Insurance is an agreement between two parties namely the insurer and the insured. Under this agreement the first party agrees to indemnify the loss suffered by the second party under special circumstances. In return the second party has to pay a certain amount called as premium. Insurance can be of many things ;life insurance, health insurance, fire insurance, etc

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There are various kind of insurance policies available in India. These include:

1. Term plan. A term plan is the simple and the best plan which provides full risk coverage. Under this scheme the person is insured fully till the insurance expires. For eg A person if dies within the time of insurance, then his legal heirs will get the full amount on the date of death whether the premium is paid in full or not. It is the most cheapest and the best plan

2. ULIPS ie units linked insurance plan schemes. Under this the dual advantage is there. The person get insurance as well as investment opportunity. The premium paid by the policy holder, half of it is invested in funds and the remaining amount is used as insurance premium. The policy holder can choose the funds in which amount can be invested offered by the insurance company. However the premium charged is usually high. And it is not advised to go for this plan.

3. Endowment funds: An endowment plan is a combination of insurance plus savings. A part of the amount is used for insurance purposes and the rest is invested. If the insured person outlives the maturity the various bonuses and incentives are paid to the holder. Sometimes these are paid at the time of maturity or sometimes at the regular intervals.

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4. Money back insurance policy. Under these schemes a sum of money is is returned to the holder at a regular interval as a surviving benefit. Thus some portion of the premium paid is returned to the holder and the holder is also eligible for certain benefits of the company.

All these are the major known insurance policies which are popular. Buying a term plan is the most advisable option.