What are the types of insurance?

What are the types of insurance?

Does insurance mean insurance, the cornerstone of financial planning in which you, your dependents, and your property are protected from financial loss due to any untoward event or circumstance in the future, through this blog post we will discuss in detail insurance How much is What are the types? Throw light on the spread of insurance.

The concept of insurance is very simple. You pay a fixed amount to the insurer which is called the premium. In lieu of this one provides coverage and pays a predetermined amount for future damages.

Friends, on the basis of your insurance coverage, insurance is divided into life insurance and general insurance. Through our article, you will be told in detail about both these types of insurance and their various aspects. Hope you will definitely read our post from beginning to end.

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Here in this article, every question related to insurance has been explained in detail like –

Bima ke prakar or Insurance ke prakar
Whole life insurance, term insurance kya hai
Life insurance types OR life insurance kitne prakar ke hote hai
Health insurance kya hai, Insurance ke prakar, health insurance definition

What is life insurance?

Life insurance is one of the most important financial tools that can help your family to remain financially independent, clear liabilities taken in the form of debt, maintain a lifestyle, and keep important life goals on the right track. Is. Helps at a high level.

In life insurance, in case of premature death of the policyholder within the policy term, the insurance company pays the sum assured to the nominee’s family.

1. Whole Life Insurance –

It is a type of insurance plan. Which provides protection for your whole life. The term of the insurance policy for such plans is around 100 years. As long as the premium for such a policy is paid, the benefits of the policy remain intact. If one wants to continue with this insurance plan for life, then taking a whole life insurance plan is a very good option.

2. Term Life Insurance –

Term life insurance is a pure protection plan that offers a lot of coverage at an affordable premium. In term insurance, the sum assured is paid by the insurance company in case of death of the insured within the stipulated term of the policy. The sum assured received helps the insured’s family to meet their daily expenses and pay off the loan. Term plans allow choosing a sum assured of 15-20 times the annual income.

3. Endowment Scheme –

An endowment plan is an investment and a plan of insurance in a single product to cover life as well as work towards essential life goals. In this plan, a certain part of the premium goes as Sum Assured, while the rest is invested in a less risky avenue i.e. a business.

In case of death of the insurer during the term of the insurance policy, the nominee of the insurer receives the sum assured. This endowment plan caters to both the insurance and investment needs simultaneously.

4. Money-Back Policy –

In this plan a fixed sum of money is paid out at pre-determined intervals during the term of the insurance policy, the rest being insured with money-back policies or endowment plans. For example, if a money-back policy is taken for a term of 20 years, a certain amount can be paid at the end of the 5th, 10th, and 15th year of the policy term, and on the completion of this policy, the bonus is paid the entire profit.

5. Unit Linked Insurance Plan (ULIP) –

In this too, like endowment plans, a certain part of the premium goes towards providing life cover and the other part is invested in the markets to earn returns. These plans provide an opportunity to earn capital out of capital by investing in a single product and investing in insurance as well as life insurance and various types of risky funds.

A ULIP plan works like a money-back insurance plan, and also provides the facility of switching, i.e. investing from one fund to another.

What is general insurance?

Unlike life insurance, general insurance includes insurance for non-living property such as home, vehicle, health, travel, flood, fire, theft, road accident, and man-made calamities.

1. Home Insurance
2. Motor Insurance
3. Travel Insurance
4. Health Insurance

1. Home Insurance –

A home insurance policy protects your home and its contents from damage caused by humans and natural calamities. Friends, some home insurance policies give you coverage for temporary rent expenses during your home renovation.

2. Motor Insurance –

As the name suggests, this insurance is for vehicles, which provides you coverage in case of a vehicle accident, damage to the vehicle, theft of the vehicle, vandalism with the vehicle, etc.

There are two types of this insurance, third party and comprehensive, in which third party motor insurance takes care of third party damages in case someone gets into an accident due to your vehicle. As per the Motor Vehicles Act, 1988, it is mandatory for every vehicle plying on the road to have third-party insurance.

A comprehensive motor insurance policy, on the other hand, covers you from both third-party damages and your own damages, on damages caused due to flood, fire, riot, etc.

3. Travel Insurance –

If you are traveling abroad, a travel insurance policy covers you against loss due to loss of baggage, flight delays and trip cancellations. In some cases, if you are admitted to the hospital during the journey, due to travel insurance, you get the full treatment provided by the insurance company in the hospital.

4. Health Insurance –

Health insurance covers out-of-pocket expenses in case of medical emergencies. A health insurance plan is an indemnity plan that pays for hospitalization expenses.

The plan also includes a single insurance policy for the entire family, which provides coverage for the treatment of any member of the family. On the other hand, critical illness plans which are fixed benefit plans offer a larger amount for the diagnosis of a particular type of illness.

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