Insurance is an integral part of any sound financial planning but most people miss out on this aspect unless it’s a legal obligation, like motor insurance. Moreover, life insurance still enjoys little space in long-term planning but general insurance like a health insurance plan or something as important as a home insurance policy is done away with. This is basically due to lack of information and awareness. Here, we attempt to turnaround this very situation.
General Insurance is basically a contract where the insurance company promises to pay an agreed amount of money to the other party, i.e. the person being insured, on the occurrence of a stated loss other than death. So it won’t be wrong if we say that any insurance contract that doesn’t come under the ambit of life insurance is termed as general insurance. There are multiple types of insurance policies such as health insurance, motor insurance, and travel insurance which one can choose to secure his/her valuables like home, vehicle, etc.
Types of General Insurance
While life insurance pays a certain amount to the beneficiaries after the death of the policyholder, general insurance protects the financial losses and damage to the policy holder’s valuables and assets. General insurance or non-life insurance can be classified in the following categories:
- Health Insurance
- Motor Insurance
- Travel Insurance
- Home Insurance
- Crop Insurance
- Commercial Insurance
Health Insurance
The health industry in India is blooming manifold and with the availability of sound healthcare, there is a rise in the cost of availing the same. A health insurance plan aims to provide aid whenever a medical situation arises.
Broadly, there are two types of health insurance – individual and family floater.
- Individual Health Insurance
An individual health insurance policy offers financial aid to an individual when he/she gets hospitalized. Such an insurance policy covers only the individual and does not provide aid to the family members of the policyholder. One can opt for extra care health insurance policy if your existing health insurance cannot combat your medical expenses.
- Family Floater Policy
A family floater policy is designed to provide medical insurance to all the members of the family regarding any stated health issue. This type of health plans works just like an individual health plan, the only difference is the provision of insurance for all the members of the family and not just the policyholder. The plan works as an umbrella for the entire family. A family floater plan proves economic too as compared to a separate health plan for each family member.
Motor Insurance
Whenever someone buys any type of automobile, it is legally compulsory to back it with valid motor insurance providing at least third party liability coverage. While third-party coverage is compulsory, it is always recommended to go for a package policy that provides protection to the owner of the vehicle too.
There are 3 types of plans, viz.:
Two-Wheeler Insurance: For two-wheelers like scooter or motorbike
Car Insurance: For registered private cars
Commercial Vehicle Insurance: For vehicles used for other than private purposes
A motor insurance policy provides coverage against
- Third-party liability
- Damage to the vehicle of the policyholder due to
- Natural disasters like flood, fire, hailstorm, etc.
- Man-made risks like theft, burglary, etc.
- Personal accidents to the owner-driver of the vehicle
Home Insurance
Home is considered to be the biggest asset of one’s life. More valuable the asset, higher would be the investment done on it. Investing in a home insurance policy is a sound decision to make if one wishes to protect his/her asset. Home insurance proves to be the backbone protecting against the unpredictable damage that may hamper your house. Just like you protect your loved ones, home insurance shall protect your home.
- Home insurance provides protection against theft, burglary, terrorism, natural disasters like flood, earthquake, etc.
- It provides protection to the structure of the house along with the contents of the house
- It pays for the cost of construction, not for the cost of the land on which the building is standing upon
Travel Insurance
Even after making a proper plan for your trip, there are chances that you may encounter emergency medical situations, baggage loss, or expenses regarding a delay in the flight or any other mode of transport chosen. This is when travel insurance comes into the picture. Many insurance providers offer a range of travel insurance plans from which you can select from according to your requirement.
- There are various types of travel plans like a student plan, domestic travel plan, senior citizen travel plan, and Schengen travel plan
- Travel insurance provides coverage against loss of baggage and personal documents, emergency medical expenses, repatriation of human remains, etc.
- Usually, a travel insurance plan can be for anyone more than 91 days; for senior citizens plan, one must not be older than 85 years of age while for a student plan, the age limit varies from 16 years to 40 years
Commercial Insurance
Commercial insurance provides protection against the risks related to any business. There are different types of commercial insurance plans available like commercial vehicle insurance, shopkeeper’s insurance, mobile insurance, marine insurance, property insurance, employee benefits insurance, etc.
- For any commercial insurance policy, regular wear and tear or wilful negligence falls out of the scope of coverage
- Loss due to war or war-like perils is not covered
- There are various companies that provide commercial insurance like HDFC ERGO, New India Assurance, Bajaj Allianz and Bharti AXA General Insurance to name a few
- Underestimation of property is one common mistake done by many people. Doing this may save some amount here and there but might cause a major loss in case of an unfortunate event
General Exclusions
Cases, where general insurance cannot be claimed, are:
- For general wear and tear of the insured object
- Loss or damage to the insured object as a consequence of war or war-like situation
- Damage due to involvement in life-threatening activities
- Loss or damage to a house that is acquired illegally or a building aged more than 30 years
- Manufacturing defects
List of General Insurance Companies in India
Below is the list of all the companies providing general insurance policies in India:
|
General Insurance Companies in India |
|
| New India Assurance | Raheja QBE General Insurance Company Ltd- Raheja QBE |
| Reliance General Insurance | Star Health and Allied Insurance |
| SBI General Insurance Company Ltd. | Royal Sundaram General Insurance Co. Limited |
| Oriental Insurance Company | Religare Health Insurance |
| Tata AIG General Insurance | ECGC (Export Credit Guarantee Corporation of India) |
| United India Insurance | Manipal Cigna Health Insurance Co. Ltd. |
| Shriram General Insurance Company Ltd | Future Generali India Insurance Company Ltd |
| Universal Sompo General Insurance | Cholamandalam MS General Insurance |
| TATA AIG General Insurance | IFFCO Tokio General Insurance Company Limited |
| Apollo Munich Insurance | Bharti AXA General Insurance |
| HDFC ERGO General Insurance | Agriculture Insurance Company of India |
| Max Bupa General Insurance | Bajaj Allianz General Income |
| National Insurance Company Limited | Liberty General Insurance |
Importance of General Insurance
While a life insurance policy takes care of your family and loved ones when you’re not around, general insurance helps in leading a life which is risk-free. Below are few points elaborating the importance of general insurance:
To avoid car damage expenses
If you have insured your car, you do not need to worry about the costs of the damage occurred. You can claim your insurance amount to pay for your loss.
To cover hospital bills
General insurance can cover your hospital bills if you have bought health insurance. You can also avail of additional health insurance policies if the insurance money is insufficient.
To secure property
With the full range of choices from various types of insurance, you can select the one or many to safeguard your family as well as your assets. The general insurance financially protects your property from any damage.
To secure business
The general insurance plans include a policy to protect the property and anything related to your business. This can save you from facing massive financial loss due to natural calamity.
FAQs
Q1. I have a life insurance policy. Do I need a general insurance policy too?
Life insurance is very different from general insurance. General insurance aids in living a financially aided risk-free life whereas a life insurance policy provides a financial cushion to the dependents of the life insured when he/she is not around. Thus, having a life insurance policy does not alter
Q2. I rent a room in an apartment. Can I take home insurance?
Yes. You can take home insurance for your belongings in the house. Companies like ICICI Lombard provide this facility.
Q3. How to get the best valuation of a property?
Valuation of the contents of the house must be done on the prevailing market prices.
Q4. Is no claim bonus transferable?
Yes. No claim bonus can be transferred while shifting policy from another insurance company.