What is Insurance? Types and benefits of Insurance.

You can define Insurance as a financial tool that helps you in crisis like which you need money desperately. In insurance, an legal contract is made between you and Insurance provider in this process you have to pay some amount of money according to your insurance type, and when you need that money during crisis you can claim that money. Now the question rises, how do you know you are going to suffer financial loss in the future? well, we don’t know but to be sure there is no harm in taking security steps before something happens.

Do you get money back if nothing happened to you?

Well that’s simple question but most of the people don’t know the answer. Why you will give your money based on the prediction that you might suffer financial loss in the future if you are not going to get that money back. Ofcourse you will get that sum of money but there are conditions you have to follow You have to keep the insurance for the whole period of time that you have chosen once that is completed you can get your money back. you will not receive your money if you missed the monthly premium or stopped paying. In bot cases you won’t get any money or in simple words your money is gone.

Types of Insurance

There are broadly two types of Insurance

  • General Insurance
  • Life Insurance

General Insurance

You can General Insurance in simple words that means it doesn’t apply death of a person. General insurance is for materialistic things like House, vehicles travel and health. In this type of insurance company will pay for your loss like Damage to vehicle, medical treatment, theft(digital or physical) and other things.

Things that comes under general insurance:

Health Insurance

This type if insurance will cover for your medical bills in case of accidents or serious injury. But you have to take care to your pre-existing disease in insurance terms and conditions before buying a premium.

Motor Insurance

This type of insurance cover the damage of your vehicle caused by accident, fire, or theft. Motor insurance is mandatory in many countries you can’t drive your own vehicle on road if you don’t have insurance for that vehicle. This includes our country India also. The insurance company will pay for damage according to your plan of your insurance purchase.

Motor insurance is of two types :

  • Car insurance
  • Two-wheeler insurance

Travel Insurance

This type of insurance covers for the loss of financial property during your travel like loss of baggage, loss of passport and Accidental death.

Home Insurance

This type of insurance covers for the damage for your home due to nature or man-made disasters.

The most important thing about this is that it not only covers for your house but also for the valuable items in the house.

Fire Insurance

This type of insurance covers for the loss due to fire to your property. it may include replacement or repair for the damaged items. It also covers for the damage caused by any third party due to fire like if you are filling petrol at a petrol station and your bike caught, fire you will get compensation from insurance company. and also will cover for you if you have been injured and any other who have been affected due to that accident. now we will cover the second type of insurance.

Life Insurance

This type of insurance is compensation in case of your death. Life insurance helps to support your family even after your death, the insurer promises to pay the amount after your death.

How to claim insurance?

  • First of all, you have to claim to your insurance
  • You have to give details about the damage that you have suffered.
  • Submit proof like photos or in case of an accident hospital bill.
  • Then the company will verify your claim.
  • Then you will be paid for your loss

Disclaimer: Read terms and condition carefully before buying insurance, if you don’t do so you might get tricked during clamin and lose your all money, Be careful.


I write because I don't like speaking.

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