As one of the non-bank financial institutions, insurance is known as a good investment alternative and minimize the risk of unforeseen events. The definition of insurance under the web of the Financial Services Authority is an agreement between an insurer and an insured person who is required to pay a premium in order to provide reimbursement for the risk of loss, damage, death, and loss of expected profit, which may occur over an unexpected event.
This term illustrates that any action taken to provide protection against the threat of risk. The policyholder has an obligation to pay a sum of money called a premium to the insurer, which in turn agrees to compensate and protect against future losses that may be subject to the policyholder of the insurer. When a policyholder or an insured or insured participant suffers a disaster and gets a loss or damage to the contract, the insured has the right to file an insurance claim. The recipient of this insurance is not only the insured whose name is listed as the policyholder of the insurance company but also can be another person appointed directly by the insured.
Insurance itself is known in various types or kinds and grouped according to focus and risk. It is these foci and risks that determine the size of uniformity in the risk borne by the type of policy. This will be used by insurance companies to anticipate potential losses and set the premium rate offered in accordance with each type of insurance.
Here are the types of insurance:
1. Life insurance
This type of insurance is known to provide financial benefits to the insured for his death. A payment system for the type of life insurance was various. There are insurance companies that provide payment after death and others can allow the insured to claim funds before his death. Life insurance can be purchased for self-interest and on behalf of the insured only or purchased for the benefit of a third person. Even life insurance is also known to be bought on the lives of others. As an illustration, suppose a husband can buy life insurance that will benefit him after the death of his wife. Parents can also insure themselves against the death of the child.
2. Health Insurance
This type of insurance is also well known by the people of Indonesia. Health insurance is an insurance product that handles the health problems of the insured because of an illness and bears the cost of the treatment process. Generally, the cause of insured sickness that the cost can be borne by the insurance company is injury, disability, illness, until death by accident. Health insurance is also known to be purchased for the benefit of the insured only or the interests of a third person.
3. Vehicle Insurance
The most popular vehicle insurance in Indonesia is a type of car insurance that focuses on the dependents of injury to others or against damage to other people's vehicles caused by the insured. This insurance also can pay loss or damage to an insured motor vehicle.
Vehicle insurance is one of general insurance products. This type of insurance had become a boom when the May 1998 riots occurred because the event made public interest in the ownership of protection for private vehicles increased drastically.
4. Home and Property Ownership Insurance
As a valuable asset, usually, homeowners will protect themselves and their assets that can be either a home or a private property with home and property owners insurance. This insurance provides protection against any loss or damage that may occur on certain items of the insured's personal property.This insurance also protects and provides relief when the home or other property of the insured suffers a disaster such as a fire.
5. Education insurance
This is the most popular insurance and a favorite of policyholders. Educational insurance is the best alternative and the solution to ensure a better life, especially for children's education assets. The cost of the premium to be paid by the insured to the insurance company varies according to the level of education you wish to obtain later.
Understanding the importance of using education insurance for children is now something of concern to parents. The high cost of education and other conditions that worsen the economy such as the weakening of our currency against the US dollar affect the cost of education of children later. Realizing that this obviously will incriminate parents, so often parents now choose to have education insurance.
6. Business Insurance
This insurance is a protection service against the damage, loss, or loss in large quantities that may occur in one's business. This insurance provides replacement of damage caused by fire, explosion, earthquake, lightning, flood, hurricane, rain, crash, until riot. Insurance companies typically offer a variety of benefits from business insurance such as protection of employees as business assets, investment, and business protection, total life insurance to all employees, to health insurance coverage packages for employees.
7. General insurance
General insurance or general insurance is a protection against risks for loss or loss of benefits and legal liability to third parties. This general insurance coverage is short-term (usually about one year). General insurance can be classified into several types, including:
- Social Insurance (Social Security)
This type of insurance is an insurance that must be owned by every person or resident with the purpose of every person has a guarantee of old age. Premium payments are made by force, for example by cutting a person's salary every month.
- Voluntary Insurance (Voluntary Insurance)
This insurance is run voluntarily. This type of voluntary insurance can still be divided into two classifications: Government Insurance and Commercial Insurance. Government insurance is an insurance that is run by the government, while commercial insurance is an insurance intended to provide protection to a person or family and company of the risks that may arise due to unexpected events.
8. Credit Insurance
Credit insurance is a protection against the risk of failure of debtors to pay off credit facilities or cash loans such as working capital, trade credit, and others. Relation closely with banking services, especially in the field of credit. Credit is a loan in the form of money provided by banks and Financial Institutions as lenders to their clients. Credit insurance aims to protect banks or other financial institutions from the possibility of not recovering loans lent to customers and help provide guidance and credit security. Credit insurance managers in Indonesia entrusted the government to PT. Credit Insurance Indonesia.
9. Marine Insurance
This type of insurance is special in the field of a marine whose function is to ensure the carrier and the owner of the cargo. Risks that may occur so that the formation of this insurance is cargo damage, damage to the ship, and injure passengers. Marine insurance or naval insurance is a good risk transfer for yourself as well as your luggage using sea transport services. This insurance involves the use of shipping services in the delivery of goods. Several factors affecting marine freight insurance premiums are goods insured, packing of goods, insured risk, transportation, and travel.
10. Travel Insurance
Overall, the function of travel insurance is not much different from ordinary insurance functions as one form of protection to customers with a short time period as long as the premium buyer travels to return home. Benefits and protection to be gained from having travel insurance include protection and covering costs for accidents affecting premium buyers, personal accident compensation, emergency medical expenses, repatriation, medical evacuation, to the protection of luggage that has a lost risk or damaged.
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