A loan agreement is a formal contract that defines the amount borrowed, the interest rate, repayment schedule, collateral (if any), and the consequences of default. It sets clear expectations for both the lender and the borrower, providing legal protection in case of disputes. Whether the loan is personal, business-related, or for real estate, a written … Read more
A Contract of Adhesion (also known as a standard-form contract) is drafted entirely by one party—usually a business—with stronger bargaining power. The other party, typically a consumer, must either accept or reject the contract as it is, without the opportunity to propose changes. Key Characteristics: Examples of Contract of Adhesion Here are some common real-life … Read more
Co-insurance is a key term you will often find in health insurance, property insurance, and other types of coverage. It’s essential to understand what co-insurance means so you can make better decisions when choosing your policy and calculating your out-of-pocket costs. Definition of Co-Insurance Co-insurance is the percentage of the cost of a covered service … Read more
Profit sharing is a type of incentive plan in which companies share a portion of their profits with their employees. Unlike a fixed bonus or salary, the amount shared depends on the company’s profitability. It is typically paid out annually and can be distributed in cash or contributed to employee retirement accounts. Profit sharing motivates … Read more
A balloon payment is a financial term referring to the final payment of a loan that is significantly larger than the previous installments. It is usually found in loans that do not fully amortize over their term. For example, if you take out a five-year loan with low monthly payments based on a 30-year amortization … Read more
An Indemnity Plan is a traditional health insurance model that reimburses the insured for medical expenses up to a certain limit. Unlike managed care plans like HMOs or PPOs, indemnity plans give you the freedom to choose any doctor, specialist, or hospital without requiring referrals. Instead of paying your medical provider directly, the insurer reimburses … Read more
Wage garnishment is a legal procedure in which a portion of an individual’s earnings is withheld by their employer to repay a debt. It typically occurs when a court or government agency issues an order requiring the employer to deduct a specific amount from an employee’s pay check. The withheld money is sent directly to … Read more
Comprehensive coverage, also known as “other than collision” coverage, pays for the repair or replacement of your car if it’s damaged by events that don’t involve a crash. This includes: It typically comes with a deductible, which is the amount you pay out-of-pocket before your insurance kicks in. What Does Comprehensive Insurance Cover? Here’s a … Read more
Group insurance is a type of insurance policy that covers a defined group of people, usually employees of a company, members of a society, association, or professional group. This policy is usually purchased by an employer or organization, and coverage is extended to all eligible members. Key Features of Group Insurance Types of Group Insurance … Read more
Motor insurance is a contract between the vehicle owner and the insurance company that provides financial coverage for damages to the insured vehicle, third-party property, and bodily injuries. It is mandatory by law in many countries, including India and the U.S., to have at least third-party liability insurance for any vehicle on the road. Types … Read more