Insurance Glossary: Auto, Life, Home and Health

Change is the essence of life. Even when transient, it can often leave behind long-lasting effects. Have you taken steps to protect yourself and your loved ones from the tumbles and jolts that life throws up, now and again? Wouldn't you be more at peace, if you knew that there was provision for financial support for you and your family, in times of distress?

Which is why, insurance is a necessity, and should ideally form an important part of any financial plan. It provides the economic security needed to tide over some of life's unforeseen and devastating moments. Insure now, rather than later. For it pays to be prepared when, and if, the unexpected happens.

The amount and type of insurance you need depend on your sources of income, your goals, and number of dependents, your debts and your lifestyle. Insurance can be bought from independent agents, exclusive agents, insurance brokers or directly from insurance companies that sell their products online or through a toll-free telephone service. Some of the major insurance policies are for life, health, home, auto and business. Additional policies include those on disability, long-term care, mortgage, travel, dental, and vision insurance.

Life Insurance

The two main types of life insurance are term and permanent. The former is for a specified period of time whereas the latter is life long. Beneficiaries receive a specified amount of money on the death of the insured person.

Health Insurance

Indemnity plans, health maintenance organizations (HMO), preferred provider

organizations (PPOs) and point-of-service plans (POS) are the four main types of health insurance. Policies can be obtained individually or through employers or by enrolling in Medicare or Medicaid.

Home Insurance

Basic, comprehensive or special home insurance policies protect the home, its contents and personal assets of the homeowner against losses from accidents and thefts.

Auto Insurance

Comprehensive and collision policies provide protection against losses suffered due to auto thefts and accidents. Additional policies for protection against liabilities from bodily harm, property damage, non-insured drivers and medical payments are also available.

Business Insurance

Depending on the nature and scale of business, policies provide protection against risks and contingencies. Business owners' policies for small and mid-sized businesses include property insurance, business interruption insurance and policies for protection against liabilities.