Different Forms of Insurance everyone must know
1. Motor Insurance:
All private and public vehicles can be insured under motor insurance. These policies cover risk of theft, damage, floods etc. In case of damage of the Vehicle the insurance company compensates such loss. Motor insurance policy covers loss to third party also.
A third party is a person who or whose vehicle is involved in an accident and who lodges a claim for this loss. For example, A gets his car insured under third party claim. As car is involved in an accident with B or his vehicle. B lodges a claim for damages against A.
The insurance company will bear the claim of B on behalf of A because he had got third party claim policy. Under Motor Vehicles Act in India it is compulsory for the owner of every fuel driven vehicle to get a third party risks insurance policy. A vehicle owner may take a comprehensive policy which covers all the risks.
2. Personal Accident Insurance:
Under personal accident policy the insurer promises to pay a sum of money to the insured or his legal representative in the event of his death or disablement in an accident. A person can take this policy himself or an organisation which has an insurable interest in him can purchase this policy on his behalf. The loss in this policy must be accidental and not attentional. The term ‘accident’ has been defined as ‘an unlooked for mishap or untoward event which is not expected or designed.