Life Insurance, Fire Insurance and Marine Insurance

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Introduction to Insurance

In today’s world everyone prefers to be insured. Having an insurance what of life or of business, both is required in the world full of contingencies. Life Insurance is having the life insured of the policy maker upon his death. Fire Insurance is the insurance against any loss caused due to fire to the policyholder. Marine Insurance covers cargo losses of the policyholder caused to the ships or other cargo vessels due to any accidents in the water bodies.


In this section we will know about the policies which are now utmost after a huge investment is invested in these properties. 


What is Fire Insurance and Marine Insurance?

Fire Insurance is a type of property insurance which covers the damages or the losses that are caused due to accidental fires. Mainly the policies insure about the fire protection but business owners or the particular property owners might purchase additional coverage in case their property is damaged by the accidental fire. Purchasing this additional fire coverage, covers the need of cost of replacement, repair, reconstruction of property. Else, war, nuclear risks are all excluded from this policy though.


Marine Insurance is defined as the insurance provided to the goods that are being dispatched from the country of origin to the country of destination. This insurance arose from international trading which occurred through the sea. Whatever be the origin, but marine insurance covers all modes of transportation of goods, whether air or water. Insurance is mandatory at times in trade, the exporter or the importer pays the insurance cost on the shipment as being mentioned in the terms of the contract.      


Difference Between Life Insurance and Fire Insurance

In our previous section we were introduced to fire insurance, in this prevailing section we will further delve into the meaning of Life Insurance.


Life insurance is to have the life insured. It is the financial protection provided to the policyholder’s family in case of death caused to the policyholder. This is like a payment made to the policyholder for fulfilling the policy term. In return for this payment on death of the policyholder, first he needs to make fixed payments to the life insurance company. 


In certain types of illness, there is no benefit provided by the life insurance company to cure the illness of the policyholder while in certain others they provide the benefits. 


Now, we will head on to learning about the difference between Life Insurance and Fire Insurance. The highlighted difference between Fire Insurance and Life Insurance is that fire insurance covers the losses caused to the properties of the policyholder whole life insurance covers the loss of death to the family of the policyholder. Nevertheless, the difference chart is provided as under – 


Parameter of Comparison

Fire Insurance

Life Insurance

Definition

An insurance of contract between the promisor and the policyholder, that insurance shall be assisted to the policyholder in case of fire related accidents.

An agreement to insure the life of any client or employee or personal self, this takes up the obligation to pay a sum to the family of the deceased.

Insurance Holder

Fire Insurance is taken up by companies.

Life Insurance is taken by a person for his own self life.

Duration 

Fire insurance covers a short duration like one year.

Life Insurance is taken for an uncertain period, till the time of the policyholder’s death. 

Compensation

Compensation is to be provided only if there is any fire accident

Compensation here is provided on the maturity of the policy or in the time of the policyholder’s death whichever occurs earlier.

Policies

Only a single policy is to be taken, yet there is a possibility of double policy. 

As many as policies are taken.


Insurance Proposal: Fire Insurance Marine Insurance Suggestion

Marine Insurance covers the losses caused due to accidents to the ships, terminals and any transport or cargo by which goods are transferred, acquired or held in the points of transmit. The term is also applied to inland marine but moreover is used in ocean marine linked with foreign waters. Insurance lowers the risk of any losses thus it is a benefit for transporters and shipping corporations. Marine Insurance is a safe policy as the transporters are assured about claiming damages in case of any mishap.  

FAQ (Frequently Asked Questions)

1. What is Meant By the Term ‘Insurance’?

Ans. The term ‘Insurance’ means to be insured from against any contingencies. Insurance is very popular nowadays due to its necessity. There are many types of Insurance – Life Insurance, Fire Insurance, Marine Insurance, Motor Insurance etc. The insurance is done to cover the losses that have occurred due to accidents.

2. Are Life Insurance Personnel?

Ans. Yes, life insurance is personnel. It is an insurance done on the life of the policyholder. Life Insurance is not recorded in the books of accounts also, they are deducted as proprietor’s drawing as the life insurance is of the proprietor or the business owner which is his personal expense.

3. Why is Fire Insurance and Marine Insurance Provided?

Ans. Fire and Marine Insurance is mainly provided to the business property. Big business houses are prone to certain accidents, like a fire breakout or even a leakage at sea which might cause loss of goods being transmitted to the destination hub. Hence, in regard to this fire insurance and marine insurance is done.

4. Why is Life Insurance Agreed for?

Ans. Nobody can predict their own term in life, hence to protect the family from financial loss after the death of the Karta of the family, the Karta, may agree to the life insurance policy where he is required to pay a fixed sum of money at regular intervals which will be paid as compensation by the insurance company upon the death of the policyholder.