2. Insurance is a contract of indemnification in which one party (the
insurer or the insurance company) seeks to assure the other
party (insured or the individual taking insurance) entering into
contract, that he will be insured against a specified amount
which is pre-decided, in case of any unseen circumstances.
Insurance is based upon 7 basic principles which are as follows:
๏ผ Principle of Utmost Good Faith
๏ผ Principle of Indemnification
๏ผ Principle of Insurable Interest
๏ผ Principle of Subrogation
๏ผ Principle of Causa Proxima
๏ผ Principle of Contribution
๏ผ Principle of Loss of Minimization
WHAT IS INSURANCE
3. There are two broad categories of Insurance :-
1. Life Insurance
2. General Insurance
TYPES OF INSURANCE
4. A life Insurance policy seeks to provide the sum assured to the
beneficiaries of the insured in case of any mishap.
A Life Insurance Policy has benefits other than providing you a
life cover, the following are the benefits:
๏ Mortgage Protection
๏ Retirement Benefit
๏ Childcare
๏ Estate Protection
A life insurance policy can be further divided into :-
LIFE INSURANCE
5. 1. Term Assurance: A term assurance policy is one in which
the sum assured is paid only if the insured dies within the
term, if he survives the term nothing is paid.
2. Whole Life Assurance: It seeks to cover the insured for his
entire life and the sum assured is paid to his beneficiaries in
the event of his death.
3. Endowment Assurance: Endowment Assurance provides
protection to the insured and the sum assured is paid in the
event of the insureds death during the term or even if he
survives the amount is paid, but it should be within the
term.
4. Annuities: In annuities, the insured pays a lump sum
amount to the insurer and the insurer pays a regular
amount to the insured until his death.
6. GENERAL INSURANCE
A general insurance policy seeks to provide insurance other than
life insurance; such as marine insurance, fire insurance, theft
insurance, house property insurance etc.
General Insurance can be further divided into:-
๏ Fire Insurance:
๏ Marine Insurance:
๏ Health Insurance:
๏ Motor Insurance:
7. FIRE INSURANCE
A fire insurance policy seeks to cover the insured against
damages that might occur due to a fire. In this case to take the
claim the actual reason of damage should be fire not any other. It
is designed to cover the cost of replacement, reconstruction or
repair, damage to the building itself, and may also cover damage
to nearby structures, personal property and associated expenses.
8. MARINE INSURANCE
Marine Insurance provides a cover against any damages that
might occur while the goods are being transported by rail,
road, sea or air. Marine policies cover the property or 'interest'
insured against damages caused by the sea such as bad
weather, stranding, collision, fire, while aviation insurance
covers damage on the ground or in the air, and liabilities for
cargo and passengers.
9. HEALTH INSURANCE
In this the medical expenses are paid for which the insured
incurs. The policy provides a cover in the following situations
in the event of death, permanent disablement or loss of eyes or
limbs due to accident or if the insured is unable to work due
to accident (or sickness).
10. MOTOR INSURANCE
Seeks to provide a cover for collisions that might occur on the
road.
There are three types of motor insurance:-
๏ข a) Car Insurance: This policy mainly covers damages that
happen to the car and also covers against third party liability
insurance.
๏ข b) Two Wheeler Insurance: A two wheeler insurance, is a type
of policy falling under the motor vehicle insurance and
provides a cover for theft and damages to the bike or scooter.
๏ข c) Commercial vehicle Insurance: This type of policy covers
damages to the commercial vehicles such as passenger
carrying vehicles, private and public carriers, miscellaneous
and other type of vehicles.
11. Hope the above information we shared with you must be helpful for
buying a new insurance policy.
If you are interested in buying home insurance, please feel free to
reach us from any of the touch points mentioned below and we'll be
happy to assist you.
Call us Toll Free No. : 1800-209-5846
or SMS 'LTI ' to 56070 58 (56070-LT)
