In today’s world, dealing with unplanned expenses is a harsh truth. Certainly, when you feel you are financially stable, an unexpected expense appears and ruins your all future panning.
Although you cannot plan beyond the uncertainties arising due to such incidents, insurance policies contribute massive support to minimize financial risk due to the sudden occurrence of unexpected events.
There are many types of insurance policies available in India, namely:
- Life Insurance
- Motor insurance
- Health insurance
- Property insurance
- Educational insurance
Just identifying the various insurance policies would not give any benefit. Rather, you must understand how all of these insurance plans work., So here is a complete guide to the various types of insurance policies.
A Life Insurance policy is a type of insurance in which the policyholder ensures financial freedom to his/her family members after death. Assume you are the single earning member in your house. In case of your death, Life insurance policies provide financial assistance to your family after your death.
Types of Life Insurance Policies
- Term Plan –The death benefit is only available for 40 years from the date of policy acquisition.
- Endowment Plan – In this plan, a portion of your premiums go toward the death benefit and the remaining amount is invested by the insurer.
- Whole Life Insurance –such policies offer life cover for the whole life of an individual (up to 100 years)
- Money-Back –These policies help in paying a certain percentage of the plan’s amount assured after a regular interval of time.
Motor Insurance/ vehicle insurance
Motor insurance offers financial support to the policyholder due to any accidents involving your car or bike. Motor insurance includes:
- Car insurance: it involves four-wheeler vehicles.
- Two-wheeler insurance– It involves two-wheeler vehicles, including bikes and scooters.
- Commercial vehicle insurance– If you own a vehicle for commercial purposes, you should avail coverage for the same.
It is a type of general insurance, which contributes financial help to policyholders when they pay heavy bills to hospitals for treatment. Additionally, these plans also cover the bills of treatment begun at home under certain terms and conditions.
Health Insurance policies in India:
- Single health insurance – These are the plans that offer medical assistance to just one policyholder.
- Family Floater – These policies include your whole family and you need not to buy a separate policy for each member.
- Critical insurance cover: These plans give financial assistance to those suffering from specific chronic diseases.
- Maternity insurance – This policy covers all the medical expenses starting from the pregnancy till the child is born.
Property Insurance/Home insurance
Any building owned by you covers this type of insurance. It includes your residential house or the office.
Types of Property Insurance
Home insurance policy: In this policy, you live independent from all financial obligations that may occur due to any destruction of your home due to fires, earthquakes, and other issues.
Shop insurance: If you purchase any commercial room or building, which serves as a source of income for you. With the help of this plan, you can easily get the funds for repairing the shop.
The Education Insurance Policy is an insurance plan specially used as a savings scheme to provide an education fee when your children enroll in college (18 years or above). The policy fulfills your child’s educational requirements, even when you are not present, and covers all college expenses.