by Belinda Whitaker

Created on: January 19, 2010

There are two general divisions of insurance. The first is Life and Health Insurance. This division of insurance includes policies that will cover you for medical bills, funeral expenses, and income replacement in the case of death or personal disability. The second is Property and Casualty. If you need coverage that doesn't fall under the spectrum of Life and Health, most likely it will fall under this division.

In a nutshell, Property Insurance covers all of your stuff. Your car, your house, your furniture, your motorcycle, etc., are just a few of the items you can buy Property Insurance to protect.

Casualty Insurance is also known as Liability Insurance. This type of insurance covers you for losses that you may, by accident, cause to another person. These losses may be to a person's property, as in a fender-bender, or injury to the person themselves.

Property and Casualty Insurance has coverages for both individuals and businesses. One of the most common personal policies is the homeowners policy. This policy combines both Property and Casualty coverages to give you a broad spectrum of protection. A good Homeowners policy will not only cover your home and furnishings, but also cover you for liability should someone be injured on your property.

For example, if your house were to burn down the Property side of your policy would pay to rebuild it. If your pesky neighbor trips over your son's forgotten skateboard on your front porch while coming to inform you that your dog just chased his cat up a tree, the Liability side would pay his medical bills.

Automobile policies can also co-mingle Property and Casualty coverages. You can choose to have only Casualty coverage for your automobile, if you fully own it. If you have an outstanding loan on the vehicle, the finance company will likely require you to carry the Property coverage as well.

The Property part of auto insurance includes the well known Comprehensive and Collision coverages. These will pay to have your car restored in the case of an accident. The Casualty part includes your BI or Bodily Injury and PD or Property Damage coverages. On the Casualty side, Property Damage refers to damages to the other person's car or property.

Property and Casualty insurance can also be purchased by businesses. Typical coverages include Business owners, Workers Compensation, Commercial General Liability, Commercial Property Insurance, etc.

A final note on Property Insurance: Property Insurance can be written on either a named peril basis, or open peril basis. With a named peril policy, your property is only covered for damages caused directly by the perils listed in your policy, such as fire. With an open peril policy, you are covered for damages caused by anything not specifically excluded in your policy, such as acts of war or riot. Be sure to read your policy and know what you are covered for.

A final note on Casualty Insurance: In this day and age, with lawsuits being filed for every slight known to man, it is important to be sure you have adequate Casualty Insurance. Remember, an insurance company will only pay up to its policy's limits. If your neighbor not only tripped over your son's skateboard, but rode it to the edge of your porch where he fell, not only breaking his leg and arm, but also hitting his head causing a concussion, loss of blood, and a week long hospital stay, would your policy limits cover the expenses?

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