Gban'S & You Banner Image

How many types of Insurance are there?

Hello Gnees Army,

Good Morning,

Before we jump over to the types of Insurance. Let’s know what is Insurance? In simple words, Insurance is nothing but protection from financial loss. It is a kind of risk management system, primarily used to protect against the risk of a sudden or uncertain loss.

An agency or organisation which provides insurance is known as an insurer or insurance company or insurance carrier or underwriter. A person who buys insurance is known as an insured or a policyholder. The insured receives a contract, called the insurance policy, which details the conditions and circumstances under which the insurer will/obliged to compensate the insured.

The amount of money charged by the insurer to the policyholder for the coverage declared in the insurance policy is called the premium. If the insured experiences a loss which is potentially covered by the insurance policy, the insured/policyholder can submit a claim to the insurer for compensation.

However, today we’re only discussing the types of insurance. Basically, Insurance is only two types – One is Life Insurance and Another is General Insurance. Except for Life Insurance, all other insurances are categorized in General Insurance. As there is no limit of types of General Insurance, there are thousands of insurances can be mentioned here. But as it’s not possible to discuss each and every insurance, in this article we’re only focusing on insurances that are widely popular or used across the world. So, Are you ready? Here we go …

 Life Insurance 

Life Insurance - Types of Insurance
Life Insurance – Types of Insurance

Life Insurance is different from other insurance in the sense that, here, the subject matter of the life of a human being. That’s why at present, life insurance enjoys a maximum advantage. In simple, Life insurance is a contract between one person and the issuer that offers financial compensation in case of death or disability of that person. Some life insurance policies even offer financial compensation after your retirement or expiry of a certain period of time (that is called Term in insurance).

Likewise, it helps you to secure your family’s financial security even in absence of you. You either make a huge payment while purchasing a whole life insurance policy (Whole Life Insurance) or make periodic instalments (Term Insurance) to the insurer. These are also known as premiums.

Highlights:

  • Family support absence of you: In exchange of money, your insurer promises to pay a guaranteed amount to your family in the event of your death, disability, or at a set time.
  • Surety: It’s important and gives surety to give an adequate amount at old age when our earning capacities are degraded.
  • Tax-free experience:¬†Life insurance also provides a little number of tax-free capabilities. Across the world, there are many countries, like the United States, India, UK, … the tax law provides that the interest on this, the cash value is not taxable under certain circumstances.

Thus, This benefits leads to the widespread use of life insurance as a tax-efficient method of saving as well as protection in the event of early death.

 Health Insurance 

Health Insurance - Types of Insurance
Health Insurance – Types of Insurance

Health insurance covers the cost of medical treatments of a person. It refers to a type of General Insurance and provides financial assistance to policyholders when they go for medical treatment. In most developed countries, all citizens receive some health coverage from their governments, paid through taxation. In Simple, this insurance compensates the amount you pay towards the treatment of any injury or illness.

Highlights:

  • Maternity cover: The costs related to childbirth. This includes pre-delivery check-ups, hospitalisation during delivery, and post-natal care.
  • Pre-existing diseases cover: Takes care of the treatment of diseases you may have before opting the insurance.
  • Accident cover: Pay for the medical treatment of injuries caused due to accidents or disasters. Medical bills prior to or post hospitalisation.
  • Cashless Claim¬†– If you ask treatment at one of the hospitals which have tie-ups with your insurance provider, you can avail cashless claim benefit. This feature ensures that all medical bills are directly compensated between your insurer and hospital.

Leave a Reply

Your email address will not be published. Required fields are marked *

Next Post

What are the types of group insurance?

Sun Nov 15 , 2020
Hello Gnees Army, Good Morning, Before we jump over to the types of group of insurance, let’s know what is group insurance? So, basically, Group insurance is a contract between the insurer and a group (it may be a company, organization, or something like that). Usually, term insurance plans are […]
Types of Group Insurance

You May Like