Types of Insurance and Definition, How Important Is This?

There are several different opinions about the definition and types of insurance. However, they all refer to one general definition. In terms of insurance, it is an agreement between two or more parties. Where each party is the insured and guarantor.

Simply put, the insured party is the one who pays the premium or contribution. Meanwhile, the insurer in insurance is the one who provides services or compensation for losses. In general, insurance is included in the category of non-bank financial institutions. The goal is to minimize losses from the risks provided.

Common Types of Insurance Provided

These risks are classified into several types of insurance below. The meaning and types of insurance in Indonesia are quite diverse, starting from life insurance, health, vehicles, and so on. Several terms are often used in insurance such as premiums, insurance policies, and claims.

Types of Insurance and Definition

1. Education Insurance

The purpose of using education insurance is to ensure the continuity of education for children. Education insurance claims can be made by contacting the agent concerned. The reason is, that each agent often has different rules or regulations. You can also make a claim based on an agreement or a certain period.

2. Life Insurance

This type of insurance is very popular and often used. Life insurance is carried out to provide security for a person's life. In general, there are 2 methods for claiming insurance. First, funds are given after the insured dies. Second, funds are given before the insured dies (based on a period).

3. Vehicle Insurance

There are many types of vehicle insurance. Starting from focusing on covering injuries to other people, damage to other people's vehicles caused by the insured, as well as loss or damage to the insured's vehicle. The most common type of vehicle insured is a car.

4. General Insurance

There are 2 main types of insurance, social and voluntary. Social insurance is usually provided to ensure old age, using forced methods such as salary cuts. Meanwhile, voluntary insurance is a free premium payment method. If divided further, some voluntary insurance is run by the government and some is run commercially.

5. Property Insurance

The property that is often registered in this type of insurance is a house or other private residence. The aim is to reduce the risk if a disaster occurs such as fire, earthquake, or other things that result in damage to the property. The insurer will provide relief from damage to the house or property.

6. Business Insurance

This type of business insurance is very broad in scope. This could be in the form of protection against damage, natural disasters (earthquakes, floods, lightning), mass riots, and so on. This also includes protection for employees (health and life), investment protection, and so on.

7. Travel Insurance

The term of travel insurance is relatively short, namely when the insured leaves until he returns home. Meanwhile, the protection provided covers accident costs, compensation, medical treatment, repatriation of bodies, protection of luggage, and so on. You can find details regarding the agreement through a trusted insurance agent.

There are many more types of insurance, such as marine, credit, theft, transportation, and so on. You should discuss every detail of the insurance service with the agent concerned. If something is not clear, don't hesitate to ask until you understand. Starting from the premium amount, how to claim insurance, period, or other important special events.

That's all the information about the meaning and types of insurance that are popular and often used. In Indonesia itself, there are various kinds of insurance agents. For example, special guarantees within the scope of work, travel (accidents), health, and so on. Finding the right and trusted agent is very necessary.