Personal Finance - Types of insurance

Question 1

Car

Answer 1

To cover both theft and accidents – there is a legal requirement to insure any car that is on the road
and this protects the driver, passengers and other road users.

Question 2

Home and contents

Answer 2

Home – covers the physical building against events like a fire or flood damage.
Contents – covers the physical items inside the house and when they are used away from home.

Question 3

Life assurance and insurance

Answer 3

Life assurance – an ongoing policy to pay a lump sum upon death.
Life insurance – a policy for a set period of time (e.g. mortgage term) to pay a lump sum if you die
within that period.

Question 4

Travel

Answer 4

Protects individuals or groups while abroad. Cover usually includes illness, loss or theft of property,
cancellation and emergencies up to predetermined limits.

Question 5

Pet

Answer 5

Protects the owners of pets against some or all of the expenses associated with treating an injured or
sick animal e.g. vet fees.

Question 6

Health

Answer 6

Covers individuals, families or employees against medical expenses including assessments, treatments
and loss of earnings. In the UK, this can pay for private treatment or payment plans for routine visits
e.g. to the dentist.