A Beginner's Guide to Insurance
Obtaining the right kind of insurance is central to sound financial planning. Some of us may have some form of insurance policy but very few really understand what it is or why one must have it. For many Indians insurance coverage is a form of investment or a superb tax saving avenue. Ask 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 covered by insurance the proportion of those adequately insured is much lower. Very few of the insured view insurance as purely that. There is perhaps no other financial product that has seen such rampant mis. Promoting at the hands of agents who are over enthusiastic in selling products linking insurance to investment generating them fat commissions. weebly Insurance GuideWhat is Insurance?
Insurance is a way of distributing out significant financial danger of a person or business entity. To a sizable group of individuals or business entities in the occurrence of an regrettable event that is predetermined. The cost of being insured is the month to month or twelve-monthly compensation paid to the company. In the purest form of insurance if the predetermined event does not happen until the period specific the amount of money paid as payment 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
[caption id="attachment_14367" align="alignleft" width="300"]
insurance word on business folder showing risk management concept[/caption] Potentially any risk that may be quantified in conditions involving can be insured. To guard loved ones from damage of income due to immature death one can have a life insurance coverage policy. To safeguard yourself and your family against unforeseen medical expenses you can opt for a Mediclaim policy. To safeguard your vehicle against robbery or harm in accidents you might have a motor insurance policy. To protect your home against theft, damage due to fire, flood and other challenges you can choose a home insurance coverage.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 quick in the following paragraphs. The insurance sector is regulated and monitored by IRDA (Insurance Regulatory and Development Authority).
Life insurance coverage
This specific form of insurance provides cover against financial chance in the event of premature death of the insured. There are twenty-four life insurance companies actively playing in this arena of which Life insurance coverage Corporation of India is a general public sector company. There are several varieties of life insurance policy policies the simplest form of which is expression plan. The other intricate 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 companies in India of which 4 namely National Insurance Company Ltd. New India Guarantee Company Ltd, Oriental Insurance Company Ltd and Combined India Insurance Company Ltd are in the public field domain.
The biggest cake of non-life insurance in conditions of premiums underwritten is shared by engine insurance followed by engineering insurance and health insurance policy. Other types of insurance proposed by companies in India are home insurance, travel insurance, personal accident insurance, and business insurance.