Understanding General Insurance Policies, Types & Premiums

When it comes to financial planning, choosing the right investment avenue is critical. These investments are based on your future goals, and hence, ensuring they meet your financial target is essential. But apart from choosing the right area to invest, ensuring the protection of such investments is equally important. Insurance is a way to go ahead. While insurance plans do not directly safeguard such investments, they are a tool to ensure that your investments need not be liquidated before their goals are met. Wondering what is general insurance In India, insurance is classified into two broad categories of life and non-life insurance plans. While life insurance is straightforward and deals with your life, general insurance is an umbrella term that includes different categories of insurance plans. It includes health, motor vehicles, travel, home, commercial businesses, and others. Thus, everything that is not life insurance is categorised as general insurance. While the general insurance landscape is broad, it can be a daunting experience for a first-timer to figure out which insurance cover fits them right. Considering the different needs of an individual, different policies can be availed. The narrowing down of the options requires in-depth knowledge of what you are getting for yourself. This article aims to simplify the different types of general insurance plans and help you understand their significance.

Motor insurance

Motor insurance is the only type of insurance policy that is mandatory by law. The Motor Vehicles Act of 1988 lays down this requirement and non-compliance attracts hefty penalties. As a vehicle owner, you need not buy it just for legal compliance, but also to avail the different benefits it offers. Financial protection against damages is one such benefit, wherein liabilities due to a third person or the damages to your own vehicle, are covered under the insurance policy’s scope. A motor insurance policy is mandatory for both two-wheelers as well as four-wheelers, irrespective of private use or commercial use. Motor insurance is further available in two types of covers—a third-party liability cover or a comprehensive cover. While the third-party coverage is the minimum required insurance coverage offering protection for legal liabilities, a comprehensive plan provides protection against damages to your vehicle too.*

Health insurance

With medical expenses soaring sky-high, it is necessary to seek medical coverage for the treatment costs. A health insurance policy is the way to ensure a financial shield against these soaring costs by way of different insurance covers, like an individual plan, family floater health insurance, group insurance policy, senior citizen cover, critical illness cover, etc. Each policy is designed for a specific use and hence, choosing them wisely is essential.*

Travel insurance

Unexpected situations during your travels can mean disruption of the entire travel plan. It can either be a medical emergency or even by way of loss of baggage and other similar situations. With travel insurance by your side, you no longer need to worry about these snags in your travel.*

Home insurance

A home is the single largest investment for most individuals, and any damage to their house can mean a debt trap to get it fixed. Thus, a home insurance policy comes in handy wherein financial protection is offered not just for the damages to the structure of your home, but also for the contents within them. The premiums for all the above policy are not based on a single factor, but a combination of many factors acting at once. For instance, the vehicle’s cubic capacity, age, insured declared value, etc., are some elements that impact motor insurance premium while the beneficiary’s age, lifestyle conditions, and policy coverage, are some that impact health insurance covers. So, the next time you are buying a general insurance plan, make sure to use an insurance calculator to estimate the impact on your premium. *Standard T&C Apply Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms and conditions, please read sales brochure/policy wording carefully before concluding a sale.