Imagine taking your much-awaited vacation and constantly worrying about your home, car, and other belongings keeping you worried while you are on your trip. It is definitely not a vacation that you would enjoy. Instead, the constant worry will leave you wondering whether to check on your home or be in the moment. This is where a general insurance plan, different types of general insurance, and general insurance products come into the picture.
Different Types of General Insurance Plans in India
Similar to life insurance, general insurance also operates on the doctrine of a risk occurring to many people simultaneously. But not everyone who suffers from the risk faces the damage. This helps the general insurance companies with general insurance products honour your claims at a premium. A similar coverage is offered to others who are willing to insure for a similar type of risk. Insurance firms then offer pay-outs from this pool of funds when claims are made. Like life insurance, different types of general insurance plans ensure that you or your family receives the money when needed.
Good health is as important as your life. With numerous general insurance companies in India, selecting the right plan is critical. Health insurance policies cover unexpected hospitalization up to a specific amount of sum assured. You can choose from different types of health insurance depending on your need. For example, you can get insured using a critical illness plan if you have any genetic ailment.
A motor insurance policy covers any case of vandalism, damage, theft, or accident. A motor insurance policy ensures you have all-around protection for your car. Your car insurance can be customized using selective add-ons.
Have you ever lost your baggage while traveling far away from home? Yes, misfortunes happen. So, buying travel insurance is essential, particularly for international travel. The travel insurance cover takes care of any financial loss due to lost baggage or emergency case of hospitalization.
Commercial Vehicle Insurance
A commercial vehicle insurance policy covers damages and losses caused to or by a commercial vehicle and the owner/driver, including damages and losses in accidents, collisions, natural calamities, fires, etc.
As a property insurance policy to help cover your home, rented apartment, and personal belongings from unexpected situations such as fires, floods, burglaries, storms, and explosions. Investing in home buying is a vital aspect in the lives of those who spend all their time earning working for it. Yet, many of us forget about protecting and securing it. This is where home insurance comes into the picture.
Coverage Under General Insurance Plans
General insurance covers your home, travel, health, vehicle, and other non-living assets from natural or man-made disasters. Therefore, there are different types of general insurance policies and general insurance products, including health insurance, motor insurance, home insurance, and travel insurance. It is crucial to know all about different types of general insurance and how they can be leveraged. Let us explore them one by one –
Since our home is an invaluable asset, securing it with appropriate home insurance is crucial to safeguard it and its items. A home insurance policy like this provides coverage for man-made and natural circumstances that may result in damage or loss.
Motor insurance offers coverage for your vehicle against accidents, damage, theft, vandalism, etc. It is available to us in two forms – comprehensive and third-party. When your vehicle is responsible for causing an accident, third-party insurance takes care of the harm caused to a third party. However, general insurance policy types such as the comprehensive policy safeguard your vehicle against fire, impact damage, earthquake, theft, etc.
When you travel internationally and suffer losses because of loss of baggage, trip cancellation, or delay in the flight, a travel insurance policy protects you.
As a vital tool for risk mitigation, health insurance helps you deal with medical emergencies and covers hospitalization expenditures up to the sum insured.
How to Choose the Best General Insurance Policy?
Types of general insurance are agreements between the insured and the insurer. They are meant to secure you from the uncertainties of life. However, uncertainties may knock at your door without a prior intimation at any point in time. Hence, you must choose the best general policies per your requirements and compare various insurance plans. Therefore, it is essential to comprehend your requirements before looking up an insurance company.
- The types of General Insurance policies are non-life insurance policies.
- Apart from motor insurance, all general insurance policies are optional.
- All general insurance policies must be taken individually and follow their verification process.
How much do general insurance policies cost?
It depends upon the price you are willing to pay for peace of mind. For example, as per estimates, a 35-year-old man must pay only INR 2,620 monthly to protect his family’s financial future.
