What Is Personal Insurance?
December 18, 2016
Personal insurance is a type of insurance cover that protects the life and property of an individual or person against the risk of loss, harm or damage due to natural and/or unforeseen events or contingent reasons. The insurer or the insurance company undertakes the responsibility or liability to compensate or indemnify the insured party for the loss and damage caused to his life or his property and personal belongings due to various reasons that will be covered in the insurance policy. The insured party pays the insurer or the insurance company a certain sum of money, called the premium amount, for a certain period of time as per the terms and conditions of the personal insurance contract.
Some of the common types of personal insurance are:
- Life insurance
- Motor insurance
- Accident and health insurance
- Home insurance
- Travel insurance
What is life insurance?
Life insurance is the most common and important type of personal insurance available today. It is the protection given to the life of a person and compensates or indemnifies the relatives and dependents of the insured party on the death of the insured. The value of a person cannot be determined in monetary terms so there are various types of insurance policies available and the amount of premium payable depends on upon the party who is getting insured. He can assess his net worth himself and determine a suitable premium amount for himself and can pay the same to the insurance company.
What are the advantages of life insurance?
- Risk cover – life is full of uncertainties and unforeseen circumstances so life insurance ensures that your loved ones will be well taken care of even after your demise.
- You can plan each stage of your life – life insurance not only insures your life but provides financial support in each and every stage of your life, like your children’s education, marriage, building a home, retirement, etc.
- Covers health-related expenses – some life insurance policies provide health and medical insurance cover along with them and pay for hospitalisation bills, medicines and expensive lab tests and scans for treating critical ailments and diseases.
- Induces the habit of saving – a life insurance policy will inculcate the habit of saving for you, especially if you are a spendthrift. Any insurance policy will require you to pay a certain amount of money periodically towards the policy as premium and this acts as long term savings in the bank.
- Assured income during retirement – life insurance helps in retirement planning and provides a steady source of income during your years of retirement when you are not able to work and earn an income.
Allegiance is an insurance company in Singapore that deals with various kinds of personal insurance as well as professional indemnity insurance in Singapore.