What Is Insurance

I've never heard anyone saying, "because of life insurance, we become miserable, " instead, I always hear this "because of life insurance our financial goals become easily attainable

David Angway

Insurance is basically a contract between an individual and an insurance company where the individual agrees to pay a fixed sum money of money monthly/quarterly/yearly to the insurance company and in return, the insurer agrees to indemnify the individual against any loss.

In other words, insurance is means of protecting yourself or any object against unfortunate loss.

There are various types of insurance plans available in the market today for consumers, therefore, it is prudent for investors to read about them thoroughly before investing.

Requirement of insurance: Financial security: If you are the sole working member in the family, or both partners are working and you have liabilities on you (for example- a home loan!), you would like to insure yourself against any tragic incident. So that, if anything unfortunate happens to you, your family doesn't have to bear the financial brunt. Insurance money provides a cushion for your family and saves them from other harsh difficulties. Legal Requirement: Third-party insurance is mandatory in the case of vehicle insurance so that if your vehicle is involved in an accident, the victim who has suffered a physical loss( loss of life/ limb, etc.) or financial loss (damage to the vehicle or other property) gets adequate reimbursement. Corporate insurance: Many corporates have started offering insurance to their employees so that in case of any unfortunate event, they face limited liability and the workers are compensated fully. Further, insurance is predominantly used in logistics sector to insure cargo against damage or theft.