Health insurance premium
A family floater covering self, spouse, and one child will cost anywhere between INR 10,000 – 17,000 annually. For example, a plan costing INR 5 lakh will cost a 35-year-old INR 4,000-7,000 a year.
Motor insurance premiums
Car insurance in India begins at an average of about INR 2,400 per year.
Travel insurance premiums
As per estimates, the average cost of travel insurance is 5% to 6% of your trip costs. For instance, for a $5,000 trip, the average travel insurance cost is $228 or may cost up to $437 for generous coverage.
Commercial Insurance Premiums
Commercial insurance is a type of insurance that covers risks related to the setting up of a business. Various insurance policies help companies get financial coverage for various business risks.
Did you know?
There is a waiting period before pre-existing illnesses can be covered under health insurance. During this waiting period, the insurance will not cover any hospitalization arising from the pre-existing disease. If you fail to disclose the pre-existing illness when taking the policy, your claim can be rejected.
Home Insurance Premiums
Here are some factors that impact the home insurance premium –
- Coverage – The general insurance plan type you select, and the amount of sum insured impact your premium.
- Cost of Construction – Your home insurance premium depends on your property’s construction cost. The higher the price, the higher the insurance premium, and vice versa.
- Tenure – The duration of your home insurance policy also impacts the premium.
How to Buy General Insurance Plans?
Insurance applies to a large group of people who may suffer similar risks in the same circumstances or geographical region. The money collected as the premium can be called a pool; a person is paid from that pool when anyone faces a loss.
Online term insurance offers a higher sum assured as it comes with low premium costs and common morality risks depending upon the insurer’s age, habits, and income.
Offline term insurance also offers a significant sum assured but due to the high cost of premiums and agent’s commission, people generally go for a low sum assured.
The insurer offers a legal document to the policyholder that guarantees financial assistance in exchange for a premium. Nowadays, you can purchase online insurance quickly and conveniently from your smartphone.
Buying offline health insurance requires documentation. Some documents required include medical records, birth certificates, Aadhar cards, etc. In addition, you can access information about the insurer, for example, their claim settlement ratio, online.
How the General Insurance Claims Process Works
The claim settlement procedure is a very crucial service to the policyholder as well as the insurer. Claim settlement in general insurance can make the policyholder stay with the insurer. It is a method where the policyholder demands financial assistance from the insurer. Claim Settlement in general insurance plan types is provided only after the due procedure gets completed. Therefore, insurance companies must provide an easy settlement process to stay ahead in the market. Every policyholder wants to receive the claim amount quickly, so insurance companies want to offer their customers the most efficient claim service.
Policyholders are mainly concerned about claim settlement, whether it is a car insurance policy, travel insurance policy, or health insurance policy. They expect their insurance company to deliver prompt support during an emergency. A cashless claim implies you do not have to pay the hospital bill as the insurance company will settle it with the hospital.
A reimbursement claim means settling the hospital bill out-of-pocket and then applying for reimbursement from the insurance company.
Words to remember
- Sum Assured – the fixed amount that is paid when a claim arises.
- Act of God – refers to natural calamities that humans cannot control.
- Consequential loss – losses that occur because of an unexpected event.
In this blog, we hope we have answered all the queries about general insurance and the different general insurance plan types, including health, travel, home, and motor insurance.
Frequently Asked Questions (FAQs)
Today it is crucial to know about the different types of general insurance because of their numerous benefits. Read on to learn more about them: Home Insurance, Motor Insurance, Travel Insurance, and Health Insurance.
There is so much to consider when buying a life insurance policy, but the claim settlement ratio of the insurance company should be one of the crucial factors. Hence, it is necessary to make a well-researched purchase.
The taxpayer (individual/HUF) can claim a deduction under section 80D in respect of medical insurance premiums paid by him in any mode other than cash.
You can purchase online insurance quickly and conveniently online.
Most health insurance plans issue the policy without a medical test if you are aged below 45 years of age. However, for those aged above 45 years, a medical examination is required.