general Insurance

1. General Insurance

2. General Insurance - Definition
 The class of insurance which does not involve
death as the main risk. It includes home, auto
and many specialized commercial risks such as
aviation, marine, boiler, etc. Also called "P&C"
or "Property & Casualty" insurance.
 It is also called non life insurance

3. Principles of General
Insurance
 When the insured pays premium and the insurer accepts
the risk, the contact of insurance is concluded. The policy
then issued is an evidence of contact.
 The contact is completed when the proposer makes an
offer and the insurer accepts the offer. The insurance
cover note is treated as an acceptance of the offer.
 The consideration for the insurer is the premium paid by
the insured and for the insured is the indemnity promise
made by the insurer
 The people entering in to the contact must be competent
and authorized to enter into contacts
 The purpose of insurance should not be against public
policy

4. Insurance & Assurance –
Difference
 a life insurance policy provides cover for a set
period of time. If the worst were to happen
during that time (and there are no
complications), then the insurance company will
be required to pay out the agreed sum to the
beneficiary. The only time the policy has any
real monetary value is if there is a claim made
for payment as a result of an event triggering
that claim, such as the death of the person
covered. If the person outlives the term of the
policy, then the insurance policy will cease and
no payment will be made.

5. Insurance & Assurance –
Difference
 Life Assurance is different from insurance, and will
always result in a payment. This is achieved by
combining an investment element along with and an
insured sum. This means that over time the value of the
policy can increase as the investment bonuses are
added. If a person covered by life assurance were to die,
then the insured sum would be paid out, alongside the
investment bonuses which would have accrued over
time. If it is necessary to cancel the policy prior to the end
of any designated term period, or the death of the life
being covered, then once an investment bonus has been
added, the life assurance policy will have an encashment
value. It is therefore possible to cash in a policy earlier
than its usual termination date, in order to collect on the
investment portion. It should be noted that many
insurance companies place penalties for cashing in
policies early.

6. Main Types of General
Insurance
 Health Insurance
 Liability Insurance
 Motor Insurance
 Marine Insurance
 Property Insurance

7. Health Insurance
 Individual/ Family Mediclaim Policy
 Domiciliary Hospitalization
 Family Floater
 Deferred Mediclaim Policy- For Retired Persons
 Small Covers for Lower Income Groups
 Cancer Insurance
 Group Mediclaim Policy- Employer
 Overseas Medical Cover- Journey Abroad

8. What is a Family Floater?
 Family floater is a privilege offered to the client
only in case he opts for "Group Mediclaim
Policy". Unlike in an Individual policy, where a
family (Husband/Wife) is covered for the
desired Sum Assured , independent of each
other, and pays the premium accordingly, in a
Family Floater-The employees family is covered
for a fixed amount and anyone in the family can
avail/get Advantage till the limit is exhausted.
The premium payable is calculated on the
employee's age and a 20% loading is charged
for every added person of the employees'
family.

9. Individual / Family Mediclaim
Policy - Hospitalization
 Policy covers both hospitalization and domiciliary hospitalization
expenses, as also treatment injuries caused by accident -
boarding expenses, surgical fees, anesthetist fees, consultant’s
fees, nursing expenses, OT Charges, diagnostic charges,
medical appliances charges
 To be eligible the claimant must be hospitalized for a minimum
period of 24 hours. However , in case of Chemotherapy, Eye
Surgery, Dental surgery, Kidney stone removal the condition
can be waived
 Expenses incurred 30 days prior to hospitalization and 60 days
after hospitalization could also be covered
 Claim amount cannot exceed the assured sum
 First year exclusion of pre-existing diseases

10. Mediclaim Policy - Conditions
 Available to persons between 5 and 80 years of age.
Children below 5 years can be covered if one of the
parents is covered concurrently.
 10% discount is available if entire family is covered
 Sum assured is increased by 5% for each year of claim
free insurance, subject to a maximum accumulation for
10 years.
 Provision for health check up every 4 years
 Final claim must be filed within 30 days of completion of
treatment
 Sum assured- Rs.15,000 to Rs.5 lakhs - Domiciliary limit
up to 20% sum assured – Premium Exempted under 80D

11. Cash Less / Reimbursement
Claim Settlement by TPA
 Cash Less – TPA pays to the Hospital
Concerned
 Reimbursement – TPA pays to the insured
 TPAs are private Third Party Administrators
who operate for several insurance companies
and place their representatives at important
hospitals for facilitating client services. They
scrutinize the claims and make payment on
behalf of insurers.

