Table of Contents
What is insurance?
Insurance is a security contract for a person, organisation or physical items, in which a person or firm receives financial protection or reimbursement against any losses from the insurance company. A person or Company pays the premium to the insurance company for their protection according to the insurance company's pricing plan.
There are many types of insurance available in the market some of them are, health insurance, life insurance, car insurance and homeowners insurance.
What does insurance do?
The main role of the insurance is to provide financial protection against any potential loss or damage. For example, if someone has a car or bike and suddenly meets with an accident their insurance policy will cover their vehicle repair cost.
Likewise if someone has medical insurance it will cover their medical treatment expense when they get ill or injured. By paying a premium, an individual or firm doesn't worry if they suddenly meet with any financial risk. This helps to save us with sudden financial impact and gives us peace of mind.
Types of Insurance
There are many types of insurance available, some of the most commonly used are,
- Auto Insurance: It covers damages that may occur to your car in an accident.
- Homeowners Insurance: It provides the coverage of a person's home or a property or liability.
- Health Insurance: It covers the medical expenses of a person if they get ill or injured.
- Life Insurance: It covers the beneficiaries who face sudden risk like death.
- Business Insurance: It covers the protection of business against potential losses such as liability, property damage and workers compensation.
- Disability Insurance: It pays to the person who gets suddenly disabled and not able to work anymore.
- Travel Insurance: It protects the person who travels against trip cancellation, any medical emergency, loss or stone of baggage.
- Pet Insurance: It covers the veterinary expenses for pets against any medical expenses or missing.
- Long-term Care Insurance: It helps the individual who needs assistance for their daily living in future.
- Umbrella Insurance: It covers an additional liability over and above the limits of other insurance policies, such as auto insurance or homeowner insurances.
Auto Insurance
Auto Insurance is also called car insurance. This type of insurance provides financial protection against any losses that occur suddenly like car accidents. In many states car insurance is mandatory if you are buying a car and driving.
The main purpose of car insurance is to protect the policy holder to claim in any case a car met with an accident. Auto insurance includes many coverages such as, liability, collision and comprehensive coverage.
Liability coverage is the very most basic coverage in auto insurance and is required by law in many states. This type of insurance covers and pays when damage or injury is made by you to the opposite person while you driving your car.
Collision coverage is on the other side when damage is made to your vehicle when you meet with an accident.
Comprehensive coverage is also known as other than collision coverage, which protects your vehicle from natural disaster, fire or theft.
To make a claim the policy holder should contact their insurance company immediately after met with an accident or incident. Along with that policy holder should submit the evidence such as date, time and location where they met with an accident.
Also they should give the co-passengers details if any travelled along with them when the incident happens. Also they should submit the police FIR copy also with any medical expenses or repair bills if any made.
It’s important that the policy holder should have the premium coverage already in place on his/her name to make a claim and the type of damage or accident should be already in mention. Also the policy holder should be aware of how much money they can claim for the incident they met with and what type of incident happens and it is eligible in the coverage.
In some cases, the insurance company may send their team to the incident spot and verify what type of damage happened and how much claim the damage is worth.
This verification may take a few days, weeks or more than that to analyse and make a detailed report about the accident and how much claim the policy holder is eligible for.
Once the insurance company finalised the statement whether they may approve or deny. If the claim is approved the policy holder may receive the amount in bank cheque with minus in any deductible.
Homeowners Insurance
Homeowners Insurance is a type of insurance policy which helps in financial protection of any damage or loss that happens for a person’s home or a property. It also helps in financial liability coverage for a person injured on the property. It is basically covered due to incidents like fire, natural disaster or theft.
To get a claim the house owner should contact their insurance company as soon as possible once the incident happens. As well they are supposed to submit the detailed description copy of the loss and how the incident happened and any supportive documents such as repair cost or policies or any documents which relates to damage to the house or property.
The insurance company will send their executive to validate the incident and to validate the damage. Once the verification has been done the claim may get approved or denied or deducted if any and process the cheque.
Health Insurance
Health insurance is an insurance which helps in financial protection of our medical expenses. It helps if the policyholder pays for the doctor visit, drugs, scans, surgery or hospital room stays.
To claim such type or insurance at first the policyholder should visit the doctor and get the necessary treatment for their disease and submit the original copy of treatment which they get from the hospital. As well the health insurance companies have certain criteria they won't allow claim if we took over all the hospitals only certain hospitals are approved for the reimbursement.
They will check all bill copies which are submitted by the policyholder and approve the claim up-to maximum.
Life Insurance
Life Insurance is a type of insurance in which benefits to the policyholder insured upon their death. The purpose of this type of insurance is to provide the financial protection to their loved one if the policyholder met with the unexpected death.
To claim this insurance that the nominee should inform the insurance company once the policyholder dies. To claim the policy amount they should submit the policyholder death certificate and other related legal documents as per insurance company policy.
Once the insurance company receives the necessary documents of the death policy holder, the insurance company will validate all the submitted documents and process the settlement amount.
This settlement amount may be given to the beneficiaries in lump sum or instalment method. This process may be straight forward but it’s recommended to read all the legal documents before signup. Also it is recommended to track from the beneficiary end.
