Difference between life insurance and general insurance

A contract that covers any risk save the danger of death is known as general insurance, also referred to as non-life insurance or property and casualty insurance. The purpose of insurance is to protect ourselves and our possessions, such as our home, automobile, and other assets, from hazards like fire, theft, flood, storm, accident, and earthquake.

These are indemnity contracts, in which the insurer guarantees to compensate the insured for any losses. Therefore, the insurance company will compensate the insured for their loss regardless of the policy's coverage amount. Since they are typically one year in length, they must be renewed annually. General insurance comes in the following forms:

There are three types of life insurance, discussed:

• Whole life assurance: With whole life assurance, the policy's pay out only goes to the nominee or the insured's legitimate heir after the latter passes away.

• Term life insurance: In this type of insurance, the policy amount is paid to the nominee in the event that the insured dies before the specified term has expired or to the insured himself when the term has come to an end.

• Annuity: After the policy's term expires, the policy's face value is paid to the holder on a recurring basis for as long as the insured is alive.

Definition of General Insurance

A contract that covers any risk save the danger of death is known as general insurance, also referred to as non-life insurance or property and casualty insurance. The purpose of insurance is to protect ourselves and our possessions, such as our home, automobile, and other assets, from hazards like fire, theft, flood, storm, accident, and earthquake.

These are indemnity contracts, in which the insurer guarantees to compensate the insured for any losses. Therefore, the insurance company will compensate the insured for their loss regardless of the policy's coverage amount. Since they are typically one year in length, they must be renewed annually. General insurance comes in the following forms:

• Fire insurance: This type of insurance protects against the possibility of property loss from fire.

• Sea insurance: This type of insurance protects the owner of the ship or the cargo against loss resulting from marine mishaps such as shipwrecks, stranding, and collisions.

• Health insurance: It protects against the danger of illness or injury to the policyholder's or his or her family members' health.

• Home insurance: The protection of a home's structure and contents against unforeseen events.

• Motor insurance: Motor insurance, which is broken down into two heads, namely two-wheeler insurance and four-wheeler insurance, covers the insurance of vehicles.

DIFFERENCES BETWEEN LIFE INSURANCE AND GENERAL INSURANCE

 1. Maturity benefits: Because life insurance provides maturity benefits after certain tenures, it can be considered an investment in addition to insurance. Most of the time, general insurance only guarantees a reimbursement amount in the event of a loss brought on by unforeseen circumstances. It rarely offers maturity advantages.

 2. Premium payments: In the case of life insurance, a set sum is typically required to be paid yearly for a predetermined period, such as 10 or 20 years. When purchasing a general insurance policy, the entire premium is typically paid all at once.

3. Policy Tenure: In contrast to general insurance, a life insurance policy's duration is often long-term.

 4. Function in financial planning: Money for a child's education, a retirement fund, etc. can all be invested in through life insurance. Your belongings are only safeguarded by general insurance against any emergencies.

 5. Insurance Claim Amount: For life insurance, the assured amount is paid either upon the death of the insured person or upon the policy's maturity. In the case of unlucky events, general insurance provides compensation for the loss in accordance with the terms and conditions of the policy.

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