stock insurance company, is a corporation with stockholders, a board of directors,
and officers who run the company on a daily basis. The second major type is the
mutual insurance company, a cooperative owned by its customers. Its owners are
the people insured. Profits, called dividends, are distributed to the owners each
year from investments made by the company. There are several types of insurance.
Life insurance is a protection usually for the family and relatives of a person after
death. Property insurance covers damages and losses to your own property.
Liability insurance, on the other hand, covers damages or losses to someone else or
to his or to her property that you may have caused accidentally. Health insurance
provides money to pay bills in case of accident or sickness. Federal agencies also
insure banks, saving and loan associations, and credit unions on their accounts.
When a bank fails, tremendous amounts of money are involved. The federal
government handles the social security program, which is income and retirement
insurance plan.
Insurance frees you from some of the worry you would face without that
protection.