What is Insurance__

 Insurance is a contract (policy) in which an insurer

indemnifies another against losses from specific
contingencies or perils.

 There are many types of insurance policies. Life,

health, homeowners, and auto are the most
common forms of insurance.

 The core components that make up most insurance

policies are the deductible, policy limit, and
premium.

How Insurance Works

A multitude of different types of insurance
policies is available, and virtually any individual
or business can find an insurance company willing
to insure them—for a price. The most common
types of personal insurance policies are auto,
health, homeowners, and life. Most individuals in
the United States have at least one of these types
of insurance, and car insurance is required by law.
Insurance Policy Components
Three components of any type of insurance
are crucial: premium, policy limit, and
deductible.

o Premium: A policy’s premium is its price,

typically expressed as a monthly cost. The
premium is determined by the insurer based on
your or your business’s risk profile, which
may include creditworthiness.

o Policy Head: The policy limit is the

maximum amount that an insurer will pay
under a policy for a covered loss. Maximums
may be set per period (e.g., annual or policy
term), per loss or injury, or over the life of the
policy, also known as the lifetime maximum.

o Deductible: The deductible is a specific

amount that the policyholder must pay out of
pocket before the insurer pays a
claim. Deductibles serve as deterrents to large
volumes of small and insignificant claims.
 Types of Insurance
There are many different types of insurance. Let’s
look at the most important.

o Health Insurance: With regard to health

insurance, people who have chronic health issues
or need regular medical attention should look for
policies with lower deductibles. Though the annual
premium is higher than a comparable policy with a
higher deductible, less expensive access to medical
care throughout the year may be worth the tradeoff.

o Home Insurance: Homeowners insurance (also

known as home insurance) protects your home and
possessions against damage or theft. Virtually all
mortgage companies require borrowers to have
insurance coverage for the full or fair value of a
property (usually the purchase price) and won’t
make a loan or finance a residential real estate
transaction without proof of it.

o Auto Insurance: When you buy or lease a car, it’s

important to protect that investment. Getting auto
insurance can offer reassurance in case you’re
involved in an accident or the vehicle is stolen,
vandalized, or damaged by a natural disaster.
Instead of paying out of pocket for auto accidents,
 people pay annual premiums to an auto insurance
company; the company then pays all or most of the
costs associated with an auto accident or other
vehicle damage.

o Life Insurance: Life insurance is a contract

between an insurer and a policy owner. A life
insurance policy guarantees that the insurer pays a
sum of money to named beneficiaries when the
insured dies in exchange for the premiums paid by
the policyholder during their lifetime.

o Travel Insurance: Travel insurance is a type

of insurance that covers the costs and losses
associated with traveling. It is useful protection for
those traveling domestically or abroad. According
to a 2021 survey by insurance company Battleface,
almost half of Americans have faced fees or had to
absorb the cost of losses when traveling without
travel insurance.

What are the four major types of insurance?

There are four types of insurance that most
financial experts recommend everybody have: life,
health, auto, and long-term disability.
Why Should We Buy Insurance
Insurance is a way to manage your risk. When you buy
insurance, you purchase protection against unexpected
financial losses. The insurance company pays you or
someone you choose if something bad happens to you.
If you have no insurance and an accident happens, you
may be responsible for all related costs.

Survey On Insurance After Covid

The Covid-19 pandemic brought about significant
changes in people's behaviour towards protecting
health. To analyse the shift in public awareness about
healthcare.

57% feel their life insurance cover is insufficient:

Survey

India Protection Quotient has risen

2021 - 47%
2022 - 50%

IPQ is the degree to which Indians feel protected from future

uncertainties on a scale of 0 to 100, based on attitudes, mental
preparedness about future uncertainties, awareness and ownership of
life insurance products, including term, endowment and Ulips.
.