What Do You Mean By Insurance?

What is insurance and its types?

Insurance is a legal agreement between two parties i.e.

the insurance company (insurer) and the individual (insured).

In this, the insurance company promises to make good the losses of the insured on happening of the insured contingency.

The insured pays a premium in return for the promise made by the insurer..

What is the types of insurance?

Most experts agree that life, health, long-term disability, and auto insurance are the four types of insurance you must have. Always check with your employer first for available coverage.

How much insurance do I need?

Even if your state doesn’t require liability insurance, it’s a good idea to have at least $500,000 worth of coverage that encompasses both types of liability coverage—property damage liability and bodily injury liability. … No matter what kind of car you drive, liability auto insurance is a definite must-have.

What is meant by insured?

noun. the person, group, or organization whose life or property is covered by an insurance policy.

What are the 7 types of insurance?

7 Types of InsuranceLife Insurance or Personal Insurance.Property Insurance.Marine Insurance.Fire Insurance.Liability Insurance.Guarantee Insurance.Social Insurance.

Which type of insurance is best?

Term Life Insurance Plans Term insurance is the purest and most affordable form of life insurance in which, you can opt for a high life cover for a specific period.

What is the premium for insurance?

A premium is the amount of money charged by your insurance company for the plan you’ve chosen. It is usually paid on a monthly basis, but can be billed a number of ways. You must pay your premium to keep your coverage active, regardless of whether you use it or not.

Who is called insurer?

1) An insurance policy is a contract between the insurer and the insured. … 3) The insurer is the insurance company that provides the insurance cover. 4) The proposer is the person who takes the cover and is also called the policyholder.

What is the aim of insurance?

The objective of insurance is to financially guard against unpredictable life occurrences. In short, when you buy an insurance policy, you make monthly payments, called premiums, to purchase protection from monetary repercussions related to things like accidents, illness or even death.

What is insurance class 11?

Insurance Insurance is a contract between the insurer and insured in which insurer agree to make good the loss of insured on happening of an event in consideration of a regular payment called premium. (i) Functions. (a) Protection. (b) Distribution of risk.

Who is an insured employee?

An employer-employee insurance policy is one in which the employer or company purchases insurance policy and the beneficiary is its employees. It is a benefit provided by an organization to its employees.

What are the features of insurance?

Features of InsuranceSharing of Risk. Insurance is a device to share the financial losses which might befall on an individual or his family on the happening of a specified event. … Co-operative Device. … Value of Risk. … Payment at Contingency. … Payment of Fortuitous Losses. … Amount of Payment. … A large Number of Insured Persons.

Why insurance is important in our life?

Life insurance is important, as it protects your family and lets you leave them a non-taxable amount at the time of death. It is also used to cover your mortgage and your personal loans, such as your car loan. Your individual life insurance follows you when you retire and you are no longer insured by your employer.

What is the meaning of insurance in simple words?

insuredInsurance is a term in law and economics. It is something people buy to protect themselves from losing money. … In exchange for this, if something bad happens to the person or thing that is insured, the company that sold the insurance will pay the money back.

What are the 4 types of insurance?

Different Types of General InsuranceHome Insurance. As the home is a valuable possession, it is important to secure your home with a proper home insurance policy. … Motor Insurance. Motor insurance provides coverage for your vehicle against damage, accidents, vandalism, theft, etc. … Travel Insurance. … Health Insurance.

What are the main concepts of insurance?

The basic principle of insurance is that an entity will choose to spend small periodic amounts of money against a possibility of a huge unexpected loss. Basically, all the policyholder pool their risks together. Any loss that they suffer will be paid out of their premiums which they pay.

What are the two types of insurance?

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.

What are the benefits of insurance company?

Benefits Of Getting Insured: Here’s Why You Should Get A Life Insurance?It protects your income from unexpected expenses. … It protects the money you’re saving for future plans. … It gives you the power to protect your family even when you’re not around anymore. … It protects your emotional health by giving you peace of mind.More items…