Insurance meaning in simple words


What is insurance?

                          Insurance meaning in simple words

Insurance is a way of reducing your potential financial loss or hardship. It can help cover the cost of
unexpected events such as theft, illness or property damage. It can also provide your loved
ones with a financial payment upon your death.

How does insurance work?

You pay a fee called a premium, and in exchange, the insu company agrees to pay you a certain
amount of money if the event you are insuring against is covered and happens during the term of
the policy.
The details of insu protection, such as exactly which events are covered and for how much, is
defined in your insurance policy. The insurance policy is a contract between you and the
company.

Why would I need insurance?

Insurance meaning in simple words

Insu can protect you and your loved ones from financial loss if something unexpected happens.

For example:

  •  Auto insurance could pay the cost of repairs to your vehicle if you have an accident.
  • Life insu could provide your family with money to support themselves when you die.
  • Home or tenant insu could pay for the cost to repair your home if there is a fire in your house, condominium or apartment.
The decision to get insurance will depend on your circumstances and your stage in life. For example,
you may want to consider getting life insu if you have a partner or if you decide to start a family.


However, if you are a single person with no dependents, life insu may not be as important toyou. Similarly, your provincial or territorial health plan may be enough to cover your basic medical
needs, but if you travel outside of Canada frequently, you may want to get travel health insurance.


There are many insu products available to cover different types of risks. Auto insurance is mandatory if you own a vehicle. Most other types of it's are optional. However, if you think that you cannot afford the potential financial loss or damage, then you should consider buying insurance.

This publication will provide you with a brief description of some of the most common types of
insurance, what is involved in getting insurance, and what to do if you need to make a complaint

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