Insurance
Insurance is all about PROTECTION from any financial loss. Any form of Insurance is meant for protection and mitigating risk of uncertainties which might occur in the form of death, disability, accident, medical emergency, business loss, professional liability and others.
How does it work?
Insurance is a legal agreement between two parties i.e. the Insurance company (Insurer) and the Individual (Insured Person). The insurance company promises to pay claim amount to insured for losses if occur as per the terms & condition decided at the time of buying insurance. To cover the risk of potential loss, there is a premium which needs to be paid to the Insurance company by Insured Person.
What are the types of Insurance available in India?
Insurance in India have been classified in to three different categories:
• Life Insurance
• Health Insurance
• General Insurance
What is Life Insurance?
As the name suggest, Life Insurance is an Insurance on your life. Life Insurance is bought to make sure your dependents are financially secured in the event of your untimely demise or disability which restricts the income of the breadwinner of the family.
In India Life Insurance is the most miss-sold product. But in recent past, the understanding and the approach towards life insurance products has changed. But still there are different variants of Life Insurance present like – Term Insurance, Endowment Plan, Money Back Plan, Whole Life Insurance, ULIPs etc.
We at Gita Financial mostly suggest pure risk cover plan which is Term Insurance, which can be bundled with different riders like critical illness, accidental benefit, disability benefits and so on. Term Insurance is the cheapest insurance in which only the risk is covered and there is no investment component. Since the premium is low there is no maturity pay-outs. The sum assured is paid only in case the event occurs.
What is Health Insurance?
Health Insurance is an Insurance in which the Insurer pays for Medical and Surgical expenses suffered by the Insured I.e. Policy Holder. This type of insurance compensates the insured for expenses incurred from illness, injury or pays the care provider directly. The premium paid towards a health insurance policy usually covers treatment, hospitalization and medication costs.
We at Gita Financial understand your requirements and on the basis of that we would suggest the right Health Insurance.
What is General or Non-Life Insurance?
General Insurance is an Insurance for valuables other than our Life. General Insurance covers the insurance of property against fire, burglary, theft, Personal Insurance covering health, travel and accident; and liability insurance covering legal liability. The premium and coverage of general insurance depends upon the type and extent of insurance. A general insurance policy typically has a period of a few years and does not have cover for lifetime.
In India, General Insurance policies are of the following types like motor, fire, home, marine, health, travel, accident, professional indemnity, liability, shop etc.
People have been ignoring general insurance as they do not consider it to be relevant but it is very important for a common man. For corporate and professionals like doctors, lawyers, engineers it is really important as you have to safeguard yourself against any sort of liability which might occur in the due course of your providing services to your clients.
We at Gita Financial suggest General Insurance Planning as a risk management tool which hedge against the risk of contingent and uncertain financial loss.