A Comprehensive Guide To Non-Life Insurance Policies

Life can be unpredictable, and tragedies can come uninvited from nowhere. Certain unforeseen events, such as your bike breaking down, finding yourself in the middle of a road accident, or even worse, a burglary, can take place anytime. What can you do to financially protect yourself as much as possible from such uninvited tragedies? The simple answer - a Non-Life insurance policy. Let’s learn more about the types of non-life insurance policies that exist and dwell on their features and benefits as well. Read on to know more. But first, let us look into the exact definition of a non-life insurance policy.

What Is A Non-Life Insurance Policy?

Simply put, as the name suggests, a non-life insurance policy, or a general insurance policy, is essentially any kind of insurance policy other than a life insurance policy. Such insurance covers insure you from the financial damages associated with car accidents, natural calamities that could strike your home, or any kind of theft that might take place in your humble abode. The list is long. There is an insurance policy for almost everything that could go wrong in life.

Examples of Non-Life Insurance

Non-life insurance policies encompass a variety of coverages that justify the term’s meaning. Examples include homeowners insurance, motor insurance, marine insurance, and damage coverage for fire, natural calamities, theft, or travel mishaps. Cybersecurity incidents like online breaches can also be insured under these policies. Estimating damage caused by online incidents is challenging due to the unpredictable nature of such risks, but non-life insurance provides coverage for these scenarios.

What Are The Types Of Non-Life Insurance Policies?

There are several types of non-life insurance policies. They are:

1. Motor insurance (Two-Wheeler/Four-Wheeler/Commercial-Vehicle Insurance)
2. Travel insurance
3. Health insurance
4. Disaster insurance (Protects you from events such as floods, fire, and earthquakes, among others)
5. Credit insurance
6. Accident insurance
7. Mortgage insurance
8. Property insurance

What are the Features of Non-Life Insurance Policies?

Some features of a general insurance policy are:

1. A general insurance company typically gives you a policy that has a validity of one year. But you can always go for a policy that goes beyond the one-year mark as well.
2. The general insurance company is not liable to bear the entire cost of the damage at the time of claiming. However, the general insurance cover that you have purchased will take care of a significant proportion of the cost. You will be required to pay a nominal amount, which is known as the policy’s deductible.
3. You will need to pay the policy premium before the non-life insurance company issues you the policy.
4. When the insurer receives your policy application form, it will evaluate your case based on the appropriate parameters. For example, for a home insurance policy, things like the age of construction, its market value, and that of the valuables insured, will be considered.
5. If you do not make a claim during the coverage period, the insurer will give you what is known as a no-claim bonus. It is usually given away as a concession on the premium you pay, which increases constantly until it reaches a particular amount. The extent of the no-claim bonus is subject to the insurer’s discretion.
6. When you get your policy papers, you will see a section known as ‘Sum Insured’. This is essentially the maximum liability the insurer is willing to underwrite. The available ‘Sum Insured’ amount could be specified by the insurer in some cases.

What are the Benefits of Non-Life Insurance Covers?

The benefits of non-life insurance policies are as follows:

1. They can take care of most of the hospital costs in case you have an injury.
2. If you lose your luggage, or travel documents, or get into an accident while travelling abroad, an appropriate travel insurance cover can assist you during such times.
3. It can protect you from the financial liabilities associated with damaging someone’s vehicle or property with your car. Such insurance policies are known as third-party car insurance. You need to get such a policy as soon as you buy a new car, as it is mandatory by law. You can also go for a comprehensive car insurance cover, which will protect you as well as the third party from any mishap involving your four-wheeler.
4. Just like car insurance covers, you need to purchase an insurance policy for your two-wheeler, as well.
5. A home insurance policy can financially guard you against unwelcome events such as a burglary, fire, or a natural calamity to the extent of the sum insured.
6. As a business owner, you can also insure your manufacturing facilities, just like you can insure your home. You can also purchase insurance policies for your employees while you are at it. * Standard T&C Apply

Difference Between Life Insurance and Non-Life Insurance

Comparison Basis	Life Insurance	Non-Life Insurance
Definition	Protects against life risks, providing financial security for uncertainties like death.	Offers financial protection against asset damage or health issues caused by unfortunate incidents.
Policy Period	Long-term	Short-term
Nature of Policy	Considered an investment, not a contract of indemnity.	Functions as a contract of indemnity.
The Insured	Benefits are received by the policyholder or their beneficiaries.	Benefits are available to the policyholder and others insured under the policy.
Claims	Sum assured is paid at maturity or upon the policyholder's death.	Claims are processed based on the financial loss or damage incurred.
Cost of Policy	Depends on the sum assured.	Depends on the value of the insured asset.

