General Insurance

Any kind of insurance which is not life-insurance comes under general insurance; it provides financial protection against loss or damage to an asset. Read on to understand more about general insurance.

Words: Sangeeta S

People mostly opt for general insurance only when it is mandatory, say like the car insurance; but insuring your assets can give you protection against uncertainties in life. When we look around we find more and more people opting for Life Insurance compared to General Insurance. Fair enough, one values life more than assets.
But at the same time if you can protect your others assets and valuables too like your home, jewellery, household items etc. then why not? After all life is full of uncertainties and there are possibilities that you may lose/damage your assets due to theft, accident, flood, earthquake, fire, storm…the reason could be any. And there comes the role of General Insurance; it provides you financial protection against any calamity which could risk your assets and valuables. In fact there are covers which even protect you against any cost you incur on legal actions.
The options are plenty; based on your requirement you can select the kind of cover you would need. It is very different from Life Insurance and mostly these are annual contracts which you need to renew every year. The claim is only in case of any event like health issues, theft, fire etc. or else there are no returns as such.
Let us explore few of the general insurance covers available.

Motor Insurance
It is mandatory to get motor insurance as per the Motor Vehicles Act, 1988. It is up to you to opt for the kind of coverage you want – Third Party Liability Cover is

mandatory while Comprehensive Motor Insurance Policy is optional. Going for a third party mandatory cover will not cover your own loss; it covers only third party. Comprehensive covers include both your car as well as the third party and therefore it is definitely a better option.

Health Insurance
This covers you against any expenses made related to health. Plans are many; some companies even customize the plan based on your requirement. You can opt for reimbursement plan or go for cashless facility in the designated hospitals. There is a huge market for this; but make sure you understand the policy well before you sign the dotted line. Understand your personal requirement first and then opt for the one most suitable to you. There are various covers available like comprehensive, floater, individual, surgery cover etc.

Home Insurance
Home Insurance gives protection to your house and even the assets in your home. Broadly it offers two options – one is protection to the structure and second is for the contents. The insurance gives you fire and peril cover, protection against natural and also against man made calamities. Fire and peril cover includes protection against fire, lightning, earthquake, aircraft damages etc., while protection against natural calamities include flood, storm, cyclone etc. Theft, riot, etc. are covered under man made calamities. It does not include damage due to wear and tear, pollution or war.

There are special covers also for your special needs and you may opt for special covers.
Travel Insurance
Travel insurance covers unexpected situations like flight delay, loss of passport or baggage, accidental death, hijack distress and most important medical emergencies. Whether it is business or vacation, travel insurance should not be missed. Any kind of financial emergency can also be covered under travel insurance. It has various categories like student, international, domestic, senior citizen etc. For travelling overseas it is mandatory to get travel insurance done. Read the fine print and understand well what all benefits you can avail as a part of this cover.
Besides these there are also other general insurances which cover the commercial sector. They provide insurance to industries, businessman and others related to industries. The industries include all like textiles, aviation, logistics, pharmaceutical, construction etc. Then you have Marine or Cargo Insurance, rural insurance etc.

Claim Process
Now once you have taken any kind of general insurance it is important that you understand well the benefits you can get and also the claim process. Due to lack of knowledge and awareness many times the claims get rejected. Different insurances have different claim process. Some have time frame, while for some you have to provide evidence. Be fully aware of the entire procedure and all the documents you would need to file your claim.

Expert Questions
To understand the Legal aspect of “General Insurance”, we spoke to our expert Preeti Jha, Associate Advocate with Legal Consultus, a New Delhi based law firm. She has wide experience in advising and handling Insurance matters.

Q. Who should buy general insurance?
A. As the foremost benefit of having a General Insurance is that it safeguards against unexpected loss to the assets and properties of an individual. Hence, any person, who owns an asset, can buy insurance to protect it against losses due to fire or theft or damage etc.

Q. How to buy respective general insurance policy and from whom?
A. There are many options available in the Insurance market. It is important to take basic precautions at the time of purchase of Insurance Policies. Most important is to purchase the policy from Insurance Regulatory Development Authority (IRDA) approved Insurance Companies. Also look for the one having the office/branch office in the proximity for the early reporting of the damages. The same is very important factor in order to claim insurance coverage as the law mandates for the early assessment and inspection of the quantum of damages by the Insurance Surveyors.

Q. What are the appropriate legal remedies available in case of any grievance or deficiency of service on the part of the Insurance Company?
A. Insurance policies are contractual obligations between the respective Insurance Company and the policy holder. Hence, the terms and conditions of the policy have to be strictly adhered to by both the policy holder as well the respective insurance company.
Write to the Insurance Company and give them sufficient time to respond suitably. If they don’t respond, or if the response is not satisfactory, then you can approach for the appropriate legal remedies.

For complaints relating to personal insurance covers up to a value of Rs.20 lakh, you may approach the Insurance Ombudsman in your area. It should be one of the preferred forums for the adjudication of grievances as the ombudsman has a technical team that will go into the merits of each and every case.
The ombudsman has to pass an award within a period of three months from the receipt of the complaint. The award is binding upon the insurance companies.
In case the policy holder is not satisfied with the award of the ombudsman then he can approach another legal forum in accordance with law for redressal of his grievances. An aggrieved policy holder can also lodge a complaint before the IRDA against such Insurance Company.

Q. What is the role of Insurance Regulatory and Development Authority (IRDA)
A. The Insurance Regulatory and Development Authority (IRDA) is a statutory body established under the Insurance Regulatory and Development Authority, 1999 with the intent to protect the interest of the policy holders.
It is the duty of the regulator (IRDA) to ensure that the constituents of conventional general insurance contracts conform to basic standards, and also that the terms used in the general insurance contract are unambiguous and easy to understand.
This is extremely important keeping in view the large number of complaints received of late pertaining to unfair trade practices such as misrepresentation, discrimination, inducements, and failure to maintain records. It defeats the very purpose of a beneficial scheme intended to help the common poor. It is also imperative on the part of the regulator to formulate a code of conduct for the insurance agents. The same is essentially required since unfair practices and misconduct by insurance agents/insurance intermediaries like surveyors form a large chunk of the complaint cases.