Types of Insurance
The world is full of risks. All kinds of risk. Something could go wrong even when you are just sleeping in your bed. Or standing at your balcony. Or hunting for your next meal. It is a world of risks – left, write and centre.
That is where Insurance comes in, and Why Insurance is Important.
Insurance helps us mitigate these risks – to some extent. You do not want to be on your own, all along, every time you face some risks.
Generally, there are 2 main types of insurance:
1. General Insurance
2. Life Insurance
A general insurance is a policy or plan that offers financial compensation on any loss other than death. It insures everything apart from life. A general insurance compensates you for financial losses that may come incidents happening to your health, your vehicles, your travel plans etc, etc. The insurance company makes a promise to pay you a sum assured to cover damages to your vehicle, medical treatments to your health problems. The policy covers other things like losses due to theft or fire.
General Insurance if further divided into many categories. Some of the most common sub-categories that fall under general insurance are :
Health Insurance
Motor Insurance
Fire Insurance
Home Insurance
On the other hand, Life Insurance is a plan that offers financial compensation in case of death or disability. Some life insurance policies even offer financial compensation after retirement or a certain period of time.
The main purpose of life insurance is to give the policyholder’s loved ones financial security after the policyholder passes away. This can assist in paying for expenses, including funeral bills, unpaid debts, and ongoing living expenses.
Under life insurance plans, we have policies like:
Whole Life Insurance
Term Life Insurance
Disability Insurance
Pension Plans
Endowment Plans
Money-back Plans
Child /Education Policy
Summary
When you are looking for an insurance company, you should also consider the customer service record of the company. You can check the Better Business Bureau to see if there are any complaints against the company.
When you buy insurance, you should also keep in mind that you are buying a contract. You should read the policy carefully to make sure you understand the coverage. If you have any questions, you should contact the insurance company.
