Types of Insurances
In life, unplanned spending is a painful fact. Even if you think you are financially safe, sudden or unexpected expenditures can seriously hamper such safety. Depending on the degree of emergency, these situations may also lead to a debt burden.
Although you cannot plan ahead for emergencies caused by such accidents, insurance policies provide the support that can reduce financial liability caused by accidents.
There are various insurance policies and different types of insurances are available, each designed to protect certain aspects of your health or assets.
Generally, there are 8 types of insurances:
Just knowing that different insurance policies will not help you, you should know how each plan works.
Without sufficient knowledge, you may not be able to protect your money and the financial situation of your family. Continue reading to understand all the information you need to know about various types of insurances:
1. Life Insurance
Life insurances are a types of insurances that refer to a policy or insurance that a policyholder can guarantee the financial freedom of his family members after death. Suppose you are the only member who can make money to support your family and raise your wife and children.
In this case, your death will cause financial loss to the entire family, and life insurance policies can ensure that financial assistance is provided to your family when you die to ensure that such things will not happen.
Types of life insurance policies
There are seven different types of life insurance policies:
Research plan-Research plan death benefits are only available for a specified period of time, for example, 40 years from the date of policy purchase.
Pension plan-A pension plan is a life insurance policy. Part of your insurance cost is for death compensation, and the insurance provider uses the rest for investment. Some of these aid policies are end grants, death grants, and fixed-term grants.
Unit-linked insurance plan or ULIP insurance plan-similar to pension plans, some of your insurance costs are invested in mutual funds, and the rest is used for death compensation.
Lifelong Life Insurance-As the name suggests, these documents provide the entire life insurance coverage of the entire person, rather than a specified period, some insurance companies may limit the entire life insurance period to 100 years.
An investment insurance policy, the “Children’s Insurance Plan”, provides lifelong financial assistance to your child. After the death of the parents, the death benefit can be obtained as total payment.
Refund-Such a policy will pay a certain percentage of the guaranteed plan amount after a regular interval. This is the so-called survival benefit.
Retirement plans-These plans, also known as retirement plans, are a combination of investment and insurance. Some insurance premiums are specifically used to create pension plans for policyholders, which can be paid in one time or monthly after the insured retiree.
If you have a life insurance plan, you can enjoy the following benefits of the policy.
Tax incentives-If you pay life insurance premiums, you are eligible for tax incentives in accordance with Articles 80(c) and 10(10d) of the Indian Income Tax Law. Therefore, you can save a lot of taxes by choosing a life insurance plan.
Encourage savings habits-because you need to pay premiums, buying this insurance policy usually saves money.
Ensure the financial future of the family-This policy ensures that the financial independence of the family can be maintained even if you die.
Help planning retirement life insurance policies, it can also be used as an investment option. For example, a pension plan provides a lump sum after you retire, which helps you fund retirement.
Now that you have understood all the contents of the life insurance policy, please continue reading to understand the different aspects of other general insurance policies.
2. Car insurance
Vehicle insurances are also types of insurances that provide financial assistance in an accident related to your car or bicycle. Auto insurance can be divided into three categories, including:
Auto types of Insurances -This policy cover personally owned four-wheelers.
Two-wheeler types of insurances -These plans include personally owned two-wheelers, including bicycles and scooters.
Commercial vehicle types of insurances -If you own a commercial vehicle, you should use insurance, because these policies ensure that your commercial vehicle remains in the best condition, which greatly reduces losses.
Types of auto insurance policies
According to insurance coverage or protection provided, auto insurance policies are divided into the following three types:
Third-Party Liability-This is the main type of auto insurance in India. According to the Motor Vehicle Act of 1988, this is a mandatory minimum for all motor vehicle owners. Due to limited financial assistance, the premiums of these documents are often very low, and these insurance plans only pay the financial responsibilities of the third parties affected in the above accidents to ensure that they will not face legal trouble caused by the accident. However, after the accident, no financial assistance was provided to repair the vehicle.
Comprehensive Insurance-Compared with third-party liability insurance, a comprehensive insurance plan provides better protection and security. In addition to covering the obligations of third parties, these plans also cover the costs of repairing damage to the policyholder’s vehicle due to an accident. If your vehicle is damaged due to fire, natural and man-made disasters, riots and other such situations, the comprehensive plan also provides a return service. Finally, if your bicycle is stolen, you can recover the cost of the bicycle. When you cover the blanket, you can also choose a lot of additional products through the comprehensive vehicle insurance policy to make it almost better. Some of these additional features include zero consumption, engine and transmission protection covers, consumer protection covers, and fault assistance.
Special Damage Compensation-This is a special form of car insurance provided by insurance companies to consumers. In addition, you are only eligible to use this plan when you purchase a two-wheeled bicycle or car after September 2018. The vehicle must be brand new and cannot be used for minor purposes. You should also remember that if you already have a third-party auto insurance policy, you can only benefit from this independent damages. With special compensation, you can basically get the same benefits as the policy without the third-party liability part of the policy.