Difference Between Participating and Non-Participating Life Insurance

Type of Difference	Participating Policy	Non-Participating Policy
Meaning	Offers a share in the insurer's profit.	Does not offer a share in the insurer's profit.
Bonus Payout	Annual bonuses or dividends.	Nil
Premium	Higher, due to potential profit-sharing.	Lower, as there is no profit-sharing.
Benefit	Dual benefits of insurance and profit-sharing.	Provides insurance coverage only.
Examples	Unit Linked Insurance Plans (ULIPs).	Term insurance policies.

How to Apply for Non-Life Insurance

To apply for a non-life insurance policy, you need to prepare basic details like your name, identity proof, residential proof, and ownership proof of the asset to be insured. Once you choose a suitable insurance company, submit your application or proposal to purchase the policy.

Importance of Non-Life Insurance Policy

Non-life insurance policies are crucial for the following reasons:

1. Financial Security: They provide protection during unforeseen financial liabilities.
2. Risk Transfer: The financial burden is shifted from the policyholder to the insurance company.
3. Peace of Mind: These policies offer relief from potential financial crises.

Inclusions of Non-Life Insurance Policy

The inclusions depend on the specific type of policy purchased. Examples include:

1. Motor Insurance: Covers third-party liabilities, own damage (comprehensive), and personal accident coverage.
2. Health Insurance: Includes hospitalization costs, minor surgeries, and ambulance charges.

Exclusions of Non-Life Insurance Policy

Common exclusions in non-life insurance policies are:

1. Raising claims when the policy is inactive.
2. Providing false or fraudulent information.
3. Not adhering to the stipulated claim process.
4. Missing the deadline to file a claim.

Things to Remember While Buying/Renewing Non-Life Insurance Online

1. Check Terms and Conditions: Review the fine print available on the insurer's website. Clarify doubts with the insurer before purchase.
2. Compare Plans: Evaluate coverage and costs across multiple insurance providers.
3. Buy What You Need: Avoid unnecessary add-ons that inflate premiums.

Step-by-Step Process to Renew Non-Life Insurance Online

Login to your account on the insurer’s website or app.

1. Select Policy: Choose the policy nearing expiration or already expired.
2. Adjust Coverage: Update required coverage and click “Renew.”
3. Review Terms: Go through inclusions, exclusions, and fine print.
4. Make Payment: Pay online to receive the renewed policy via email.

Why is it Important to Renew Non-Life Insurance?

Renewing your policy ensures uninterrupted coverage against unexpected financial liabilities. Non-life insurance policies are typically short-term, so timely renewal is essential to maintain protection and eligibility for claims.

How to Claim Non-Life Insurance Online

Filing a claim online is straightforward:

1. Contact the insurer to understand the required documents.
2. Login to your account and select “Raise Claim.”
3. Attach the necessary documents and submit the claim request.

Non-Life Insurance Claim Settlement Process

The insurer will review the claim, investigate the incident, and request additional documents if needed. After completing the evaluation, the claim will be settled as per the policy terms and conditions.

Documents Required for Claiming Non-Life Insurance

1. Proposal form.
2. Proof of age and address.
3. Medical examination report for health claims.
4. RC book for motor insurance.
5. Income proof.
6. Invoice of the insured asset.

Conclusion

A non-life insurance policy could prove to be your ultimate saviour when tragedy strikes. However, the size of the role it will play will depend upon your coverage. Hence, you must choose the non-life insurance cover that is best for you. If you are wondering which is the best general insurance company out there, look at the non-life insurance policies that Bajaj Allianz has on offer.   * Standard T&C Apply Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.