1. Business Law PLC Version
Insurance
Business Law
PLC Version

2. What is Insurance?
A contract between two parties where because of consideration which means a form of payment one party agrees to compensate the 2nd party when they suffer a loss of some type.
Examples of Loss:
Damage to home (natural disaster or fire)
Damage to car (accident)
Loss of life (death)
Loss of health (sickness)
Loss or damage of personal property (theft or fire)

3. Why Buy Insurance?
To prevent a family or business from being financially devastated when they suffer a loss of some type.

4. How Does Insurance Work?
A person buys a policy based on their need.
Example: All homes that are financed must buy property insurance in order to have the loan financed by a banking institution. (no exceptions)
Proof of insurance must be provided before closing on a piece of property.
In most states, cars must carry some type of automobile insurance in case the owner or driver is in an accident.
The State of Georgia requires proof of insurance before you are allowed to purchase a tag.
If you allow your insurance to lapse and you are in a wreck or stopped by the police, you could possibly go to jail and your car would be impounded until you paid the bill, fines, and penalties to the state.

5. Is Insurance Easy to Get?
In most cases, yes but in many cases if you have a lot of claims on your policy, your insurance could possibly be cancelled.
Example: 2 or more claims on damages with your home within a short length of time could possibly get your homeowners insurance cancelled.
Same thing could happen with claims on your car.
The higher number of claims the greater chance of your premiums increasing and your policy being cancelled.
When a student goes on a parent’s policy, the parent’s policy increases drastically. Male students’ policies are higher than females. Your policy premium goes down as you age and have no accidents. If you have no accidents and can provide proof of Driver’s Education, and good grades your parents can possibly get discounts on the policy.

6. Is Insurance Easy to Get?
Health Insurance is easy to get if you are a healthy individual and/or young.
The older a person gets and the greater number of illnesses you have will cause you to have higher premiums and possibly have a problem getting coverage.
With the new Obamacare package, a person cannot be denied coverage because of a preexisting condition as of January However, there is no restriction to the price of the premium that can be charged by the insurance companies.

7. Renter’s Insurance
A type of coverage that tenants buy when renting a piece of property.
Most landlords specify in the lease that their homeowners property insurance does not cover the tenant’s belongings.
Suggestion: Good idea to buy this policy if you are renting.
Not very expensive

8. Does a Business Need Insurance?
Yes, definitely. Insurance helps to protect a business from risks.
Types of Risks
Damage to building and contents from natural disasters or fire
People bringing lawsuits against the company
People stealing
Sickness of employees
Loss of income
Owner dying

9. How Do You Purchase Insurance?
Pick a policy that covers what you need.
Be sure the dollar amount you are buying is enough to cover the costs of rebuilding or taking care of a loved one.
Insurance policies have limits. Know what they are! Once the money is gone, it is gone. The insurance will cover no more.
Be sure you know what is covered in the policy. Don’t be caught off guard. Ex: Most homeowner’s policies do not cover floods. You must buy a separate flood policy.
Always pay your bills on time. If a policy is past due and a damage occurs, the policy will not be in effect. You must then cover it out of your own pocket.

10. Insurance is not a bad thing!