Insurance is a product that provides financial protection against damages that may be incurred. There are many types of insurance products available. Homeowners insurance protects a homeowner against damage sustained on their property. If someone gets hurt while playing in the yard, their policy will help pay for the medical bills. If the roof collapses, the policy helps pay for a new roof. Private mortgage insurance ensures that a homeowner will be able to pay homeowners insurance in a timely fashion. This policy typically must be purchased by anyone who does not make a down payment of at least 20 percent of the purchase price of their home. Policyholders pay a monthly premium in exchange for this protection. The premium is determined by a host of factors. Generally, the amount of money that it would cost to insure a policyholder is the biggest factor that comes into play.