Insurance provides financial protection against loss. It is a type of risk management that is primarily used to mitigate the risk of a contingent or uncertain loss.
An insurer, insurance business, insurance carrier, or underwriter is a company that offers insurance. A policyholder is a person or entity who purchases insurance, whereas an insured is a person or entity who is covered by the policy. Policyholder and insured are frequently used interchangeably, although they are not synonymous, because coverage might occasionally extend to extra insureds who did not purchase the insurance. In exchange for the insurer’s pledge to compensate the insured in the case of a covered loss, the policyholder assumes a guaranteed, known, and generally small loss in the form of a payment to the insurer (a premium). The loss may or may not be pecuniary, but it must be quantifiable. Furthermore, it is frequently something in which the insured has an insurable interest as a result of ownership, possession, or a pre-existing relationship.
Types of Insurance:
In general, there are eight forms of insurance:
- Life Insurance: Life insurance is a policy or cover that allows the insured to assure financial independence for his or her family members after death. Assume you are the sole provider for your family, supporting your spouse and children.Your death would financially ruin the entire family in such a case. Life insurance policies prevent this from happening by giving financial help to your family in the event of your death.
- Motor insurance Motor insurance coverage provide financial support in the event of an accident involving your automobile or motorcycle. Motor insurance is available for three types of motorised vehicles, including:Car Insurance – This type of policy covers privately owned four-wheeler automobiles.
Two-wheeler Insurance – These policies cover personally owned two-wheeler vehicles such as motorcycles and scooters.
Commercial Vehicle Insurance – If you possess a vehicle that is utilised for business purposes, you must insure it. These policies ensure that your company’s vehicles remain in good condition, lowering losses dramatically.
- Health insurance Health insurance is a sort of general insurance that pays out money to policyholders who are admitted to hospitals for treatment. Furthermore, some policies cover the cost of treatment received at home before to hospitalisation or after release.With escalating medical inflation in India, purchasing health insurance has become a requirement. Consider the many types of health insurance plans available in India before going with your purchase.
- Travel insurance When discussing the many types of insurance policies, it is important to remember to understand more about travel insurance plans. Such plans ensure a traveler’s financial security while on the road. As a result, as compared to other insurance policies, travel insurance provides only short-term coverage.Depending on the service you choose, travel insurance may provide financial assistance at various situations, such as during baggage loss, trip cancellation, and so on.
- Property insurance Property insurance policies can cover any building or immovable structure. This might be either your dwelling or commercial premises.If such a property sustains damage, you can seek financial aid from the insurance company. Remember that such a plan also financially protects the contents of the property.
- Mobile insurance Because of the escalating cost of mobile phones and their various applications, it is now necessary to insure the gadget. In the event of unintentional damage to your phone, mobile insurance allows you to recuperate the money you spent on repairs.Furthermore, in the event of phone theft, you can claim the same, making it easier to replace the handset with a new phone.
- Cycle insurance Bicycles are valued assets in India since some people rely on them for everyday transportation.A cycle insurance coverage ensures that you have access to monies in the event that your bicycle is damaged or stolen. It reduces your out-of-pocket payments while also insuring immediate vehicle repairs.
- Bite-size insurance Bite-sized insurance policies are sachet insurance plans that limit your financial obligation for a set period of time, usually up to a year.These insurance policies enable you to safeguard your assets against specific harm or threats.For example, a specific bite-sized insurance may provide accidental cover of Rs. 1 Lakh for a year. You might select this policy if you believe you are particularly vulnerable to unintentional injury.
Another example is health insurance for certain disorders. For example, if your area is prone to water-borne diseases like cholera, you can choose a policy that covers cholera treatment as well as all associated costs for a year.
Top 5 Insurance Companies in India:
India Life Insurance Corporation
Life Insurance Corporation of India is India’s largest privately held state-owned insurance group and its largest investor. The Government of India owns it entirely. It also covers around 24.6 percent of the Indian Government’s expenses.
SBI Life Insurance Company Ltd.
It is a company that provides life insurance. SBI Life Insurance Company (SBI Life) was founded in October 2000 and has been registered with the Insurance Regulatory and Development Authority of India (IRDAI) since March 2001. It works in the life insurance business. SBI Life is traded on both the Bombay Stock Exchange and the National Stock Exchange. Based on revenue, it is the largest of the Top Insurance Companies in India.
ICICI Prudential Life Insurance Company Limited
ICICI Bank Limited and Prudential Corporation Holdings Limited jointly promote ICICI Prudential Life Insurance Company Limited (ICICI Prudential Life). ICICI Prudential Life commenced operations in 2001 and has regularly ranked among the top companies in the Indian life insurance industry.
HDFC Life Insurance Company Ltd
HDFC Life, founded in 2000, is a prominent provider of long-term life insurance solutions in India, providing a variety of individual and group insurance products to fulfil diverse customer needs such as Protection, Pension, Savings, Investment, Annuity, and Health.
The Company’s offering included 38 individual and 11 group products, as well as 8 optional rider benefits, to meet a wide range of consumer needs. It ranks third among the Top Insurance Companies in India in terms of revenue.
General Insurance Company
The General Insurance Corporation of India (GIC) was established in accordance with Section 9(1) of the GIBNA. It was formed as a private company limited by shares under the Companies Act of 1956 on November 22, 1972. The General Insurance Business (Nationalisation) Act of 1972 nationalised the entire general insurance business in India (GIBNA). It ranks fourth among the Top Insurance Companies in India in terms of revenue.