Business Insurance
Business Insurance is a type of insurance which provides financial protection for business losses like liability, property damage, and workers compensation. It helps in protecting the business against unexpected damage like any accident or incident which may cause business losses.
To make a claim for this kind of insurance the business owner should contact the insurance company when the incident suddenly happens. At the time of contacting the insurance company the business owner should have in hand the valid business details and when the incident or accident happens.
Once the business owner reaches the insurance company the company will send the validator to the mentioned incident place to validate the issue. Once all in place and verified the insurance company will process the claim up-to maximum. But if the documents are not as per expected the insurance company will reject the claim.
Disability Insurance
Disability Insurance is a type of insurance which pays to the person who becomes disabled and they are unable to work anymore. The main purpose of this insurance is to protect the individual financial support for those who become disabled and they are not able to work anymore.
To make a claim the policy holder should reach out to the insurance company once they become disabled, as well the insurance company will ask for the necessary documents like doctor statement, existing policy copy.
Once we submit the policy copy to the insurance company, we will send the validator to our place and check the policy holder status and submit the report to the insurance company. If they are clear in what we submit as per their company standards our claim may Approve or Deny.
The insurance company may verify in a detailed way whether the policyholder is eligible for the claim or not. It is very important to understand the terms and conditions of the insurance company before we sign-up for this type of insurance.
Travel Insurance
Travel Insurance is a type of insurance that protects the travellers against unforeseen incidents such as, trip cancellation, medical emergency, lost or stolen baggage. Such type insurance created for travellers who met with an unexpected incident such as, trip cancellation, or any medical emergency or lost or stolen baggage.
Before sign-up such kind of insurance the policyholder who gonna start this travel insurance they should be aware about all the legal policies of the insurance company which they will provide the claim for the incident which happened related to the any medical emergency or stolen or lost baggage.
If any incident happened the policyholder should reached out to the insurance company with the proper evidence like if they met with any medical emergency they should carry the doctors notes, if their baggages have lost or stolen they should inform to the nearest police station and they should carry the police notes to the insurance company to make your lost real.
Once you have submitted all the necessary documents the insurance company will send the validator to check and confirm is that report was real, once they validate they will send their report to the insurance company and now they will finalise whether our claim could be Approved or Deny, depends on that our claim amount will be settled on the basis of cheque.
Pet Insurance
Pet Insurance is a type of insurance which covers the financial expenses for the pets. It helps in unexpected financial expenses to the pet such as illness, surgeries or any medical emergency.
To claim such type of insurance form the insurance company, first the policy holder should seek the treatment for their pet from the veterinarian. They should submit the necessary documents along with any extra paper asked by the insurance company.
Then the insurance company will send the person and validate the claims. If it passes you will get a claim amount in a cheque method by the insurance company. It is necessary to maintain all the documents as recorded from the policy holder end to show whenever the insurance company requested.
Long-term Care Insurance
Long term insurance is a type of insurance that covers the financial needs of a person on their daily activities such as, bathing, dressing, eating and so on.
It helps in the financial support of a person who subscribed for their future purpose. To claim such a service first the individual has already subscribed to long term policy. Before reaching the insurance company the policyholder should have the necessary documents in their hand like a doctor's letter that the individual needs care support or not.
Before processing their request to the claim the insurance company will validate the details and once all set good then they will provide the claims via cheque we just need to drop in the respected bank and collect the cash from the bank.
It is very important to sign-up for a long term insurance policy, the policyholder should read all the documents carefully and then if all policies of the insurance company come under our expectation then we can sign and start the insurance policy.
Umbrella Insurance
Umbrella insurance is a type of insurance that works an additional liability coverage over the limits of policies like auto or homeowners insurance.
Its main purpose is to give an additional policy security to the policy owners to claim the larger or any lawsuits. To make a claim of the umbrella insurance, the policyholder first has the liability claim which exceeds their limits of the other insurance.
The policyholders should contact the insurance company with all the necessary documents with all the legal papers. Once the insurance company validates the documents submitted by you and it got all cleared then they will provide the claim amount in cheque.
Advantages of Insurance:
- Financial Protection: The insurance will protect us in the financial standards if any unexpected events happen and that time we have not that much potential in the finance.
- Peace of Mind: Insurance helps in peace of mind when unexpected events happen.
- Risk Management: Insurance helps in managing financial needs when any risk occurs.
- Legal Compliance: In many cases, insurance is required by law, such as auto insurance, which helps individuals to comply with legal requirements.
- Disability and Long-term Care: Insurance definitely helps in any unexpected events of sudden disability or need for long-term care.
Disadvantages of Insurance:
- Cost: To avail the insurance is very expensive, especially for some types of coverage such as long-term care insurance are more costly.
- Limited Coverage: Insurance policies will not cover for the whole damage or any loss which we may get. There are some certain limitations to avail the claims.
- Claim Denials: Insurance companies often deny the claims with some false reasons to avoid giving the claims, this leads to the frustration to the policyholders and in certain conditions they will leave as it is without getting the claims.
- Complexity: Insurance policies and their process are much more complex and not easy to understand and get the claim in an easy manner for the policyholders.
- Exclusions: Some policies may not be covered in some type of insurance, so policyholders should be aware before they start with the insurance..
- Waiting period: Some insurance may have a long waiting period to get the claim after submitted the claim forms.
