Insurance is a type of risk management that helps to protect you and your family from financial loss happens due to uncertain reasons or mishaps. For this Insurance, you have to pay a small amount to the insurer and if any loss will happen to your belonging then they will cover the damage or expenses to that loss. Also, it is very compulsory to take the advice of any financial experts who will help you to get the best insurance plan.
Advantages to having insurance: There are a lot of things that you can take benefited by taking insurance.
- It provides safety and security to your belongings from theft and damage.
- It helps you to recover the financial loss in an emergency situation.
- It provides monetary help to your family after you.
- It helps you to encourage savings.
- It helps to increase the economic growth of the country and decrease the inflation rate
- It also helps you to avail tax benefits as per section 80C in life insurance and Section 80 D in health insurance.
- It also provides helps in the case of a medical emergency.
Disadvantages of insurance: Alike everything, insurance also has some disadvantages that we have to face at some point.
- Complex policies of the insurance companies.
- Risk of fraud or get cheated
- It takes a long time to claim benefits due to lengthy legal formalities.
- Provide mental stress if in case you will not able to pay the premium on time.
- It also led to an increase in the crimes in the family, as the beneficiary will get the insured amount.
- Profit margins take by brokers are too high.
Types of Insurance: There are a variety of insurance facilities available in the market offered by many renowned companies. But you have to choose it yourself, which plan is best suited for you. Whether you can pay the required premium amount for it or not. Below are some major types of insurance facilities that are commonly taken by us:
Life Insurance: It is the most basic as well as an important type of insurance that we all must have heard about and also covered ourselves with is Life insurance. As we all know that life is the most precious thing to us, more than anything else in the world. After life, the second important thing is your family. If you are there you can take care of your family, but in case if something will happen to you unexpectedly then life insurance is the one that will provide financial security to your family and dependent people after you. Life insurance is basically of 2 types i.e. Whole life insurance and term insurance.
In whole life insurance, you have to pay your premiums till death but in term life insurance you have to pay a regular amount of money for a fixed period of time.
Health Insurance: You never know when and how come a disease can affect you, in such cases, Health insurance is proven to be a relief for you. If you have to get admitted to a hospital due to some critical disease, then you can easily take the Mediclaim from the company if you have already taken health insurance. Even if have to just visit a doctor due to some regular infection such as cold or cough, then also it provides monetary benefit for your hospital expenses and stays.
Vehicle Insurance: When your vehicle got damaged due to the accident, then the vehicle insurance will help you to claim the expenses of damage from the company. It will further depend on the type of insurance whether you will get the complete cost of the loss or some percent from the total damage expense.
Property Insurance: Property insurance helps you to recover the loss that happened to your property or basically to your earning source. As the farmer can insure their crops and animal engaged in business. You can ensure your house and shops to compensate for the losses due to fire, protect any goods from theft, marine perils loss and many more examples are there in daily life.
Fire Insurance: Accidents can happen anytime, so the fire insurance will provide reimbursement of the losses caused due to fire to your house, shops or animal sheds. The reason for fire may be short circuits, gas explosions or any natural disasters.
Auto Insurance: This insurance is basically forthe drivers who drive vehicles on rent. If the other driver, you or any passenger get injured in an accident, then this auto insurance will pay the expenses and protect you from litigation of accident. It also protects your vehicle against theft or any natural disaster.
The regulatory body for an insurance company: IRDAI established in 1999 is the major power that monitors and regulates the insurance companies in India. It consists of 10 members that are assigned by the government of India. Its headquarters is based in Hyderabad, Telangana. Its regional offices are based in Delhi and Mumbai.