12. Deferred Mediclaim Policy
 Can be taken at any age between 25 and 55 or 60
( whichever is the retirement age)
 The amount of total benefit can be maximum of
Rs.50,000 during the life time and can not exceed
Rs.20,000 for illness or injury
 Policy does not cover pre and post hospitalization
expenses
 Policy comes into effect only on retirement
 Policy allows for a suitable refund of premium in case of
premature death of the insured
 The insured can increase the amount of cover anytime
until 4 years prior to retirement in multiples of Rs.10,000

13. Small Covers for Low Income
Groups
 Sum assured is limited to Rs. 5000 and the
premium is very low
 Works like a usual mediclaim policy but does
not offer cumulative bonus or medical check-up
facility

14. Cancer Insurance
 Two group policies one by Indian Cancer Society (ICS)
and the second by Cancer Patients’ Aids Association
(CPAS) are available. Sum assured are Rs.50000 and
Rs.2,00,000 respectively
 The Insured has to be a member of either of these two,
Viz., ICS and CPAS.
 Both policies require Cancer Check- up prior to taking
the policy
 Policy covers only allopathic mode of treatment including
cost of diagnosis, biopsy, surgery, chemotherapy,
hospitalization and rehabilitation.

15. Group Mediclaim Policy
 Available to any corporate, associate or a group of
persons
 Policy holder is the group and the premium is paid by the
group. Individual members may enter or exit the group at
any point of time
 Cumulative bonus and health check-up facility not
available
 The insured is required to give complete list of persons
covered under the policy from time to time
 No change in sum assured is possible
 No refund for a person leaving

16. Overseas Mediclaim Cover
 It covers medical expenses for illness suffered or
accidental injuries sustained by Indians when traveling
abroad on a work or for a holiday
 Accompanying spouse and children who are going
abroad will be treated as going for holiday travel
 Cover is available up to 70 years of age. Beyond 70
years are admissible at extra premium
 Policy does not cover pregnancy / childbirth, cosmetic
surgery, routine physical examination
 Policy covers various forms of treatment related
expenses and also expenses of air transport of the
remains in case of death and burial / cremation in India

17. Long Term Care Insurance
 It is the delivery of medical and personal care other than
hospital care to people suffering from chronic diseases. Due to
improved medical services, the mortality rates have come down
and people are living for longer time than before
 Elderly people after reaching certain age do not remain in a
position to take care of themselves and thus require long term
care.
 Thus long term care is an area of financial planning which
should not be neglected
 Premium would depend on family history, availability of caring
members in family etc
 The person should select this policy when he is healthy at 50 or
60 when he has other family members available to take care of
him/ her

18. Disability Insurance
 This insurance helps when the sole earning
member of the family becomes sick / disable for
an extended period
 Employers provide this facility at advantageous
rates
 It is voluntary and the premium has to be paid
by the insured
 Insurance Company pays monthly up to 60% of
monthly salary
 Cover can be taken for a short period or for a
life time

19. Liability Insurance / Indemnity
Policies
 Employee Liabilities : Those related to working
conditions and are covered under workmen's
compensation insurance policies
 Employee State Insurance : covers injury to an
employee while at work
 Non Industrial Risks : Risks faced in case of
commercial ( non-industrial) enterprises such
as Cinemas, Restaurants, Offices, Shopping
Complexes, Schools, Exhibitions & Fairs etc

20. Liability Insurance
 Professional Liabilities : Liabilities arising out of
practice of a particular profession. Doctors,
Engineers, Architects, CAs, Directors of
Companies, Lawyers and solicitors are covered
under this group
 Product Liabilities : These are liabilities that
could arise from the sale of products to
customers and resulting damage to any
customer due to a fault in the product.

