Insurance can be a confusing and complicated topic for many people. With so many different types of policies, coverage, and terminology, it can be difficult to understand what you need and what you don’t. To help you make sense of it all, here are some common insurance questions answered.
What is the difference between term and permanent life insurance?
Term life insurance provides coverage for a specific period of time, typically 10, 20, or 30 years. If the insured person passes away during the term of the policy, the death benefit is paid out to the beneficiary. Permanent life insurance, on the other hand, provides coverage for the entire life of the insured person. The death benefit is paid out regardless of when the insured person passes away.
What is the difference between liability and collision coverage?
Liability coverage provides protection if you are found to be at fault in an accident. It covers the costs of any damage or injury you cause to another person or their property. Collision coverage, on the other hand, covers the costs of repairing or replacing your vehicle if it is damaged in an accident.
What is an umbrella policy?
An umbrella policy is a type of liability insurance that provides additional coverage beyond what is included in your existing liability policies. It helps to protect you from any legal or financial repercussions if you are found to be at fault in an accident.
What is the difference between a deductible and a co-pay?
A deductible is the amount of money you are required to pay out of pocket before your insurance policy kicks in. A co-pay is a fixed amount of money you are required to pay for each visit or service you receive.
What is the difference between HMO and PPO health insurance plans?
HMO plans require you to use in-network providers and require you to get a referral from your primary care physician before you can see a specialist. PPO plans allow you to use out-of-network providers and do not require a referral from your primary care physician before you can see a specialist.
We hope this article has helped to answer some of your common insurance questions. If you have any further questions, it’s always best to speak with an insurance agent or broker to get the answers you need.