The Beginner's Guide to Insurance
Having the right kind of insurance is central to sound financial planning. Several of us may have some form of insurance coverage but very few really understand what it is or why one must have it. For most Indians insurance policy is a form of investment or a superb tax saving avenue. Inquire a typical person about his/her investments and they will proudly mention an insurance policy product as part of their core investments. Regarding the approximately 5% of Indians that are insured the proportion of those adequately insured is significantly lower. Very few of the insured view insurance as purely that. There is perhaps no other financial product that has observed such rampant mis. Promoting at the hands of agents who are over enthusiastic to offer products linking insurance to investment earning them fat commissions. the General Insurance yahoo answersWhat is Insurance?
Insurance is a way of distributing out significant financial risk of a person or business entity. To a big 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 gross annual compensation paid to the company. In the purest form of insurance if the predefined event does not happen until the period specific the amount of money paid as settlement is not retrieved. Insurance coverage is effectively a means of spreading risk among a pool of folks who are insured and lighten their financial burden in the event of a shock.
Types of Insurance policy
Potentially any risk that can be quantified in conditions of money can be insured. To guard loved ones from damage of income due to immature death one can have a life insurance policy policy. To safeguard yourself and your family against unexpected medical expenses you can opt for a Mediclaim policy. To safeguard your vehicle against robbery or damage in accidents you might have a motor insurance policy. To guard your home against theft, damage due to open fire, flood and other challenges you can find dating a home insurance policy.Most popular insurance forms 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 chance in the event of premature death of the insured. There are twenty four life insurance companies enjoying in this arena of which Life insurance coverage Corporation of India is a open public sector company. There are several kinds of life insurance 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
All other insurance policies besides Life Insurance fall under General Insurance. There are 24 general insurance firms in India of which 4 namely National Insurance Company Ltd. New India Confidence Company Ltd, Oriental Insurance Company Ltd and Usa India Insurance provider Ltd are in the public industry domain.
The biggest cake of non-life insurance in conditions of premiums underwritten is shared by engine insurance followed by architectural insurance and health insurance coverage. Other types of insurance made available from companies in India are home insurance, travel insurance, personal accident insurance, and business insurance.