Benefits of car insurance policy
The cost of cars and bicycles is changing rapidly. At this time, if there is no proper insurance to stay, it may cause huge economic losses to the owner. There are some benefits to buying such a plan.
Prevent legal troubles-help you avoid any other traffic and legal fines you may have to bear.
Perform all third-party responsibilities-If you hit or damage someone’s property in a car accident, an insurance policy can help you deal effectively with financial losses.
Financial assistance to repair a car after an accident, you need to spend a lot of money to repair your car. An insurance plan can reduce these expenses and allow you to repair them immediately.
Theft/lost insurance-If your vehicle is stolen, your insurance policy will help you recover some car/bicycle prices on the road. If your car is damaged and repaired due to an accident, you can expect similar help.
In addition, individuals with commercial/two-wheeled vehicles can also enjoy tax benefits if they pay premiums for the vehicle.
Health insurance benefits
After evaluating the different types of health insurance available, you should wonder why the plan is good for you and your loved ones. Please refer to the reasons listed below for the reasons.
Medical types of Insurances -The main benefit of this insurance is the financial insurance that can provide medical insurance.
Non-cash claims-If you are looking for hospital treatments that are linked to your insurance provider, you can take advantage of non-cash claims. This function ensures that all medical expenses are settled directly between the insurance company and the hospital.
Tax exemption-People paying health insurance premiums can enjoy income tax benefits, and according to Article 80d of the Income Tax Law, people can enjoy tax benefits up to Rs. 100,000 to pay health insurance premiums.
There may be other benefits depending on the insurance provider in question.
4. Travel insurance
When talking about different types of insurance policies, don’t forget to learn more about travel types of insurances plan, because these policies can ensure the financial safety of travelers on the road, so travel insurance is a short-term insurance compared to other insurance policies.
Depending on the provider you choose, travel insurance may provide financial assistance at different times, such as lost luggage, flight cancellation, etc. Here are some different types of travel insurance plans offered by the country:
Domestic travel types of insurances -This is a travel insurance policy that protects your money when traveling in India, but if you plan to go abroad for vacation, this policy will not provide any help.
International Travel types of Insurances -If you are leaving the country, be sure to choose the International Travel Insurance Plan. It enables you to pay for unexpected expenses that may occur during travel, such as medical emergencies, lost luggage, lost passports, etc.
House insurance during vacations-When traveling with family, your house is not protected. The chance of burglary is always great, which can lead to huge losses. It is also economically unaffected by such events.
The travel insurance plan covers the following:
Delays or cancellations of flights may result in significant passenger losses. If you purchase travel insurance, you can claim these financial losses from the insurance company.
Travel delay/baggage delay insurance allows you to request financial assistance in case of delay or loss of luggage during the flight. With this amount, you can purchase some necessary items.
Recover lost travel documents-visas and passports are essential documents for international travel. Choosing international travel insurance ensures that you have the necessary financial support to reapply for temporary or alternative documents when necessary.
Cancellation of travel coverage-Sudden family deaths or medical emergencies may disrupt your travel arrangements. Fortunately, the International Travel Insurance Plan supports cancellation of travel in such events. You can request financial assistance to pay fines and cancellation fees for flights, hotels, etc.
Please be careful to choose an insurance company, especially a reliable company available 24/7 to assist you.
5. Title or real estate insurance
Any real estate or building can be insured with a real estate insurance plan. This may be your home or commercial space. In the event of material damage, you can get financial assistance from your insurance provider. Note that this plan is also physical and protects the content of the property.
Home Insurance – Under this policy, you will not have any financial obligations that may arise from damage to your home or its content as a result of fire, theft, storms, earthquakes, explosions and other events.
Store Insurance – If you have a store that serves as your income source, you need to protect yourself from financial responsibilities that arise. Regardless of whether the responsibility is caused by a natural disaster or an accident, you can repair the store immediately with this plan.
Office insurance – another type of real estate insurance. Office insurance ensures that the office buildings and all equipment are largely protected in the event of an unexpected event. Generally, office equipment is expensive, such as computers, servers, and more. It is important to use this plan.
Building insurance – If you have an entire building, choosing a home insurance may not be enough, instead you can purchase building insurance to cover the entire building.
Benefits of real estate insurance
If you still believe that real estate protection is not one of the types of insurance plans you should take advantage of, consider some advantages.
Fire Protection – Although insurance policies cannot prevent fire, it can prevent your financial liabilities from occurring.
Robbery – If your property is located in a theft and theft-prone area, this policy is required to provide financial security.
Floods – Floods are common in some parts of India. This flood can damage your property and cause huge losses. Also, real estate insurance provides protection against such events.
Natural disasters – these plans also provide financial assistance for earthquakes and storm damage and more.
Real estate reconstruction or restructuring is expensive, so real estate insurance policies are the best option for long-term financial health.