Introduction
Annual insurance is the amount of money which you need to have to pay for the insurance coverage of one year of duration. It depends on the type of annual insurance, that how much money is required to pay. Annual Insurance can be either of any type like life, health and auto. There are many factors of buying the coverage. Insurance is the amount of money which is given to hedge against any certain or uncertain loss. The risk can be transferred from one entity to another in exchange for one payment. Premium is the term used for the amount which is needed to be paid and charged for the certain insurance coverage. Annual Insurance has pooling funds which are used to pay for the losses, the entities of insurance are protected from the risks. In order to be an insurable risk, the risk insured must meet some of the characteristics. Insurance is the part of financial service industry and the commercial enterprise.
History
By saving money, individual companies can also self insure for the future losses. There are certain risks that can be insured by the companies which are private. There are seven characteristics that these companies share. There are large number of the similar exposure units. Insurance is operated through the pooling resources. Individual members of large classes are provided with the insurance policies. Insurers are benefited with the law of large numbers. In these cases predicted losses are similar to the actual losses. Lloyd’s of London is the insurance company in London which is famous for the insurance of life or health of the actors and many other famous entities. Next characteristic is the definite loss. The definite loss occurs at known time and place. The third characteristic is accidental loss. The loss that occurs should be pure. There are some of the events that are not considered to be insurable.
Features
Next characteristic is the large loss. From the perspective of insured, the size of loss should be meaningful. The expected cost of losses, administering the policy, adjusting losses, and supplying the capital and cost of issuing should be covered in the insurance premiums. The fifth characteristic is affordable premium. The transaction may have the form of insurance if there is no chance of failure. Next characteristic is the calculable loss. There are two elements which need to be estimable. These elements are attendant cost (It has to do with the ability of the person which is in possession) and the probability of the loss (which is an empirical exercise). Last characteristic is Limited risk of catastrophically large losses. The losses which are insurable are independent. These are actually non-catastrophic. The losses does not occur at the same time. The insurer does not bankrupt due to the severe but single loss.
Tips and comments
There are some the types of annual insurance like gap insurance, home insurance, auto insurance, health insurance, causality insurance, life insurance, accident, sickness and un-employment insurance, burial insurance and property insurance, liability insurance, and credit insurance. We can also have the vehicles on the insurance.
