TYPES OF INSURANCE 

There are many types of insurance depending on the subject matter. However, insurance may be broadly classified into two: (1) Life Insurance, (2) Non-Life Insurance 

1. Life Insurance - Life Insurance or Life Assurance is a contract under which the insurer or the assurer, in consideration of premium, agrees to pay to the assured or insured or to his dependants a certain sum of money on the expiry of a certain period or on the death of the assured whichever is earlier.

Nature

 Human life is the subject matter of a contract of Life Assurance. An individual may insure his own life or his ‘dependents’ life in which he has insurable interest. Like other a contracts of insurance, life Insurance contract is also based on the principle of utmost good faith. The assured is bound to disclose all the material facts known to him relating to his life. Life Assurance is a protection against the loss caused by the death of the earning member of a family. It is also a provision for the future because the lump sum of money to be received on the expiry of the period, will serve as an investment. 

1. Non-Life Insurance - Non-life insurance includes all those contracts of insurance wherein the subject matter of insurance is not human life. If can be classified further into General Insurance and Miscellaneous Insurance.

GENERAL INSURANCE 

The following are the three types of General Insurance;

a) Marine insurance - It is a contract of insurance under which the insurer undertakes to indemnify the insured against losses incidentally to marine adventure. It may cover loss or damage to the ship, cargo, freight, vessels or any other subject of a marine adventure.

b) Fire Insurance- Fire insurance is a contract under which the insurer agrees, in return for a consideration called the premium, to indemnify or compensate the insured for the actual loss caused to him by the destruction or damage to the insured property by fire. In case of loss by fire, the insurer will pay only the actual amount of loss, or the maximum amount specified in the contract, whichever is less. In short, in the event of loss, the insured will only be indemnified. The main purpose of a fire insurance contract is to protect the insured against the loss of his property by fire. A fire insurance contract is a contract of indemnity. It indemnifies the insured against any loss caused by fire. To get compensation for loss of property under fire insurance, it must be proved that the loss of property has arisen due to fire. It is also important the fire must be caused accidentally and not intentional

c) Social Insurance- Pension plans, disability benefits, unemployment benefits, sickness insurance and industrial insurance the various forms of social insurance. With increase in the Socialistic idea, the social insurance has become obligatory duty of the nation. It has been developed to provide economic security to the weaker sections of the society.

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