Friday, January 29, 2010

Protection against risk through Insurance

Insurance is a form of risk management primarily used to protect against risk of a contingent loss. We have many types of insurance like life insurance, health insurance, auto insurance, property insurance, Liability insurance etc. Common benefit for all insurances is exemption for tax.

Protection of different insurances:
If you take any insurance, its primary use is to give financial support against loss/damaged/theft.

  • Life Insurance: This insurance provides the income to insured person's family in case of death only. Life insurance also contains many type of insurances. In simple words, provides financial protection to beneficiaries usually spouses and dependent children upon the death of the insured person.
  • Health insurance: This insurance provides cost of medical treatments resulting from accidents and illness.
  • Auto Insurance: This insurance protects you against financial loss if you have an accident. Auto Insurance is also known as vehicle insurance.
  • Property insurance: This insurance provides protection against risk to property resulting from fire, theft, and damage due to natural calamities.
  • Liability insurance: This insurance provides protection to policyholders from financial responsibility for injuries to others or for damage to other people’s property.
No one can afford all the insurances so you should select the insurance which you really need and protects you and your family. Most of the people do not understand the importance of insurance. The wealthiest person do not need insurance as he has already financial support but who are not wealthy they must have insurance to get financial support.

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