Types of General Insurance Policies

If you get into a crash, auto insurance is a type you'll be glad you have. The insurance industry is a multi-billion dollar business that involves providing a sense of security as well as legal necessity in a wide range of areas. Insurance can be purchased to cover everything from a home to the family dog. While many different types of insurance exist, there are a few that are regarded as "general insurance policies" that many people commonly have.

1. Home Insurance
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ome insurance covers a person's place of residence or a home that they own and lease to someone else. This type of insurance pays to repair or replace the structure in the event of fires, tornado damage, theft and other unforeseen or accidental circumstances as well as some natural disasters, according to The!oan"a#aar.com. $dditional policies are often re%uired for flooding, earth%ua&e and hurricane coverage. With the si#eable investment related to the purchase of real estate, it is almost always certain that a homeowner has this &ind of policy in one form or another. If there is a mortgage on the property, the ban& will re%uire the owner to include a policy as a contingency of the loan.

2. Auto Insurance
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$uto insurance is re%uired by law to protect the vehicle, driver, passengers and others on the road around them. 'ince most people are involved in some way in automobile accidents over the course of their lives, it is important to have the right &ind of coverage should the unexpected happen. 'ome people may elect to carry liability coverage only. It is inexpensive and only covers the damage to the other car or people. It leaves the responsibility to repair your own car up to you. This is typically the

minimum insurance re%uired by law. Those with car loans or with expensive cars that would cost a lot to repair are li&ely to have full coverage insurance policies that include collision insurance for all parties involved. This type of insurance is re%uired for people with outstanding car loans in many instances and it will pay to repair the car and damage done to others if necessary.
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Health Insurance
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$lthough many people find themselves without health insurance, it is a common type of policy en(oyed by most $mericans. )ither through a private policy or a group health plan provided by an employer, health insurance is a necessity for those who can afford it. ealth insurance policies exist in many forms, but all of them are aimed at paying for expenses related to health care at hospitals, doctor's offices and clinics. The cost of health care is extremely high and unaffordable to most people, so in exchange for a si#eable premium, the insurance policy will pay to cover the largest portion of medical care bills and prescriptions.

Types & Definitions of General Insurance

With insurance, we're covered for things we cannot afford to replace on our own. *eneral insurance refers to all types of insurance other than life insurance. +ften called property and casualty insurance, general insurance pays for loss or damages to physical property, and for loss or in(ury to another party. The policy will specify the perils insured against, limits of insurance and deductible. *eneral insurance divides into personal lines, for individuals, and commercial lines, for business owners.

1. Homeowners Insurance
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Typically written as a pac&age policy, homeowners insurance pays for losses to the owner's home and personal belongings, and for the owner's personal liability. Typical perils insured against include lightning, fire, hail, wind, explosion, weight of ice and snow, theft and vandalism. omeowners may add separate clauses for earth%ua&es, and must purchase a separate policy for flood insurance. The owner must insure the home for its full replacement value, except in the case of very old or derelict homes, which may be insured for actual cash value only. ,ersonal liability covers in(ury or loss to another party while on the owner's property. -or example, if a visitor slips on ice that the owner did not clear, or the owner's dog bites someone, the policy will pay for medical treatment. omeowners insurance policies often exclude certain dog breeds, swimming pools and trampolines.

2. Flood Insurance
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-lood insurance covers losses to the owner's home and contents for damage caused by flood and mudslide. The flood #one in which the home is located determines rates.

Auto Insurance
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$uto insurance, also written as a pac&age, covers the owner's liability for bodily in(ury or property damage to another party that arises from an incident caused by a driver on the policy. The policy can also pay for collision and comprehensive damage to the owner's own vehicles, in(ury to the owner or another driver on his policy, towing or other emergency roadside service, and reimbursement for rental vehicles when re%uired as the result of a loss insured against in the policy.

ther Personal !ines

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.ou can also buy speciali#ed insurance policies for motorcycles, watercraft, motor homes, all-terrain vehicles and snowmobiles.

"usiness
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wners Personal Property

'imilar to a homeowners policy, a business owners personal property policy includes coverage for buildings and fixtures, as well as business property /including inventory0, and business liability for damages the

owner caused that result in bodily in(ury, property damage, or personal and advertising in(ury.

#ommercial General !ia$ility

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1ommercial general liability covers a business owner for damage or in(ury that occur during the operation of the business. undreds of business and trade classifications determine insurance premium rates for all the types of businesses that exist.

Inland %arine
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Inland marine insurance pays for loss or damages to portable property, other than vehicles, owned by a business. Items covered vary with the type of businesses.

ther #ommercial !ines

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+ther types of commercial insurance include professional liability, errors and omissions, and wor&ers' compensation.