Insurance is a protector that protects us from various risks and uncertainties and helps us financially to overcome the financial baggage that such incidents can impose. In India, Insurance companies provide different types of insurance as per people’s needs like for personal use, business, or organization. To choose the best Insurance plan, it is important to have a deep knowledge of the different types of insurance available in India.
There are majorly two types of insurance in India and they are further categorized in subparts. Two types of insurance are:
- Life Insurance
- General Insurance
Further, these are sub-categorized as follows:
| Life Insurance | General Insurance |
| 1. Pension Plan 2. Term Insurance 3. Whole Life Insurance 4. Child Plans 5. Money Back Policy 6. Unit Linked Insurance Plan | 1. Property Insurance 2. Health Insurance 3. Commercial Insurance 4. Motor Insurance 5. Travel Insurance 6. Asset Insurance |
Let us know about all these in detail
1. Life Insurance: Life Insurance provides financial protection to people in case of death. It mainly focuses on your family in case of your demise. Your family can be financially secured with life insurance. It helps in covering various expenses like debts, living expenses, and funeral costs.
Pension Plan: After a certain age you need to enjoy your life and that can be done if you are financially secure. After retirement, there are certain Insurance plans that help you financially.
Term Insurance: It is a type of life insurance that provides coverage for a certain period or term. For example, if a person bought a term insurance and he/she dies within the term policy then all the benefits /money of that insurance will be given to his/her family. But if the person is alive after the policy period ends then he/she will not get any benefit from that insurance policy.
Whole Life Insurance: This type of insurance is meant for your whole life until the premiums are paid. You get a lifelong protection and saving component called cash value.
Child Plans: This insurance helps you in safeguarding your children’s future. This can help your children in the future when the insurance is matured. It can also help them financially for their education, wedding, etc.
Money Back Policy: It is a type of insurance in which life insurance protection is combined with periodic payouts. A money-back policy is different from traditional life insurance policies in that it pays out regularly at predetermined intervals throughout the policy term, as opposed to only paying out a lump sum benefit upon the policyholder’s death. These payouts are based on a predetermined percentage of the sum assured and are given at predetermined stages, like every 5 or 10 years.
Unit Linked Insurance Plan: It provides the dual benefit of life insurance with an option to invest in market-linked instruments, such as individual stocks and bonds. The premium can be divided to provide either life cover or investment options that are related to the market. The policyholder can choose from various funds linked to his policy, and one can switch between different funds under his investment priorities or risk.
2. General Insurance: It is that type of insurance that helps you when your property is damaged, unlike life insurance. General insurance is also known as non-life insurance and it helps in case of accidents, long-term health issues, etc.
Property Insurance: Property insurance helps you when your property is damaged by any other person, by you, or by any natural calamity. The property can include any property owned by you like your house, office, commercial premises, etc. It majorly covers when your property is damaged by fire, vandalism, burglary, theft, or natural calamity.
Health Insurance: This type of insurance covers your health issues and helps you financially with hospital bills. It covers hospitalization bills, surgery, medication, and preventive care and relieves the financial burden set by healthcare services.
Commercial Insurance: If you own a business, then this insurance will help you as it looks after your business against various types of risks, including property damage, liability claims, as well as employee-induced issues.
Motor Insurance: It provides financial loss coverage for damage and theft of vehicles, as well as claims from third-party liability on injury and damages caused by the accident. It includes coverage for third-party liability and own damage in a single policy.
Travel Insurance: This takes care of anything unplanned while traveling, like canceling trips, loss of luggage, and medical situations away from one’s home area. It covers the travelers from different risks and expenses that can occur on their trip.
Asset Insurance: This insurance covers valuable items, whether in the form of an art collection, jewelry, or any high-value equipment, against risks such as theft, damage, or loss. It provides financial compensation for repairs, replacements, or the amount due on account of loss relating to the concerned assets.
