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Sunday, 26 June 2011

Difference or Distinguish between Life insurance and Fire insurance



We can distinguish between life insurance and fire insurance under the following heads :

1. NATURE OF CONTRACT :-
Life insurance : Life insurance is not the contract of indemnity.
Fire insurance : Fire insurance is a contract of indemnity.


2. DURATION PERIOD :-
Life insurance : Life insurance covers larger duration.
Fire insurance : Fire insurance duration is from 1 years to 10 years but it is renewable.


3. CREDIT FACILITY :-
Life insurance : Against the life insurance policy credit can be obtained.
Fire insurance : Against fire insurance policy credit can not be obtained.


4. TAX CONCESSION :-
Life insurance : In case of life insurance sometimes income tax concession is granted.
Fire insurance : In case of fire insurance income tax concession is not granted.


5. NATURE OF EVENT :-
Life insurance : The event of death which is considered the base in the contract of life insurance is death which is certain.
Fire insurance : In the fire insurance event fire is uncertain. It may take place or may not take place.


6. SECURITY AND INVESTMENT :-
Life insurance : Life insurance possess the element of security and investment both.
Fire insurance : Fire insurance includes the element of security only.


7. TITLE :-
Life insurance : The word Assurance is generally used along with life policy due ti its certainty.
Fire insurance : The word insurance is used along with fire due to its uncertainty.


8. INSURABLE INTEREST :-
Life insurance : Insurable interest must exist when insurance policy is taken but no need at the time of loss.
Fire insurance : Insurable interest must be present at the time of fire policy taken and at the time of loss.


9. DOCTRINE OF SUBROGATION :-
Life insurance : In the life assurance it is not applicable.
Fire insurance : In case of fire insurance it is applicable.


10. SHARE IN PROFIT :-
Life insurance : In a life insurance insured person also takes the share from profit.
Fire insurance : In case of fire insurance nothing is paid excess from insured amount.


11. TRANSFER OF LOSS :-
Life insurance : In case of loss insured person can not transfer the loss to insurance company.
Fire insurance : In case of fire insurance loss can be transferred to insurance company.


12. SURRENDER VALUE :-
Life insurance : Life insurance policy has a surrender value after three years of its existence.
Fire insurance : Fire insurance does not have any surrender value.


13. DETERMINATION OF PREMIUM :-
Life insurance : The life insurance policy premium determination is very simple and do not change
Fire insurance : Fire insurance premium rate changes according the change in risk.


14. CLAIM LIMIT :-
Life insurance : In the life assurance after maturity whole of the assured amount becomes payable.
Fire insurance : In fire insurance case only the actual value of the property destroyed by fire can be claimed.

6 comments:

Jeni Rose,  15 March 2014 at 04:31  

its really helpful thank you soooo much....keep going....

Khushi,  24 September 2016 at 23:34  

Really,it's very simple and understanding answer.

Kiran sapkota,  23 February 2017 at 02:36  

It is easy to read n understand.... Tq so much

Life Insurance Terms 13 November 2017 at 02:33  

If you get injured, you will need to report it to the insurance service provider and give information about the loss. You can go for injury claims if you are injured by an auto accident or any other method. Usually, the injured person would be asked to submit medical reports to the insurance service provider. The claims are settled as a single lump sum.

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