Insurance is the best financial instrument to cover the risk. There are a variety of insurance policies available at present. Those are like life insurance, auto insurance, fire insurance, health insurance, disability insurance, property insurance, and so on.
Based on the holding of the insurance companies, insurers are categorized into two types, namely, mutual insurance companies and stock insurance companies. Mutual insurance companies are owned by policyholders and stock companies are owned by stock holders.
Based on products the insurance companies are categorized into two types, those are life insurance and general insurance. When the company is doing business on life insurance, it is life insurance company. Other than the life insurance are called general insurance companies. If the company does business in only a specified insurance type, it is known as an insurer accordingly. For instance, when a company deals in marine insurance, it is a marine insurance company.
Now we are going to discuss the business model based insurance companies types. Those are as follows:
Life insurance companies:
Life insurance companies sell life insurance, pension products and annuities. These companies are mainly deals with long term and short term monetary investments. The plans are mature and benefit to the family members at the time of policyholder death. The term plans will mature after a particular period.
Non life insurance companies:
These are a different type of companies to life insurance companies. Non life insurance companies sell other than life insurance products or policies. These policies are mainly focusing on protecting property from many risks and natural calamities like floods, earthquakes, typhoon, lighting and fire etc. When the incident occurred the companies will pay the claim to the policyholder.
Composite insurance companies:
Composite insurance companies offer both life insurance policies, and non-life insurance policies to the customers.
Re-insurance companies:
These type of insurance companies sell their insurance products to the other insurance companies. These companies do this practice to reduce the risk and protect them from huge losses. Re-insurance market is dominating by a few large re-insurance companies with huge reserves.
Captive insurance companies:
Captive insurance companies can be defined as limited purpose companies. These are established by a single group of companies. Captive insurance companies main aim is of financing risks operating from its groups or parent groups. It is an in house self insurance vehicle for that group. The sponsors for captive insurance companies will enjoy the commercial, economic and tax advantages. Captive insurance companies are mainly helps in risks management.
Before choosing an insurance company, it is always better to check the company's background whether they are financially sound or not, history, owned, and the type of company.
Based on the holding of the insurance companies, insurers are categorized into two types, namely, mutual insurance companies and stock insurance companies. Mutual insurance companies are owned by policyholders and stock companies are owned by stock holders.
Based on products the insurance companies are categorized into two types, those are life insurance and general insurance. When the company is doing business on life insurance, it is life insurance company. Other than the life insurance are called general insurance companies. If the company does business in only a specified insurance type, it is known as an insurer accordingly. For instance, when a company deals in marine insurance, it is a marine insurance company.
Now we are going to discuss the business model based insurance companies types. Those are as follows:
Life insurance companies:
Life insurance companies sell life insurance, pension products and annuities. These companies are mainly deals with long term and short term monetary investments. The plans are mature and benefit to the family members at the time of policyholder death. The term plans will mature after a particular period.
Non life insurance companies:
These are a different type of companies to life insurance companies. Non life insurance companies sell other than life insurance products or policies. These policies are mainly focusing on protecting property from many risks and natural calamities like floods, earthquakes, typhoon, lighting and fire etc. When the incident occurred the companies will pay the claim to the policyholder.
Composite insurance companies:
Composite insurance companies offer both life insurance policies, and non-life insurance policies to the customers.
Re-insurance companies:
These type of insurance companies sell their insurance products to the other insurance companies. These companies do this practice to reduce the risk and protect them from huge losses. Re-insurance market is dominating by a few large re-insurance companies with huge reserves.
Captive insurance companies:
Captive insurance companies can be defined as limited purpose companies. These are established by a single group of companies. Captive insurance companies main aim is of financing risks operating from its groups or parent groups. It is an in house self insurance vehicle for that group. The sponsors for captive insurance companies will enjoy the commercial, economic and tax advantages. Captive insurance companies are mainly helps in risks management.
Before choosing an insurance company, it is always better to check the company's background whether they are financially sound or not, history, owned, and the type of company.
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