PF2 - Insurance Lesson

Insurance

When an insurance company or agent sells an insurance policy, the risk of loss transfers from the individual to the insurance company. Insurability refers to whether a client or risk can be insured. A popular example would be earthquake insurance in California; the probability of one occurring is so high that it presents too high a liability for the insurance company. Your insurance rates decrease based on your insurability. If you are too great a risk – your insurability is too low – you may be deemed uninsurable, meaning an insurance company will refuse to approve your policy.

Watch the following video on insurance and types of insurance. Be sure to review the key terms at the beginning of the unit for more information about some forms of insurance.

Insurance Video

What type of Insurance do You Need? Practice

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