Did you know that the insurance industry provides coverage for natural disasters, terrorism, pandemics and even liability for creepy crawlers? Did you know that insurance has been around for almost 5,000 years? And did you know that there are over 300 different types of insurance available to individuals and businesses today? The insurance industry is vast, complex and dynamic. The market is constantly evolving with new players emerging, while others fade away. Given its reputation as being a staid sector filled with old school companies, it’s surprising how much there is to know about insurance. So here are 10 interesting facts about insurance that you might not have known.
You Might Not Know About Insurance
1) Insurance has been around for 5,000 years
Insurance traces its origins back to ancient China where farmers would form groups and pool their funds to pay for their losses caused by natural disasters. In the 16th century, the British government created the Marine Society to pool funds and provide financial assistance to sailors who were injured or lost their ships at sea. The concept of insurance has been around for thousands of years and has always been about risk management and providing peace of mind to individuals and businesses.
2) Terrorism insurance is one of the fastest growing types of insurance today
There are two types of insurance that are primarily used to cover losses due to terrorism. The first is general commercial terrorism insurance, which is purchased by businesses. The second is an extension of commercial general liability insurance, which is purchased by individuals and companies. Commercial general liability insurance extends the coverage of commercial property and casualty insurance to acts of terrorism. The cost of terrorism insurance has grown substantially since 9/11, while other types of insurance have seen their premiums decline. This has led to an explosion in growth of terrorism insurance coverage. In 2018, the global terrorism insurance market grew to $45 billion in premium, which was a threefold increase from the $15 billion in premium written in 2001.
3) There are over 300 different types of insurance available today
The insurance industry is a complex ecosystem with hundreds of companies and thousands of types of insurance policies. Auto insurance, homeowners insurance and health insurance are just a few of the most common types. Each type of insurance is designed to protect against different types of risks. For example, homeowners insurance provides coverage for natural disasters, terrorism and fire risks, while auto insurance covers liability for bodily injury and property damage. In addition to standard policies, there are a number of specialized policies designed to protect against unusual risks. Animal liability insurance is designed to cover the cost of damage caused by a vicious animal owned by the policy holder, while medical malpractice insurance protects healthcare professionals if they are successfully sued by a patient.
4) You don’t need to own a car to have auto insurance
While most people think of auto insurance as something that is required if you own a car, this isn’t actually true. A significant portion of the population doesn’t own a car and yet still has auto insurance. In fact, almost 20% of people that don’t own a car have auto insurance, but don’t drive. They are referred to as “non-operators” and make up a large percentage of the auto insurance market. Auto insurance is primarily designed to protect other people from the financial consequences of your actions. It’s designed to protect you from the financial consequences of the poor driving of other people. For example, if another person crashes into your car and causes $10,000 in damage, it’s likely that your policy will pay for the repairs to your car.
5) All licensed drivers are required to have auto liability insurance
Every state in the US has its own insurance laws, but one thing they all have in common is that all licensed drivers are required to have auto liability insurance. The minimum amount of coverage varies by state and is referred to as the “liability requirement.” Insurance companies typically raise the cost of your policy the more miles you drive, while the type of vehicle you drive also impacts your premium. Some states also have “no-fault” laws that require policy holders to have certain amounts of insurance coverage. These laws are designed to reduce the number of traffic accidents. Auto insurance companies use a variety of factors to determine the premiums they charge, including your age and gender, the type of car you drive and the number of miles you drive each year.
6) 90% of identity theft is committed by people you know and trust.
Identity theft is often perceived as a crime committed by a stranger on a subway or online. In fact, almost 90% of all identity thefts are committed by people you know and trust. This could be your family members, friends and even employees. The most common way that people commit identity theft is by misusing a person’s personally identifiable information, such as their name, address, Social Security number or bank account information. This information can be obtained through a variety of methods including hacking, stealing a purse or wallet, or even rummaging through your garbage. Identity theft can have a devastating effect on your credit score and financial future. It can take years to repair your credit score if you become a victim.
7) A pandemic is a disease that spreads rapidly across a large region.
A pandemic is a widespread outbreak of an infectious disease that has increased severity and is difficult to control. The World Health Organization uses a mathematical model to determine the level of risk for pandemics. The higher the level of risk, the more likely it is that a pandemic will occur. When a pandemic occurs, it often has a significant effect on the insurance industry. Insurance companies will often cancel or temporarily halt coverage for certain types of policies, such as travel insurance, to try and control the spread of disease.
8) Natural disasters can cause massive destruction and loss of life
Natural disasters are unpredictable and can occur anywhere and at any time. While the weather is something that we can’t control, there are a number of precautions that you can take to reduce the risk of experiencing a natural disaster. Checking the weather forecast, securing your home and contents, and having appropriate insurance in place are some basic steps you can take to protect yourself from a natural disaster. While natural disasters can be triggered by a wide range of factors, including weather patterns and climate change, there are a few types that are particularly common. Flooding is one of the most common natural disasters, with hurricanes and tropical storms also posing a significant threat. Wildfires and tornadoes are also common natural disasters, with wildfires having been particularly devastating in recent years.
These are just a few of the more interesting facts about insurance. The insurance industry is vast, complex and dynamic. The market is constantly evolving with new players emerging, while others fade away. Given its reputation as being a staid sector filled with old school companies, it’s surprising how much there is to know about insurance. In order to make sure that you have the right coverage, it’s important to understand the different types of policies available, as well as the ways in which the industry works. If you ever have a question or concern, it’s important to talk to your insurance agent.