Define Property & Casualty Insurance
Property and casualty insurance protects policyholders in the event of damage to their property or from liability that occurs on or in the use of their property. Property and casualty insurance is available for both business and personal property and can be purchased from insurance agents who are licensed to sell the products in a particular state. Property and casualty insurance may be mandatory in some cases, such as when state law requires minimum auto liability coverage.
Other People Are Reading
-
Significance
-
Without property and casualty insurance, home and business owners would be at financial risk in the event of perils such as theft, fire or vandalism. Automobile owners would be forced to pay for damages resulting from vehicle thefts or accidents out of their own pocket. Individuals would risk being financially ruined if they are sued due to causing an auto accident or being held liable for an injury that occurs on their property.
Types
-
Types of property and casualty insurance include commercial and personal lines. Commercial coverage pertains to a business and covers items such as business vehicles, the business property, general liability and capital assets. Personal coverage includes autos and homes that are owned individually. An umbrella policy can be purchased to provide additional liability protection in personal and commercial situations.
-
Features
-
Features of property and casualty insurance can include coverage for the policyholder's property and contents. In auto insurance, coverage is provided for the property of others in the event the policyholder is deemed to be at fault for an accident. A liability offers the insured protection in the event of a lawsuit. Some coverages, such as collision coverage for an automobile, require that the insured pay a deductible, which is subtracted from the amount of the insurance settlement.
Considerations
-
Things to consider when purchasing property and casualty insurance include the value of the property you are insuring, the value of your assets and how susceptible you may be to liability. In auto insurance, factors to consider include how far and how frequently you drive, the type of vehicle you drive and whether teenagers will be driving your vehicles.
Warning
-
Although you may be legally obligated to purchase only certain minimum coverages, this is usually not enough to provide adequate protection. For example, if your state only requires a minimum auto liability coverage of $30,000 but you own assets in excess of $500,000, your risk losing much of your property if you cause an accident that results in a high amount of damages.
-
References
- Photo Credit houses image by Gonçalo Carreira from Fotolia.com
