A new Beginner's Guide to Insurance
Obtaining the right kind of insurance is central to sound financial planning. A few of us may have some form of insurance coverage but very few really know what it is or why one must have it. For the majority of Indians insurance is a form of investment or a superb tax saving avenue. Request a typical person about his or her investments and they will proudly mention an insurance coverage product as part of their core investments. Of the approximately 5% of Indians that are insured the proportion of those adequately insured is a lot lower. Very few of the insured view insurance as purely that. There is perhaps no other financial product that has seen such rampant mis. Marketing at the hands of agents who are over enthusiastic in selling products backlinking insurance to investment earning them fat commissions. Life Insurance usaa reviewsWhat is Insurance?
Insurance is a way of spreading out significant financial risk of a person or business entity. To a huge group of individuals or business entities in the occurrence of an unfortunate event that is predetermined. The cost of being insured is the month-to-month or total annual compensation paid to the insurance company. In the purest form of insurance if the predetermined event does not occur until the period specified the cash paid as payment is not retrieved. Insurance policy is effectively a means of spreading risk among a pool of men and women who are insured and lighten up their financial burden in the event of a shock.
Types of Insurance
Potentially any risk that can be quantified in conditions pounds can be insured. To protect loved ones from reduction of income due to immature death one can have a life insurance policy. To guard yourself and your family against unanticipated medical expenses you can opt for a Mediclaim policy. To guard your vehicle against robbery or damage in accidents you might have a motor insurance policy. To protect your home against robbery, damage due to open fire, flood and other perils you can choose a home insurance policy.Most popular insurance types in India are life insurance, health insurance and motor insurance. Apart from these there are other forms as well which are discussed in short in the following paragraphs. The insurance sector is regulated and monitored by IRDA (Insurance Regulatory and Development Authority).
Life insurance coverage
This form of insurance provides cover against financial risk in the event of premature death of the insured. There are 24 life insurance companies actively playing in this arena of which Insurance coverage Corporation of India is a public sector company. There are several kinds of life insurance coverage policies the simplest form of which is phrase plan. The other complicated policies are endowment plan, whole life plan, money back plan, ULIPs and annuities.
General Insurance
Just about all other insurance policies besides Life Insurance fall under General Insurance. There are 24 general insurance providers in India of which 4 namely National Insurance Company Ltd. New India Confidence Company Ltd, Oriental Insurance policy Company Ltd and Usa India Insurance carrier Ltd are in the public sector domain.
The biggest curry of non-life insurance in conditions of premiums underwritten is shared by motor insurance followed by executive insurance and health insurance. Other kinds of insurance made available from companies in India are home insurance, travel cover, personal accident insurance, and business insurance.