Types of Insurance

172

Any unforeseen situation in life can hinder the well being of your family. For such scenarios, there are a variety of life, health and general insurance policies available in India that provide comprehensive financial protection to your loved ones and yourself. Also, you can opt for an insurance cover to protect your property and assets. However, before buying an insurance policy, it is imperative to understand the different types of insurance policies and then choose an insurance policy that suits your needs.

Insurance Types You Should Know
Insurance is a legal agreement between an individual and an insurance company, whereby the insurer promises to provide financial coverage (sum insured) against contingencies for an amount (premium). The types of insurance in India can be broadly divided into two categories:

  • General Insurance
  • Life Insurance

Different types of insurance policies available in India

Following are the types of insurance available in India:

1. General Insurance

Following are some of the types of general insurance available in India:

  • Health Insurance
  • Motor Insurance
  • Home Insurance
  • Fire Insurance
  • Travel Insurance 

2. Life Insurance

There are various types of life insurance. Following are the most common types of life insurance plans available in India:

  • Term Life Insurance
  • Whole Life Insurance
  • Endowment Plans
  • Unit-Linked Insurance Plans
  • Child Plans
  • Pension Plans

Let us look closely at the different types of insurance policies:

general Insurance

General insurance policies are one of the types of insurance that provide coverage in the form of sum insured against losses other than the death of the policyholder. Overall, general insurance includes various types of insurance policies that provide financial protection against damages caused by bike, car, house, health and similar liabilities. These different general insurance types of insurance policies include:

health insurance

Health insurance is a type of insurance policy that covers expenses incurred due to medical care. Health insurance plans pay or reimburse the amount paid for the treatment of illness or injury. Different types of insurance policies cover different medical care expenses.

It usually provides protection against:

a) hospitalized

b) treatment of serious diseases

c) Medical bills after hospitalization

d) Daycare Procedures

There are some types of health insurance plans that also cover the cost of resident treatment and pre-hospitalization expenses. The rising cost of health care in India is making health insurance a necessity. The different types of health insurance plans available in India include:

1) Individual health insurance: Provides coverage to only one person

2) Family floater insurance: Allows your entire family to get coverage under a single plan, which usually includes husband, wife, two children.

3) Critical illness cover: Special type of health insurance that provides coverage against various life-threatening diseases like stroke, heart attack, kidney failure, cancer etc. The policyholders get a lump sum amount on diagnosis of critical illness.

4) Senior Citizen Health Insurance: This type of insurance plan caters to all persons above 60 years of age

5) Group Health Insurance: Provided by the employer to his employee

6) Maternity Health Insurance: This insurance type covers medical expenses for the antenatal, postpartum and delivery stages, providing protection to both the mother and the newborn.

7) Personal Accident Insurance: These types of insurance plans cover financial liabilities arising due to accidental injuries, disability or death

motor insurance

Motor insurance is a type of insurance that provides financial assistance in case your bike or car is involved in an accident. The different types of motor insurance policies in India include:

1) Car Insurance: Individually owned four wheelers are covered under this plan. Car insurance types include third-party insurance and comprehensive cover policies.

2) Bike Insurance: These are the types of insurance policies where personally owned two wheelers are covered against accidents

3) Commercial Vehicle Insurance: It is one of the insurance types, which provides coverage to any vehicle used for commercial purposes

home insurance

As the name suggests, a home insurance policy provides comprehensive protection to the contents and structure of your home against any physical destruction or damage. In other words, this insurance type will provide coverage against any natural and man-made calamity, such as fire, earthquake, tornado, theft and robbery.

The different types of home insurance policies include:

1) Home Structure / Building Insurance – Covers the damage caused to the house structure during any calamity

2) Public Liability Coverage – Provides coverage against any damage to a guest or third party on the insured residential property

3) Standard fire and special hazard policy – fire outbreaks, natural disasters (eg, landslides, rockslides, earthquakes, storms and floods), and antisocial man-made activities (eg, explosions, strikes and riots)

4) Personal Accident – Provides financial coverage to you and your family against any type of permanent dismemberment or accidental death of the Life Assured, anywhere in the world.

5) Theft and Theft Insurance – Provides compensation for stolen goods in case of theft or theft

6) Contents Insurance – Provides compensation for damage to furniture, vehicles, and other equipment in case of fire, theft, flood, or riots

7) Renters Insurance – Provides you (as a tenant) financial protection against any damage to the personal property residing in the rented house

8) Landlords Insurance – Provides you (as a landlord) coverage against contingencies like public liability and rent loss

Fire Insurance

Fire insurance policies are different types of insurance coverages that compensate any losses incurred due to a fire breakout with a sum assured. These types of insurance policy usually provide a significant amount of coverage to help both individuals and companies to reopen their places after incurring extensive damage due to fire. These insurance types cover war risk, turmoil, riots losses as well.

Different types of fire insurance in India are –

1) Valued policy

2) Specific Policy

3) Floating Policy

4) Consequential Policy

5) Replacement Policy

6) Comprehensive Fire insurance policy

travel insurance
As the name suggests, travel insurance is a type of insurance policy that provides financial protection to you and your loved ones while traveling to any place in India or abroad. Whether you are traveling alone or with your loved ones, travel insurance coverage will help ensure that your trip is a peaceful one.

Travel insurance policy coverage takes care of any problems that arise during your travels such as loss of baggage, flight cancellations, loss of passport, personal and medical emergencies. The different types of travel insurance policies include:

1) Domestic Travel Insurance: Within the Country

2) International Travel Insurance: For any travel or holidays outside India

3) Individual Travel Insurance: If you are traveling alone

4) Student Travel Insurance: If you are going abroad for further studies

5) Senior Citizen Travel Insurance: For Senior Citizens, whose age is between 60 to 70 years

6) Family Travel Insurance: For any family vacations

life insurance

Life insurance plans provide coverage against unfortunate events like death or disability of the policyholder. Apart from financial protection, there are different types of life insurance policies that allow policyholders to maximize their savings through regular contributions to various equity and debt fund options.

You can choose a life insurance policy to secure the financial future of your family from the uncertainties of life. Policy coverage covers a large amount, which is payable to your loved ones if anything happens to you. With this type of insurance, you have the flexibility to choose the term of the life insurance policy, coverage amount and payment options based on the financial needs. The different types of life insurance policies are as follows:

  • Term Life Insurance
  • Whole Life Insurance
  • Endowment Plans
  • Unit-Linked Insurance Plans
  • Child Plans
  • Pension Plans