Insurance Coverage and Premium:

Insurance coverage is the amount of risk or liability that’s covered for a private or entity by way of insurance services. It helps a person to recover financially from unexpected events, like car accidents or property damages. To get the return for any coverage, the insured pays a premium to the insurance company. So later in return, the insurance company will pay the Insured for the financial damages in case the person or object insured is damaged.

Premium:

An insurance premium is the amount of money an individual or firm must pay for an insurance policy. Insurance premiums are purchased policies that cover healthcare, auto, home, and life assurance. When there’s a risk that an insurance company may have to pay out money toward a claim, they can levy that risk by imposing a higher premium.

For example, many insurers impose higher premiums for young male drivers, as the probability of young men being involved in an accident is usually higher than a middle-aged married man with years of driving experience.

Types of Insurance Coverage for Auto and Homeowners:

Auto Insurance Coverage
Auto insurance safeguards you in case of an accident. This comprises both bodily injury liability coverage and property damage liability coverage. Bodily injury liability coverage pays for the medical charges of another person if they’re injured in an accident that you’re responsible for. Property damage liability coverage pays for damages to someone else’s property when you’re responsible for an accident.

Some other coverages are as follows:

• Uninsured/underinsured motorist coverage
• Comprehensive coverage
• Collision coverage
• Medical payments coverage
• Personal injury protection (PIP)

The premium depends upon the following factors:

• If a driving record is free from accidents or serious traffic violations, one has to pay a lower premium. On the other hand, drivers with records of accidents or traffic violations may pay higher premiums.
• If a person drives his car for work or drives long distances on a daily basis. In general, they have to pay more for auto insurance premiums, because of his increased mileage that could increase his chances for accidents.
• Because of higher vandalism rates, thefts, and accidents, drivers residing in cities pay more premiums than those living in small towns or rural areas
• The cost and frequency of litigation
• Medical care
• Repair costs
• Prevalence of auto insurance fraud
• Weather trends

Homeowner’s Insurance

Homeowner’s insurance protects against financial losses associated with property and assets involving your home. Location plays a huge factor if the city is somewhat expensive and if you are living in the high theft zone in those cases you are likely to pay more premium coz of the lesser response time. The age of the home is also a factor, the older the house the riskier it is. Deductibles play a great role, the most common amount is 1000 dollars.

The premium depends upon the following factors:

• Location
• Age of house
• Deductibles
• Credit History
• Security system or smart home
• Fire extinguisher and alarms
• Hail resistant roof and storm shutters

Coverages include:

• Dwelling(property Coverage)
• Other structures(Property Coverage)
• Actual property damage(Personal property)
• Loss if Use(Property coverage)
• Personal Liability(Liability Insurance)
• Medical coverage(Liability Insurance)

Coverage calculations:

• Calculate the square foot of house multiplied with 160 dollars or near, more or like 3000 dollars to insure a 2000 square foot house comes in dwelling
• The separate structures have like 2 to 10 percent, it is going to be 30,000 for the shed and the fence and all that. You can raise that too
• Loss in use coverage, make sure you just have that covered so that you can make it to 5 to 6 months.
• Medical payments, it is more often 5000 dollars
• Personal Liability make it at least 5000 dollars, if you have more expensive assets then just make it to 5000 dollars liability and then add umbrella insurance on top of that since it will give you high coverage for it (it covers liability risks)

Homeowner’s insurance premiums can depend upon the worth of the house, policy coverage amounts, and where the house is found.
A list of some available Discounts is mentioned below:

• First-time home buyer
• Updated roof, plumbing, electrical, and heater
• Paperless
• Paying in full yourself vs. mortgage
• Affinity group
• High credit
• Nonsmoker
• Security system or smart home
• Fire extinguishers and alarms
• Hail-resistant roof and storm shutters

**The higher the deductible on an insurance contract, the lower the monthly or annual premium on an insurance policy.