This is a process through which security against loss in value or worth is given. The entity which offers the protection against that financial loss is usually known as the insurer or underwriter. An insured is a person, set of individuals or organization that benefits from the protection of an insurance policy by an insurance company. The insurance policy is a documented contract that contains the terms and conditions under which the insured person or organization will be compensated by the insurance company in the event of a loss.
There is also an amount of money known as the premium that is usually charged by the insurance company to the insured for the covering agreed. A claim adjuster is usually processed by the insured in the process of making a claim to the insurance carrier in the event that a financial loss which is catered for in the insurance agreement happens. There are several guidelines that an insurance company will follow in issuing out insurance policies to the insured.
An insurance company will provide for an insurance cover for a loss in value in the event that there is a large number of like risks. The observation of large numbers of similar risks is so as to achieve the aspect of pooling of resources by the insurance company so as to enhance easy compensation during a claim by an insured. The kind of financial loss that is catered for in the insurance policy offered by an insurance company has to be definite in that its cause, time and place of happening can be determined.
Additionally, another ground for the provision of an insurance cover by the insurance carrier to the insured is that the loss has to he accidental. Another set guideline for the insurance company to give a covering against a financial loss is that the size of the expected loss has to be quite meaningful in the view of the insured. Similarly, the insurance company also has to make sure that the premium to be paid by the insured can be calculated and subdivided into small affordable amounts.
The easy estimation and approximation of an expected financial loss to be insured against and insurance cover given for by an insurance company is necessary. The insurance company also has to ensure that the risk being covered in an insurance policy has limited risk of consequentially large financial losses. An insurance company offers a number of insurance covers that protect against different financial losses.
A loss to a vehicle caused by an accident such as a traffic collision can be covered for by an insurance company in an auto insurance. Theft and other damages that may occur to the vehicle of the insured are also covered I the auto insurance.