Which of the following are the two main types of insurance policies?

The two main types of insurance policies are broadly classified as property insurance and liability insurance. Property insurance provides coverage for owned physical assets against risks such as theft, fire, or natural disasters. This type is crucial for protecting the financial investments individuals and businesses make in their tangible assets.

Liability insurance, on the other hand, offers protection against claims resulting from injuries and damage to people or property. It covers legal costs and payouts for which the insured party may be held responsible, ensuring that individuals and businesses can manage the financial repercussions of lawsuits and claims made against them.

These categories encompass a wide range of more specific insurance types, providing foundational coverage options that address both the protection of physical possessions and the potential financial risks associated with bodily injuries or property damage to others. Understanding this distinction is key for anyone studying insurance, as these two pillars form the core framework of most insurance policies available in the market.