Know about Insurance in the United States

In insurance we have contract in which the insurer (stock insurance company, mutual insurance company, reciprocal, or Lloyd's syndicate, for example), agrees to compensate or indemnify another party (the insured, the policyholder or a beneficiary) for specified loss or damage to a specified thing (e.g., an item, property or life) from certain perils or risks in exchange for a premium.


 The first insurance company in the United States underwrote fire insurance and was formed in Charleston, South Carolina, in 1735. In 1752, Benjamin Franklin helped form a mutual insurance company called the Philadelphia Contributionship, which is the nation's oldest insurance carrier still in operation. Franklin's company was the first to make contributions toward fire prevention. Not only did his company warn against certain fire hazards, it refused to insure certain buildings where the risk of fire was too great, such as all wooden houses The first stock insurance company formed in the United States was the Insurance Company of North America in 1792.

Massachusetts enacted the first state law requiring insurance companies to maintain adequate reserves in 1837. Formal regulation of the insurance industry began in earnest when the first state commissioner of insurance was appointed in New Hampshire in 1851.

 In 1869, the State of New York appointed its own commissioner of insurance and created a state insurance department to move towards more comprehensive regulation of insurance at the state level.

Health Insurance Plans

Health insurance helps you pay for medical services and sometimes prescription drugs. Once you purchase insurance coverage, you and your health insurer each agree to pay a part of your medical expenses. These amounts are usually a certain dollar amount or percentage of the expense.You can have health care coverage through:

• a group coverage plan at your job or your spouse/partner's job
• your parents' insurance plan, if you are under 26 years old
• government programs such as Medicare, Medicaid, or Children's Health Insurance Program (CHIP)
• the Veteran's Administration  or TRICARE for military personnel
• your state, if it provides a health insurance plan
• a plan you purchase on your own directly from a health insurance company or through the Health Insurance Marketplace
• Continuing Employer coverage from your former employer, on a temporary basis under the Consolidated Omnibus Budget Reconciliation Act (COBRA)

Types of Health Insurance Plans

When purchasing health insurance, your choices typically fall into one of three categories:

• Traditional fee-for-service health insurance plans are usually the most expensive choice, but they offer you the most flexibility in choosing health care providers.
• Health maintenance organizations (HMOs) offer lower co-payments and cover the costs of more preventive care, but your choice of health care providers is limited.
• Preferred provider organizations (PPOs) offer lower co-payments like HMOs but give you more flexibility in selecting a provider.

Choosing a Health Insurance Plan

When choosing among different health care plans, you will need to read the fine print and ask a lot of questions, such as:

• Do I have the right to go to any doctor, hospital, clinic, or pharmacy I choose?
• Are specialists, such as eye doctors and dentists, covered?
• Does the plan cover special conditions or treatments such as pregnancy, psychiatric care, and physical therapy?
• Does the plan cover home care or nursing home care?
• Will the plan cover all medications my physician may prescribe?
• What are the deductibles? Are there any co-payments? Deductibles are the amount you must pay before your insurance company will pay a claim. These differ from co-payments, which are the amount of money you pay when you receive medical services or a prescription.
• What is the most I will have to pay out of my own pocket to cover expenses?
• If there is a dispute about a bill or service, how is it handled?