What are the types of insurance?

No-author | ET Online Update: 21 December 2020, 9:23 am
On taking health insurance, the insurance company covers the cost of treatment in case of illness.
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Insurance is an effective tool to deal with the possibility of future losses. We don’t know what will happen tomorrow, so we try to cover possible future losses through insurance policies.

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Insurance means protection against risk. If an insurance company insures a person, the insurance company will compensate the person for financial loss.

Similarly, if the insurance company covers the car, home

Or if the smartphone is insured, in case of breakage, breakage, damage to the item, the insurance company compensates its owner as per the pre-determined condition.

How many types of insurance are there?

There are generally two types of insurance:
Life insurance
General Insurance

In life insurance, the life of a person is insured.
Life Insurance: Life insurance means that on the death of the person who purchased the insurance policy, his dependents get compensation from the insurance company.

If the head of the family dies prematurely, it becomes difficult to run the household expenses. A life insurance policy is necessary to protect the spouse/children/parents etc. of the head of the family from financial crisis. In financial planning, the first thing one is advised to do is buy a life insurance policy.

General insurance includes all vehicles, houses, animals, crops, health insurance etc.
Home Insurance: If you insure your home with a general insurance company, your home is covered. After purchasing an insurance policy, if your home suffers any kind of damage, the insurance company pays the damages.

Motor Insurance

In India, it is very important to insure any vehicle plying on the road as per the law. If you drive on the road without insuring your vehicle, the traffic police can fine you. According to the motor or vehicle insurance policy, the insurance company compensates for any damage caused to the vehicle. If your vehicle is stolen or causes an accident, a vehicle insurance policy can help you a lot.

You get the most benefit from a vehicle insurance policy when someone is injured or killed because of your vehicle. It is covered under third party insurance. If you have a two wheeler/three wheeler or even a car, it must be insured.

Health insurance

Nowadays the cost of treatment is increasing very fast. On taking health insurance, the insurance company covers the cost of treatment in case of illness. Under a health insurance policy, the insurance company pays the amount spent on the treatment of any type of illness. Expenditure limit on any illness depends on your health insurance policy.

Travel Insurance

Travel insurance protects against loss during a trip. If a person goes abroad for work or travel and gets injured or loses luggage, the insurance company compensates him. A travel insurance policy is valid from the start of your journey to the end of your journey. Different insurance companies may have different conditions for travel insurance policies.

Crop insurance

As per the current rules, every farmer who has taken an agricultural loan is required to purchase crop insurance. Under a crop insurance policy, the insurance company compensates the farmer in case of any damage to the crop. Under a crop insurance policy, compensation is provided by the insurance company in case of crop failure due to fire, flood or any disease.

Farmers are not very enthusiastic about crop insurance due to strict conditions of crop insurance policies and non-reimbursement as per cost. In fact, to provide compensation in case of crop failure, insurance companies survey all the fields around that farm and most farmers are compensated only when their crops are damaged.

Business liability insurance

Liability insurance is actually meant to cover the loss caused to the customer by the company or any product work. In such a situation, the entire cost of fines and legal proceedings against the company has to be borne by the liability insurance company.

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What are the types of insurance?

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