What is Insurance
Insurance is nothing but a contract that is usually represented by a person or a group who will receive financial protection or protection from liabilities incurred by losses. The protection is given by an Insurance Company. Insurance companies make sure the insured will be able to pay the premium.
What is Insurance Cover
In the context of insurance, the phrase “Risk” generally refers to the thing you need to protect or maybe even your life. Insurance cover is the method of providing sufficient protection against the risk that you are insuring with an insurance company.
What is Insurance Policy
An insurance policy is a standard form of a contract given to the insured by the insurance company to confirm the Insurance company is liable to pay legally for the claims made under the terms of the Company in exchange for a small premium payment by the insured.
Insurance cover and Insurance coverage are the same Insurance coverage is the amount of the particular risk or a liability that will be covered for the insured by way of insurance services.
What Are The Principles of Insurance?
We now understand that insurance contracts provide customers with financial security and protection from any type of uncertainty in the risks covered. However, in order for the contract between the insured and the insurer to function properly, there are a few insurance principles that must be followed according to the law.
Here are the Principles of Insurance you need to know:
- Principle of Indemnity – This ensures that the insurance contract will indemnify or provide you with compensation for the actual amount of the loss suffered.
- Principles of Contribution – This is also a bit the same as the indemnity principle but it applies to instances where you might have more than one insurance policy for the same personal risk or entity.
- Principle of Insurable Interest – This simply means the principle of ownership where the policyholder himself should have the interest in the particular risk he has insured in his insurance policy.
- Principle of Subrogation – In this case, the general principle is to make sure the Insurance company stands up for the insured to cover his losses or damages for no fault of his own. The third-party will be held accountable for the loss caused to the insured.
- Principle of Loss Minimization – This principle applies to the insured where he is made aware that he should be responsible to minimise any kind of loss that might happen to him knowingly. This way the insured will be more careful and will protect himself in most circumstances. Though the loss or damage may be unintentional or uncertain the policyholder must take steps to minimise the after-effects.
- Principle of Proximate Cause – As the name implies it’s the principle that refers to the nearest cause for the loss or accident or injury that occurs. The principle however tells that the nearest cause must be taken into account to decide further on the liabilities.
- Principle of Utmost Good Faith – The insurance contract needs both the insurer and the insured to be in utmost good faith to ensure fairness in the event of any uncertainties. All material information is required to be disclosed to each other by both parties.
So basically the principles of an insurance contract make sure it is genuine between the insurance company and the insured person or entity.
What Are The Basic Types Of Insurance In India?
Are you curious about the basic types of insurance that are offered? Keeping yourself informed is a smart practice, and we are here to assist you!
Here is a list of the various types of Insurance in India:
- Life Insurance – Your life is valuable, and even though we cannot predict diseases, we can always be ready to protect ourselves with insurance coverage.
- Motor insurance – Your car is both a prized possession and one of the risks you need to consider. While having a car is a fantastic experience, protecting it is equally crucial. Protection for third parties as well as your car is a need. This aids in keeping your mind relaxed. There are different types of motor insurance
- Health insurance – With the appropriate premium payment, this solely considers specific health-related issues. In addition to receiving many health benefits, you also pay less overall. Among the leading health insurance plans, you may choose any of these for your health which is more than what you pay.
- Home insurance – The most valuable asset in your life is your own home. To protect it against any kind of unforeseen circumstances also thus becomes crucial to keep yourself worry-free.
- Travel insurance – There might be a lot of chaos while you travel outside your country especially. To give protection to those kinds of events there is Travel insurance.
Many insurances are a must-have as per the law in India like Health insurance, Motor insurance etc to keep you safer rest depends on a person’s interests but those too are unavoidable covers which will be ultimately purchased by the insured.
Stay with us to find affordable insurance plans, just for you!