| Insurance is often undervalued, frequently because | | | | insurance can help to provide certainty in an uncertain |
| people have a narrow mind when it comes to the | | | | world. |
| insurance business as a whole. However, insurance | | | | All insurances are similar: |
| helps to give security to business dealings. Here is a | | | | Fire insurance is not terribly different from flood |
| look at how insurance can give your business security. | | | | insurance, and flood insurance is not any different than |
| Insurance is a swap: | | | | life insurance. To a certain extent, all insurances are |
| All types of insurance do one thing - they exchange a | | | | the same. If you work with life insurance, then you |
| small, certain payment for a large, uncertain loss. | | | | know that approximately 3.8% of people die before |
| Basically, this means that you pay a small fee and | | | | they are 25. This means that another 96.2% don't, but |
| fixed intervals (your premium), and the insurance | | | | you have no way of knowing which of the two |
| company will take the risk should any losses ever | | | | groups you will be in. All you can do is calculate your |
| occur. | | | | personal risk. The higher your risk, the higher your |
| Take, for instance, a flood. Floods are often destroying | | | | premium will be. |
| business property and inventory, but it is impossible to | | | | This is true of all types of insurance, including home |
| know when one will, if ever occur. If you were able to | | | | owner's insurance. Property owners never know how |
| tell when a flood would occur, you wouldn't need | | | | good their title is. A merchant doesn't know how much |
| homeowner insurance ( But because you can't, taking | | | | he will lose on a given debtor. However, when you |
| out a flood insurance policy can help you to replace | | | | look at a large enough group, you can get an idea of |
| the things that you lose when there is a flood. | | | | what your individual risk is. Everything you do in |
| Group statistics can be calculated: | | | | business has a certain risk to it. On your own, you |
| While you cannot tell what your chances of a flood, | | | | cannot determine what the risk is, but as a member of |
| fire, or other disaster will be, your business group as a | | | | a business group, you know what the statistics are for |
| whole has set statistics. For instance, if you own a | | | | that group. |
| bakery, your risk of having a fire destroy your | | | | What insurance does for your business: |
| business is higher than the risk of a fire taking down an | | | | Business has risk. There is the risk of losing property, |
| office building. Knowing that, you could decide that as a | | | | losing life or health of employees, or losing money, |
| bakery owner, your risk of having a fire is higher, and | | | | among others. What insurance does is give you some |
| you therefore need more insurance. If you are an | | | | guarantee against these losses. By knowing what your |
| office owner, you could decide that your risks are | | | | risk factor is, and insuring it appropriately, you will know |
| lower and that you need less insurance. Every | | | | that you have what you need sure an incident ever |
| business and every individual needs certainty, and | | | | occur. |