describe the various types of insurance?
Answers
Answer:
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Explanation:
Life will throw you a curve ball — there’s no question about that. Whether you’ll have insurance when it does is another matter entirely.
Insurance buffers you from unexpected costs. And while most people know that insurance is important, not everyone knows the different types of insurance out there and how they can help.
Some common types of insurance include:
Health insurance
Car insurance
Life insurance
Home insurance
But there are others, too. Here are eight types of insurance, and eight reasons you might need them.
1. Health insurance
Why you need it: Both expected and unexpected health care expenses — including routine visits, medications, emergency stays, and serious surgeries — can add up quickly and cause a lot of debt for those who can’t afford the out-of-pocket costs.
Who needs it: Everyone
What it is: Health insurance is a contract between a health insurer and a policy holder that requires the health insurer to pay for all or at least a portion of medical costs.
2. Car insurance
Why you need it: Driving while uninsured is against the law and dangerous because the driver and their vehicle aren’t protected against an accident, collision, or general theft and vandalism.
Who needs it: Drivers
What it is: Auto insurance covers cars, motorcycles, trucks, and other vehicles, and is intended to protect against physical damage or bodily injury that could result from driving, whether the incident is reckless or an accident.
3. Life insurance
Why you need it: Death can be expensive — from settling an estate to planning a funeral, the associated costs can really set you back — but a life insurance policy will ease the financial burden placed on a surviving spouse and dependents (i.e. children).
Who needs it: Those with dependents
What it is: In the event of death, a life insurance policy pays a beneficiary an agreed-upon amount of money to cover the expenses left by the deceased. A beneficiary is the person or entity named in a policy who receives benefits, such as a spouse.
4. Homeowners insurance
Why you need it: Maintain your home and keep its property value high, plus be covered in the case of major damage, like a house fire.
Who needs it: Homeowners and landlords
What it is: Homeowners insurance covers the house you reside in and any associated structures, such as a porch, garage, and balcony.
5. Umbrella insurance
Why you need it: If you think you may need extra coverage in addition to another type of insurance policy, for example on a home or vehicle, then umbrella insurance will help further protect you from risk of being sued for damages.
Who needs it: Anyone already insured
What it is: Liability insurance is what’s called umbrella insurance, because it covers costs in excess of other insurance policies.
6. Renters insurance
Why you need it: Things happen — that’s a mantra every renter knows to be true, and so they protect themselves and their property while renting. In fact, many landlords require it.
Who needs it: Tenants
What it is: Renters insurance is used by tenants to cover personal property in case of damage or theft, which is not the responsibility of the landlord.
7. Travel insurance
Why you need it: Planning to jet off to a new destination? Then make sure the cost of your airfare is covered in case of medical emergencies or other incidents that may cause a trip to be cut short.
Who needs it: Travelers
What it is: Travel insurance covers trip cancellations, lost or misplaced luggage, travel accidents, and even medical expenses while on the trip.
8. Pet insurance
Why you need it: Paying into pet insurance may be more cost-effective than paying a lump sum to your vet should your pet need emergency medical treatment, like an emergency room visit.
Who needs it: Pet owners
What it is: Pet insurance (mostly for dogs and cats) covers all or part of veterinary treatment when a pet is hurt or sick. There are two types of pet insurance: a wellness plan that covers routine visits and shots, and a health insurance plan that is more comprehensive of genetic diseases and major surgeries.
Answer:
There is a wide range of insurance policies, each aimed at safeguarding certain aspects of your health or assets.
Broadly, there are 8 types of insurance, namely:
Life Insurance
Motor insurance
Health insurance
Travel insurance
Property insurance
Mobile insurance
Cycle insurance
Bite-size insurance
1. Life Insurance
Life Insurance refers to a policy or cover whereby the policyholder can ensure financial freedom for his/her family members after death. Suppose you are the sole earning member in your family, supporting your spouse and children.
2. Motor Insurance
Motor insurance refers to policies that offer financial assistance in the event of accidents involving your car or bike. Motor insurance can be availed for three categories of motorised vehicles, including:
Car Insurance - Personally owned four-wheeler vehicles are covered under such a policy.
Two-wheeler Insurance - Personally owned two-wheeler vehicles, including bikes and scooters, are covered under these plans.
Commercial Vehicle Insurance - If you own a vehicle that is used commercially, you need to avail insurance for the same. These policies ensure that your business automobiles stay in the best of shapes, reducing losses significantly.
3. Health Insurance
Health insurance refers to a type of general insurance, which provides financial assistance to policyholders when they are admitted to hospitals for treatment. Additionally, some plans also cover the cost of treatment undertaken at home, prior to a hospitalisation or after discharge from the same.
4. Travel Insurance
When talking about the different types of insurance policies, one must not forget to learn more about travel insurance plans. Such policies ensure the financial safety of a traveller during a trip. Therefore, when compared to other insurance policies, travel insurance is a short-term cover.
5. Property Insurance
Any building or immovable structure can be insured through property insurance plans. This can be either your residence or commercial space. If any damage befalls such a property, you can claim financial assistance from the insurance provider. Keep in mind that such a plan also financially safeguards the content inside the property.
6. Mobile Insurance
Owing to the rising price of mobile phones and their several applications today, it has become imperative to insure the device. Mobile insurance allows you to reclaim money that you spend on repairing your phone in the event of accidental damage.
Further, you can also claim the same in case of phone theft, making it easier to replace the handset with a new phone.
7. Cycle Insurance
Bicycles are valuable properties in India as some people rely on these vehicles for their daily commute. A cycle insurance policy ensures that you have access to necessary funds should your bicycle undergo accidental damage or theft. It saves your out of pocket expenses, while also ensuring immediate repairs to the vehicle.
Benefits of Cycle Insurance
The advantages of availing such an insurance policy are:
Worldwide Coverage - Depending on the insurance provider, cycle insurance policies provide financial assistance regardless of where your bicycle undergoes damage. Even if you meet with a cycling accident in a different country, such a plan will offer aid.
8. Bite-Size Insurance
Bite-sized insurance policies refer to sachet insurance plans that minimise your financial liability for a very limited tenure, generally up to a year.
Explanation:
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