Why do we need insurance and how to secure one


Summer has begun. The Smith family went to summer house, where the father was bitten by a tick. The tick was pulled out to be tested and find out if it was infected, but out of panic they lost it. Therefore, they urgently went to the hospital for an injection of immunoglobulin.

The injection cost about $115. What else could have been done? Indeed, in such a situation, there are no other options. If a tick has bitten and there is no way to check whether it is infected, you need to urgently give an injection. But the injection could be free. If Mr Smith had an insurance policy (its cost is about $5), then the family would save $110.

After this incident, the Smith family annually insures all family members (and also vaccinates). It is not always possible to avoid troubles, but there is a way to compensate for the damage from them – to insure.

What is insurance


Insurance is a way to protect you and your property from various risks. It is of two types:

  • mandatory;
  • voluntary.

In the first case, insurance is necessary – this is dictated by law. There are few types of compulsory insurance:

  • medical;
  • pension;
  • third party liability insurance for vehicle owners;
  • liability insurance for businessmen as well as for several groups of professionals. For example, it is necessary to insure those who work as a notary, depositary, cadastral engineer, appraiser, arbitration manager or customs representative.
It happens that insurance is a prerequisite for issuing a visa to enter some countries. But from the point of view of the law, this is not a mandatory type of insurance.

Voluntary insurance  is, as the name implies, a conscious choice. Almost everything can be insured: football players insure their legs, singers insure their voice. You can insure life, health, house, cottage, car. All types of insurance are listed in  the Law (Depending on your country).

Why do you need insurance?


Insurance does not protect against accidents, natural disasters, bankruptcy, illness and other unpleasant things. But it will help cover losses:

  • A scratch on a new car is unpleasant. But it is not so unpleasant if you have comprehensive insurance that will cover the cost of removing it.
  • Travel flu is a shame. But it’s not so sad if you have travel insurance, thanks to which your treatment will be free.
  • The neighborhood is flooded – it’s a shame. But it’s not so insulting if the insurance company pays for apartment repairs.

What to look for when choosing an insurance company

  1. License
    The company must have a license for a specific type of insurance. Check if there is a license for exactly the type that you need. Download the table “Subjects of the insurance business”, find the right company there and check. Also, the availability of a license can be checked online using the online Directories (subject to your country)
  2. Tariffs
    Insurance tariffs must comply with the requirements established by the Law. Very low rates can be a sign of a scam. The approximate cost of the policy can be calculated online on the website of the insurance company. Calculate the cost on the websites of different companies, check the numbers. Please note: the more risks provided for in the contract, the higher the price of insurance.
  3. Reputation
    Focus on well-known companies with a good reputation that have been operating in the market for a long time. Ask friends, read reviews on the Internet.
  4. Conditions
    Carefully study the conditions of insurance. Demand the full version of the contract, since far from everything is written on the policy form. Pay special attention to the paragraph where the signs of an insured event are listed. Find out what insurance doesn’t cover. Check with the representative of the company the procedure for indemnification in various situations, ask about the timing.

What is insurance fraud and how to avoid becoming a victim of fraud

The phrase “Insurance fraud” is more often used when talking about deception on the part of the insured – in cases where the client of the insurance company tries to illegally receive money. But customers who want to insure or have already done so can also face fraud or dishonesty of the insurance company.

Sale of fake policies

Insurance fraud


This is an actual problem for insurance policies. For example, a person bought a car and went to register it. On the way, He met street agents and immediately issued a policy for only $16. Seems like a good savings.

Formally, the form of such a policy is real, but in insurance companies it is listed as invalid (lost). And a client can ride with it for a whole year and not know that he bought a fake. Problems will begin if an insured event occurs. You will not be able to repair the car or receive money under this policy.

Online Fraud

You can take out a policy online for most types of insurance. This is convenient, saves time, and the main thing is not to get on a fake (phishing) page that duplicates the site of a real insurance company. Therefore, carefully check the page on which you plan to buy a policy. Make sure that this is the company’s official website: pay attention to the address in the browser’s address bar, to the secure connection icon or its absence.

The insurance company refuses to pay or underestimates them

And you are sure that there are no grounds for this and the truth is on your side. In this case, contact the appropriate authorities for in your country.

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