Understanding Insurance Plans

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The insurance industry is a large and complicated one, and one area where this is apparent is in the number of specialized insurance plans on the market. For example, homeowners insurance is different from renters insurance, and an insurance policy for your motorcycle is different from one for your car. Despite the many differences between these insurance plans, they all have certain key things in common, and in this article, our team at Morco Insurance Agency will go over some of these commonalities to help you understand them better.

Understanding Insurance Plans

• Premiums – All insurance plans charge a monthly fee for their coverage, which is known as a premium. You pay to enroll in their service, and as long as you keep paying, you can file claims and get damages covered when something goes wrong.

• Deductible – Many insurance plans also have what’s called a deductible, or an amount you’ll have to pay out of pocket before your coverage kicks in. For example, if your health insurance plan has a deductible of $2,000, you will need to pay the first $2,000 worth of services yourself before your insurance starts to cover the costs of treatment with you according to the stipulations laid out in your plan.

• Period – Insurance plans are generally valid for a limited time period, after which you will either need to renew the plan or find another provider. For example, most car insurance companies offer plans with six-month or one-year periods, meaning you will need to renew your coverage once or twice a year.