Main Types of Insurance
1. Life Insurance
Purpose: Pays a lump sum upon the policyholder’s death to support family and dependents.
Popular options:
Term Life: Pure protection, lowest cost, high coverage.
Whole Life/Endowment: Covers for a lifetime and may offer some savings benefits.
ULIPs: Pack investment with insurance, but are more complex and expensive.
2. Health Insurance
Purpose: Pays for hospitalization, treatments, surgeries, medicines, and major illnesses.
Popular options:
Individual or Family Floater: Covers one or several people under a single plan.
Senior Plans: Extra coverage for older adults.
Critical Illness: Lump sum for severe conditions like cancer, heart attack.
3. Motor Insurance
Purpose: Mandatory for vehicles. Covers repairs, replacements, third-party injury/property damage.
Popular options: Third-party (minimal), comprehensive (maximum protection).
4. Home & Property Insurance
Purpose: Covers damage or loss from fire, flood, theft, or other disasters.
Popular options:
Basic Structure Cover: For building only.
Contents Cover: For possessions inside the home.
5. Travel, Accident & Other Insurance
Purpose: Protection during trips, personal accidents, or disability.
Popular options: Single-trip, annual travel, or accident/disability covers.
How to Choose the Right Cover
1. Assess Your Risks & Needs
Family dependents? Get life cover.
Health bills worry you? Opt for strong health insurance.
Own a car or house? Protect assets from damage or liability.
Travel often? Use travel insurance.
2. Compare Multiple Plans
Use aggregator sites or direct insurer quotes.
Compare cover amounts, premiums, exclusions, claim settlement record, and benefits.
3. Buy Adequate (Not Minimal) Cover
For life insurance: Usually 10–20x your annual income.
For health insurance: At least enough to cover major hospital bills or surgeries.
4. Read the Fine Print
Study inclusions, exclusions, waiting periods, and special clauses.
5. Review Every Year
Upgrade or add policies as your life, income, and responsibilities change.
Conclusion
Each insurance type has a specific purpose. The right cover comes from knowing your risks and matching policies to your budget and needs. A little homework now means lasting protection and fewer financial worries later.