Introduction:
In today’s world, the average cost of living is increasing at a higher pace, along with the cost of other essential stuff in life. Going with an insurance policy can offer you financial help, which can ease some troubles in your time of need. The range of insurance types offered in India is wide and in this article, we will explain the common ones that will help solidify your understanding.
What is Insurance?
Insurance can be defined as a legal contract between an entity (the policyholder) and the insurance provider (the insurer). In this case, the insurer settles on an agreement to offer financial coverage/compensation to the insured against contingencies, in exchange for specified premium payments.
What are the Types of Insurance Offered in India?
Nowadays, you can get insurance for nearly anything. The sector of insurance is a widespread topic but can be separated into two broad categories, which are:
- Life Insurance
- General Insurance
What is Life Insurance?
Life insurance is a type of policy where the insurer offers financial coverage to the policy beneficiaries in case of the demise of the insured, within the policy period. It is a great option for individuals who want to secure their family’s future after they are gone. In case anything happens to you, a subsequent amount will be compensated to your beneficiaries under this plan. If you go with a life insurance policy, you have the choice over its policy period, payout method, and coverage amount in accordance with your requirements. Here are some examples of different types of life insurance available in India:
- Term life insurance plans
- Whole life insurance plans
- Unit-linked insurance plans
- Endowment plans
- Retirement plans
- Money back plans
- Child plans
What is General Insurance?
General insurance can be defined as a policy that covers our valuable assets. In this case, the insurer offers financial coverage or compensation to the insured party, against any incurred damages or losses. In other words, it includes the types of insurance contracts that don’t fall under the extent of life insurance. There are multiple types of general insurance you can get in India and here are some examples listed below:
- Health insurance
- Motor insurance
- Fire insurance
- Travel Insurance
- Home Insurance
How to Choose the Right Insurance?
The two most essential points to remember when buying insurance includes selecting the proper coverage and the right provider. There are lots of other factors that you should consider when selecting an insurance policy, some of which are:
- Premium amount
- Included benefits
- Accessibility
- Claim settlement ratio (CSR)
Conclusion:
When selecting an insurance policy, you must invest your time to read all its terms and conditions and compare other available options. This will help you curate the perfect policy that covers your needs and stays within your budget. Choosing the right insurance policy will offer you financial backup when required, along with the peace of mind.
