What is Type 1 and Type 2 coordination protection electrical?

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Type1 Protection- To protect your equipment from short circuit and you will have to change/repair your protection device. 

I am trying to describe in most simple words.

Type1 Protection- To protect your equipment from short circuit and you will have to change/repair your protection device. 

Ex- Fuse, Change it once you have used it once. You cant just reuse.

In fuse this thin wire simply melt and break contact. Either change wire (that is more difficult) or change fuse.

Type2- You can use this type of protection for short circuit protection again and again with simple manual reinstallation. 

Ex- Relay, Once you have used it, contact "CB" is open and now you can connect it again manual and use it again.

As you have asked about working,

There is a fault occured at point "F" (short circuit), Now large amount of current started flowing from "bus bar" to "F". Due to this sudden change in current, Flux are induced in "CT", that induced Emf in "Relay coil",

Relay coil attracts contact in Trip circuits. Batteries are pre installed in Trip circuit, Now current have started flowing and that produce emf in "trip coil".

Trip coil attract contact "CB" and now our job is done.

 Circuit has been broken, no current is flowing through it. our equipments are saved from SHort circuit.

As spring is attected to relay contact, it move back and break contact automatically.

Only "CB" is to be made contact manually ( by button or handle). Your Type2 is ready to work again.