Types of Insurance
Various types of insurance exist by virtue of practise of insurance companies and the influence of the influence of legal enactments controlling the insurance business. Broadly speakin, insurance may be classified as follows:
Life Insurance :
Life insurance may be defined as a contract in which the insurer in consideration of a certain premium, either in a lump sum or by other periodical payments, agrees to pay the assured, or to the person
for whose benefit the policy is taken, the assured sum of money, on the happening of a specified event contigent on the human life or ta the expiry of certain period. Thus, teh insurance company undertakes to insure
the life of a person in exchnage for a sum of money called premium.
Fire Insurance:
Fire insurance is a cotract whereby the insurere, in consideration of the premium paid, undertakes to make good any loss or damage caused by thye fire during a specified period upto the amount specified in the policy. Normally the fire insurance policy is for a period of one year after which it is to be renewed from time to time. The premium may be paid either in lump sum or in instalments. A claim for loss
by fire must satisfy the two folllowing conditions -
(i) There must be actual loss; and
(ii) Fire must be accidental and nonintentional
Marine Insurance :
A marine insurance contract is an agreement whereby the insurer undertakes to indemnify the insured in the manner and to the extent thereby agreed against marine losses. Marine insurance
provides protection against loss by omarine perils or perils of the sea. There are three types of marine insurance:
(i) ship or hull insurance
(ii) cargo insurance
(iii) freight insurance