General Insurance
Why choose a General Insurance policy?
Anything which has a value can be insured. In insurance term, any policy other than life is called “general insurance and includes among others, health insurance. In it’s normal form it includes the insurance of immovable and movable property against damage by causes such as fire, floods and other natural occurrences and burglary. In some cases, to facilitate business growth, it covers insurance against legal liabilities, errors and omissions by key persons in an organizations etc.
As to why it is needed, well it secures one’s interests against losses which may arise due to various reasons. We work hard and stake large sums on buying or gaining accesses to assets. If these were to be destroyed due to certain reasons, it would cause an immense loss to its owners recovering which could take a long, long time and may in some reasons, push a person permanently into a financially unstable position. In the case of legal entities, in some cases, it is mandated by law that persons at a certain position holding certain responsibilities ought to be ensured against certain losses.
On who should ideally buy a general insurance product, it is a well laid-down fact that anyone likely to be affected ought to buy the policy. This extends to family members and dependant relations who, if the incident occurs, shall be most affected. On the value of the insurance policy, it could either be the market value of the insurable interest or the cost of replacing the asset where it is lost, destroyed or otherwise adversely affected. The premium payable to gain such an insurance policy would depend upon such value of the policy.
On the types of policies which fall under General Insurance, it includes the following:
- Vehicle insurance:
Such policies provide protection to two-wheelers like bikes and scooters and four wheelers including cars, jeeps, SUVs, MUVs etc from third-party liabilities and physical damages from fire, theft, explosion, burglary, riots, strikes, earthquakes, flood, cyclones, accidents and malicious acts.It is advisable to acquire such an insurance policy as it brings confidence to its owners from knowing that they can limit their liability + it is also a statutory need to do so.
- Health/Medical insurance :
Medical emergencies are costly affairs which can set-back one’s finances by years. To obviate such occurrence, the only recourse is to invest in an effective medical/ health insurance cover of adequate amount from an insurer of repute. - Travel insurance :
Indians are getting ambitious. And the ambitious, travel. So do Indians! And they thus need travel insurance. Such policies cover cost of medical assistance abroad where the need so arises in an emergency. Where the emergency does occur, it is expected of the insured to check into any of the empanelled hospitals nearby. Besides helping out with emergency medical assistance, TI also helps with other benefits such as payments in case of flight delays/ cancellations, loss of baggage and/ or passport. In the event of the insured’s death, such policies also provide a certain sum to the nominee to make the latter’s travel and arrival into India easier. - Insurance of immovable property :
Immovable property may seem an asset that does not need any cover! Why, it does! What if your house is hit by a severe storm or torn apart in an earthquake or submerged (partially or wholly) by flood? And besides, a house can also be burnt or burgled into! Such a policy thus as a vast ambit from protecting the very asset to that of the interest of those living within (the latter can be against robbery, theft, break-ins etc.)
Myths about General Insurance
Like everything else we do in India, we generate myths rather convincingly! Like the following ones:
- I am young, I don’t need a health insurance
- My employer has a health insurance policy and that takes care
- My bank gives the best health insurance policy
- Health insurance is applicable only to those cases where you need to stay a minimum 24 hours in a hospital
- A INR 5 lakh cover is sufficient etc
- Old cars don’t need insurance
- NCB is lost when the car is sold.
- If my friend drove my car and met with an accident, his insurance policy will take care of my car!
- The colour and make of your car decides the car insurance premium that you shall pay!
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