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Different types of insurance policies in India

  • Highlights

  • Insurance is a cover for monetary loss from unforeseen events

  • There are two broad categories of insurance policies - life and general

  • Insurance policies can be purchased online and offline

  • Online purchase offers a hassle-free experience

Insurance provides us with a financial shield against the various uncertainties of life. While you can take health insurance to safeguard yourself from financial difficulties arising out of health problems, an accident cover can help cover monetary loss arising from accidents. It is imperative that you choose the right type of insurance to secure yourself and your family from financial risk. With the right combination of policies, you can insure almost all of your assets and live worry-free.

Types of Insurance Policies:

In India, insurance is broadly categorized under two groups:
• Life Insurance
• General Insurance

Let’s learn a little more about these varieties of insurance:

1. Life Insurance:

Life insurance cover policy holders against their untimely demise. In such cases, the insurance company pays the policyholder’s beneficiaries a pre-approved sum.

A few variants of life insurance are listed below:

- Whole Life Plan: Whole life plans provide policyholders coverage for the entirety of their life (or till 100 years of age). These plans are often used to create an inheritance.
- Term Plan: Term plans provide a life cover for a specific term. However, no payments are made if the insured survives the tenor.
- ULIP: ULIPs provide a life cover, along with investment in equities, the debt market, etc. In case of the insured’s demise, the nominee gets the sum assured or fund value, whichever is higher.

Additional Read : Consider These Things Before Buying Home Insurance

General Insurance:

All non-life insurance policies are clustered under general insurance. These policies are for shorter tenures (around twelve months), but policyholders have the option of renewing them.

Popular variants of general insurance include:

- Health Insurance: Health or medical insurance covers healthcare costs. These policies can be either individual or group policies, which extend the health cover to the whole family.
- Motor Insurance: Such policies cover two wheelers, private cars and commercial vehicles against theft, physical damage from accidents, natural or man-made calamities. They even cover liabilities arising out of third party damage/injury.
- Home Insurance - Home insurance covers your home against losses arising out of fire accidents, weather conditions, theft, etc. This type includes standalone policies like fire insurance, earthquake insurance, flood insurance, boiler insurance, etc., to protect your assets.

Additional Read : 5 Best Car Insurance Plans To Choose From

Be it life insurance, health insurance or motor insurance, you can purchase them online as well as offline. Just as there are agents who help with buying a policy, there are also websites for the same purpose. Additionally, purchasing online allows for quicker comparisons and application.

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