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Insurance
Principles of insuranceIndemnificationInsurer’s business modelHistory of insuranceTypes of insuranceHealthDisabilityCasualtyLife PropertyLiabilityCreditOther typesInsurance financing vehiclesInsurance companiesGlobal insurance industryInsurance insulates too muchClosed community self insuranceComplexity of insurance policy contractsRedliningInsurance patentsThe insurance industry and rent seekingCriticism of insurance companies
Principles of insuranceIndemnificationInsurer’s business modelHistory of insuranceTypes of insuranceHealthDisabilityCasualtyLife PropertyLiabilityCreditOther typesInsurance financing vehiclesInsurance companiesGlobal insurance industryInsurance insulates too muchClosed community self insuranceComplexity of insurance policy contractsRedliningInsurance patentsThe insurance industry and rent seekingCriticism of insurance companies
Complexity of insurance policy contracts
Insurance policies can be complex and some policyholders may not understand all the fees and coverages included in a policy. As a result, people may buy policies on unfavorable terms. In response to these issues, many countries have enacted detailed statutory and regulatory regimes governing every aspect of the insurance business, including minimum standards for policies and the ways in which they may be advertised and sold.Many institutional insurance purchasers buy insurance through an insurance broker. Brokers represent the buyer (not the insurance company), and typically counsel the buyer on appropriate coverages, policy limitations. A broker generally holds contracts with many insurers, thereby allowing the broker to "shop" the market for the best rates and coverage possible.
Insurance may also be purchased through an agent. Unlike a broker, who represents the policyholder, an agent represents the insurance company from whom the policyholder buys. An agent can represent more than one company.