it necessary to pay a premium for insurance every year? We are living in a very unpredictable world. Have you read the newspapers of young adults dying in their sleep without any symptoms at all? Touch wood, that it won't happen to you. But better than touching wood, it will be more advantages to get a personal insurance that can help your family should you met with any accidents or change of circumstances. Be Prepared is much better than regretting when it is too late.
Insurance is comment in the world in which we are living today. But not all insurances, some are still extremely complicated and only the experts know what they are talking about. The common insurances that we know about are Health Insurance, Auto Insurance, Accident coverage insurance and unemployment insurance. Why do we take insurance and pay the insurance companies year after year? This is our adverse fear of the unknown. For instance, Health insurance, a lot of us take it when we are healthy, why is that so? We take the insurance to protect ourselves against unknown diseases or misfortune that may befall us.
To know what is insurance, we need to know what is risk. Risk is actually the standard deviation from the expected returns. For example, if you invest $100 and you expected and get $100 there is totally no risk. But if you invest $100 and you expect to get between $10-1000 then it is a very big risk. For us we do not like risk, you won't want your $10 to belong $1 or $100 the next time and keep changing? Therefore insurance comes in.
An Old Insurance Contract from Public Domain
Insurance is actually to manage your risk, be it your health, property and nowadays almost anything. There are even derivatives of insurance and exotic futures tied to insurance. It is a very complicated but interesting field to explore. I open this blog to learn more about insurance and hope that you can learn with me.
