Types of Insurance in General
Types of Insurance in General
Insurance is a financial product that provides protection for individuals or groups against specific risks. By paying insurance premiums, we can obtain insurance benefits in the event of unwanted circumstances such as accidents, illnesses, death, or property loss.
There are many types of insurance offered by various insurance companies in Indonesia. Generally, insurance types can be divided into two broad categories:
Life insurance is a type of insurance that provides protection for a person's life or health. Life insurance can pay a cash amount to beneficiaries or policyholders if the insured person passes away or experiences permanent disability due to illness or accidents. Life insurance can also provide additional benefits such as daily sickness allowance, medical expenses, hospitalization expenses, surgical expenses, and more.
Some examples of life insurance products are:
- Term life insurance: insurance that provides protection for a specific period, such as 10 or 20 years. If the insured person is still alive after the specified period, no benefits will be provided.
- Whole life insurance: insurance that provides lifelong protection for the insured person. If the insured person passes away at any time, the beneficiaries will receive the insurance payout.
- Pension life insurance: insurance that provides protection while also saving for retirement. If the insured person lives until retirement age, they will receive a monthly pension. If the insured person passes away before retirement age, the beneficiaries will receive the insurance payout.
- Unit-linked life insurance: insurance that combines protection and investment. A portion of the insurance premium is allocated to purchase selected investment units. The value of the insurance payout and the investment will vary based on the performance of these investment units.
Non-life insurance is a type of insurance that provides protection for property or economic interests of individuals or groups threatened by specific risks. Non-life insurance can pay compensation or repair costs in the event of damage or loss of insured property.
Some examples of non-life insurance products are:
- Motor vehicle insurance: insurance that provides protection for motor vehicles such as cars or motorcycles against the risks of accidents, theft, fire, or natural disasters.
- Property insurance: insurance that provides protection for properties such as houses or buildings against the risks of damage or loss due to fire, floods, earthquakes, landslides, or malicious acts of others.
- Health insurance: insurance that provides protection for the health of individuals or groups against the costs of medical treatment due to illness or accidents. Health insurance can cover outpatient care, hospitalization, surgeries, medications, and more.
- Travel insurance: insurance that provides protection for individuals traveling domestically or internationally against the risks of accidents, illnesses, flight delays or cancellations, lost baggage, or lost travel documents.
- Liability insurance: insurance that provides protection for individuals or companies responsible for losses or damages suffered by third parties due to their errors or omissions. Liability insurance can cover compensation or legal costs arising from third-party claims.
Those are some of the common types of insurance that you should know. Each type of insurance has different benefits and requirements. Therefore, before choosing an insurance product that suits your needs, it is advisable to study and compare various options available in the market.