Monday, December 24, 2012

What are the Different Types of Insurance?


Humans are prone to sickness. Cars are prone to crashes. Buildings are prone to deterioration. Essentially, all matter and all possessions in the world that we have are subjected to getting damaged. As wise individuals, we should make sure that we won't suffer from such casualties financially. And poof, there's insurance that can safeguard us from losses.

What is an Insurance?

An insurance is a written contract that will compensate for the damage of anything, including the life of a person. Once subscribed to it, while the loss is not experienced, you will have to pay a periodic amount of money according to the terms and conditions and policies of the contract.

Choosing an Insurance Plan

I bet you have met many insurance brokers or agents asking you to sign up for an insurance plan with their company. They will get commission out of it. You have to choose which ones can provide the best security with higher returns in different scenarios. So you must know the coverage of each plan via-a-vis the damage done.

There are general insurances that cover damages of your properties whether caused by flooding, robbery, fire, etc. Besides that, there are many types of insurances. To better secure knowledge of them, read on the following list of the different types of insurance that can be availed in the market nowadays.


Funny how this is called life insurance when people can only obtain the financial benefits when the life insurance owner died. When you purchase a life insurance plan yourself, you will be insured that everything after your death will be settled. Your relatives will not be troubled anymore. The insurance company will grant them the monetary claims that you have paid within your insured time.


Auto insurance is not only a must for brand new cars but most especially for second hand automobiles or those which had already been used for more than five years. Auto insurance works to cover damages in one part or several parts of the vehicle. 

For example, the glass of your car's front lights were shattered after a minor car accident. As you are paying for regular installments of a certain premium amount for your car insurance, you can claim money from the insurance company to have your car lights fixed. Quotations differ so make sure to compare car insurances and get the best that suit your usage of the car or driving style. :)


In contrast to life insurance, health insurance compensates for your sickness bills. This is granted when you have proven that you have been stricken with some disease that is included in the coverage of the health insurance policy. You can go for medical treatments with selected hospitals stipulated in the plan and then reimburse the specified amount of premium for the doctor's consultation fee, hospital charges, medicinal expenses and other costs.

For what I know, health insurance companies will have your body or health checked up before they get you sign up for the insurance plan. This is because they won't take you as a client if you have existing multiple sicknesses already. For sure, they would be at a loss. So it's better to take a health insurance when you're still healthy and just continue paying for the premium until you get sick (when you're older).


There are too many uncertainties in businesses. High risks are present all the time, so it's recommended for you to purchase a business insurance plan to fit into your financial strategy or financial map. Find the best coverage there is for your business so you won't be too cramped up when mishaps happen somewhere along the way. Business insurance includes protection against sudden liabilities, insurance for your assets and other unexpected business interruptions.


Global warming is said to be making up for the end of the world, or not. Regardless the case, you have to get your house insured. This is the place where you stay at the end of every day. This space is supposed to be your sanctuary. 

When earthquakes split the ground into two and your house happens to stand in between, at least you are sure to be compensated by the home insurance policy you have. The premium for the home insurance can be a small price to pay as compared to the ones you have to shell out to rebuild the damaged parts.

End Notes

Choose the insurance plan that is equipped with the best policies for your lifestyle. You can buy several of them (from different companies to widen the scope and fight over the limitations individually) not only for your self but also your family and loved ones. Read the references in the Internet and discuss the pros and cons of each with a trusted insurance broker to find the best combinations of insurance plans.