4 steps of the insurance process

January 16th, 2015 by admin

For first time buyers or those just starting the process, insurance may seem daunting and difficult to navigate by yourself. But when you simplify it, the insurance process can be separated into four steps, outlined by the Insurance Bureau of Canada (IBC)

4 Steps in the Insurance Process:

  • Your insurance company estimates an annual cost or premium that takes into account the risk of covering your home, business or car. Providers calculate premiums based on how much they expect they will need to pay for the coming year's claims.
  • For assuming this risk on your behalf, you, in exchange, pay a monthly or annual premium to your insurer. 
  • Your provider puts all of the premiums into one large pool, which will operate for a duration of one year. 
  • Your insurer uses the pool to pay for the losses of those who make claims that year.

What does insurance cover?

As the IBC explains, insurance covers losses outlined in your contract, and its main goal is to help you with the financial fallout from events you could not predict. The IBC expands on this, stating: "Insurance is generally intended – and priced accordingly – to help you cope with the financial consequences of unpredictable events that are sudden and accidental."

If you live in Saint John and need auto or home insurance, Fundy Mutual is here to assist you. We offer competitive home and auto insurance rates. Headquartered in Sussex, New Brunswick, we have been serving the insurance needs of New Brunswickers for over 70 years. Contact us for an affordable car insurance quote