21. Motor Insurance Covers
 Any liability arising in respect of death or bodily injury to
any person including the owner of the vehicle or his
authorized person in the carriage
 Damage to any property or third party ( man on the
street)
 Liability incurred in respect of death or bodily injury of any
passenger of a public service vehicle
 Liability arising out of Workmen’s compensation act – to
Driver / Conductor / Cleaner
 Liability to Hired / contact employees ( Drivers etc)

22. Motor Insurance
 Injured party / Insured will not have to prove any fault in
order to claim the amount under this policy. This is known
as “no fault” liability
 Sum limited is Rs.50000 in case of death, Rs.25000 in
case of permanent disability and Rs. 6000 in case
damage to property
 There are two types of policies : 1. Third Party Liability
Policies or the “Act Liability” policy and 2. Comprehensive
policy or Own Damage & Act Liability Policy
 The insured’s liability for damage to property of third
parties is limited to Rs.6,000, while liability for death of or
bodily injury to third party is unlimited.

23. Motor Insurance
 The legal costs and expenses by third parties are also
reimbursable in certain cases
 The risk covered under comprehensive policy are fire,
burglary, earthquake, flood etc, terrorist activity,
malicious acts, riot & strike etc
 Exclusions include mechanical breakdown, wear & tear,
depreciation, damage of tyres etc
 No claim bonus is provided while paying annual premium
 Premium is paid only on the depreciated value
 In case of commercial vehicles, the insured has to bear
Rs.1500 in respect of each accident compulsorily. Such a
practice is called Compulsory Excess and deducted from
claim for repairs

24. Marine Insurance ( Household
Goods in Transit)
 Item wise details of goods with their original purchase
price and date of purchase to be mentioned at the time of
getting the policy
 Damage should be reported on receipt of goods on
damaged condition to the transporter
 Insurance company also should be informed to appoint a
surveyor immediately
 Surveyor would inspect damaged goods and take their
photographs showing the nature of damage
 An estimate each to be obtained for the cost of repair of
partially damaged goods and replacement of fully
damaged goods net of scrap value / salvage valuefrom
carpenters, scrap buyers

25. Marine Insurance
 Based on this estimates the surveyor would make an
assessment of damage and provide a survey report
indicating the amount of claim which could be admitted
along with his own survey charges.
 The insured has to then lodge a claim on the transporter
for the assessed amount and get his acknowledgement
 The insured would send to the insurer original policy, bill
of lading, invoice of goods, survey report, claim bill, letter
of subrogation etc
 The insurance company would settle the claim after
getting an acknowledgement of the insured

26. Property Insurance
 Home Insurance covers natural and
man-made calamities.,
Fire, Earthquake, Lightning, Floods,
Explosion of gas cylinder, Spread of Fire
due to short-circuit ,Riot, Strike,
Malicious damage, Aircraft laws, Impact
from rail/ road vehicles, Storm, Cyclone,
Flood, Landslide, Burglary & Terrorism

27. Property insurance
 The value of a home structure is assessed as
per the area of home multiplied by the rate of
construction per. sq. feet, as on the date of
taking the policy. For example, if your home is
1000 sq. feet and the construction rate per sq.
feet is Rs. 800/-, then the sum insured for your
home’s building structure is Rs. 8,00,000.
On the other hand, the contents are assessed
on the market value of the items. This means
that if there were a loss, the claim would be
paid on the value of purchasing a similar new
item, less depreciation for the usage.

28. Property Insurance
 A comprehensive Home Insurance policy
also covers :
Household appliances, Jewellery
Furniture & fixtures, Personal items at
your home Against fire and allied perils
like earthquake, terrorism and burglary.
 The premium can be lower if you insure
for a long period ( 10 years) by making
one initial payment

29. Property Insurance
 Property should be insured for full value.
Otherwise the insurance company will settle the
claim only proportionately
 The principle is known as “coinsurance”. If the
property is not fully covered, the insured will be
regarded as a coinsurer and bear a part of the
loss.
 Willful negligence not covered

30. Tata AIG to Insure HNIs’
Jewellery & Valuables
 Tata AIG General Insurance has launched “Jewllery &
Valuables” insurance through its home insurance
products. This product is mainly targeted at high net
worth individuals (HNIs). The insurer has designed a
special division called private client group, which would
be offering these services. Whether it is their fleet of
high-end cars, homes, fine art, jewellery, rare antiques or
just about anything else they value, the company aims to
insure every aspect of their private collection. This
product would also reimburse loss of value occur during
repair and restoration of its clients’ valuables.

31. Thank You