What is personal insurance and how does it work?

Besides insuring your car, home or business, you can also insure yourself personally. We have identified four types of personal insurances that will protect you and your business if something happens to you.

  • Trauma protection – if you suffer any trauma, there’s an insurance policy which will cover costs for therapists and psychologists.
  • Income protection insurance – this protects you over the loss of personal income if you are unable to work due to an injury, illness or permanently crippled
  • Term life insurance – this will give you lump sum benefit if you become terminally ill or die. You can also add Total and permanent disablement (TPD) on top of your existing policy.
  • Business expenses –if you are sick and unable to work, your insurer will protect your wages and leases for a period of time.

Common misunderstandings of insurances

  • Replacement policy

People tend to misunderstand the insurance policies. If there’s something you don’t understand, ask your insurer to explain to you what is expected of you. A replacement policy is an insurance policy that strives to restore or rebuild property as new. Communicate with your insurer so that you don’t get under-insured or pay higher than normal.

  • Flood cover definitions

Flood cover policies often confuse people. Many insurance companies don’t cover damages caused by the following to your property.

  • Water flowing from a natural ditch
  • Overflow of water coming from natural waterway
  • Earth movement caused by water from a typhoon

Consult your insurance company and find out what your business is covered for.

Image Courtesy: royalunion.co.za

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