What is Insurance?

Insurance is a type of protection to the policy holder for any financial loss that can arise due to an unexpected event only by paying a small amount of premium for it. The insurance company or insurer collects this premium amounts from various clients and than invest them in profitable market businesses.

Today there are different types of insurance available for different categories and one can choose them for their specific purposes. The some of the major types of insurance are: -
(a) Professional Indemnity Insurance for the protection of certain type of professions like medical, lawyer, accountants, etc.
(b) Auto Insurance which provides protection against damage, theft, bodily injury to others, treating injuries, rehabilitation, etc.
(c) Home Insurance which provides protection for any damage or destruction of a home from various disasters.
(d) Health Insurance provides protection from spending on any type of medical treatments.
(e) Life Insurance provides benefit of income to insured person’s family for any type of expenses after his/her death. In many countries the income from such insurance is free from any type of tax.
(f) Pet Insurance which provides protection from spending on pet due to an unprecedented event.
Apart from these there are many more types of insurance and before choosing for any of the insurance it is better to clearly understand the policies of the insurance company so that each and every risk involved is covered in the insurance policy. One may also take the advice from a Professional Insurance Broker for it.