What is insurance?

Insurance is a contract between the policyholder and the insurer where financial protection or reimbursements are given to the insured in case of any unforeseen circumstances. There are many types of insurance policies – life, health, motor, travel, and term insurance. During the policy’s duration, policyholders are required to pay premiums, often monthly, quarterly, and annually. You have to choose a policy based on the insurance coverage you need.

Benefits of Insurance

There are lots of benefits to buying insurance policies. Listed below are some of them.

• Financial protection: Insurance policies provide financial protection during a crisis. It not only provides monetary reimbursements but also reduces stress arising out of the situation.
• Wealth creation: Insurance policies like UPIPs give you investment benefits and help with your financial goals. You can withdraw a part of your premium whenever you need to.
• Saving habits: Most insurance policies come with insurance-cum-savings or insurance-cum-investments schemes. They encourage individuals to save by paying premiums that act as a guard during the crisis.