What Is Property and Casualty Insurance? - Nationwide (2024)

FAQs

What is the property and casualty insurance? ›

Property and casualty (P&C) insurers are companies that provide coverage on assets, as well as liability insurance for accidents, injuries, and damage to others or their belongings. P&C insurers cover a number of things, including auto insurance, home insurance, marine insurance, and professional liability insurance.

Property and casualty insurance, commonly referred to as P&C insurance, is a broad term that refers to various types of insurance. In simple terms, it's insurance coverage that helps protect your assets, including the property you own.

What Is Casualty Insurance? Casualty insurance is a broad category of insurance coverage for individuals, employers, and businesses against loss of property, damage, or other liabilities. Casualty insurance includes vehicle insurance, liability insurance, and theft insurance.

Without P&C insurance, individuals and businesses could face significant financial hardship in the event of an unexpected loss. For example, if a home is destroyed by a natural disaster and the homeowner does not have insurance, they would have to pay for the repairs or replacement out of pocket.

Property insurance covers all of your possessions - including home, auto, jewelry, art, furniture and other valuables. Casualty insurance covers you and others in the instance of a catastrophic event - like a bodily injury to yourself or others if you are deemed legally responsible for the event.

Insurance companies earn a profit by charging their customer premiums for buying insurance policies. However, insurers also earn income by investing the premiums received in various products, including U.S. Treasuries and corporate bonds.

Key Takeaways

The three types of property insurance coverage are replacement cost, actual cash value, and extended replacement costs.

If you're responsible for someone else's property damage or bodily injuries, the casualty insurance portion of your policy compensates the person making the claim against you. It also covers your legal fees, court costs and settlements if you get sued.

A casualty occurs when your property is damaged as a result of a disaster such as a storm, fire, car accident, or similar event. A theft occurs when someone steals your property. A loss on deposits occurs when your financial institution becomes insolvent or bankrupt.

Common types of insurance hazards

Hazards are commonly broken out into three main groups — physical hazards, moral hazards, and morale hazards — but physical hazards are what insurance inspectors are looking for when they assess your property.

What is the main purpose of property insurance? ›

Homeowner's insurance pays for losses and damage to your property if something unexpected happens, like a fire or burglary. When you have a mortgage, your lender wants to make sure your property is protected by insurance. That's why lenders generally require proof that you have homeowner's insurance.

For instance, life insurance covers the expenses associated with death (funeral and burial, lost income support for dependents, etc.) while P&C insurance focuses on damage to/loss of property or someone determined to have caused a loss of/damage to property.

Managing General Agents (MGA) help insurers and reinsurers to grow their businesses and expand into new markets. MGAs are not insurance companies yet they do some of the work of insurance companies. They are intermediaries yet they are not insurance brokers, rather, they support insurance brokers.

Primary and noncontributory endorsem*nts or policy language make a specific insurance policy primary, meaning, to go first, and noncontributory, meaning, without contribution, over other insurance policies of a specific party; this party is typically an additional insured.

- 'P&C', is most associated with property and casualty, and a few unrelated business terms.

The two major lines of property-casualty insurance are property insurance (insurance coverage related to the loss of real and personal property) and casualty—or perhaps more accurately, liability (insurance coverage that offers protection against legal liability exposures).