Understanding Non-life Insurance Policies Better

What is it?

Growing up, all we have been hearing is life insurance, but it is equally important to know about the other forms of insurance that play vital roles in our physical and mental well-being. Whether it is life or non-life, buying an insurance policy means protecting yourself from losses in the future. While life insurance refers to permanent and term life policies, all non-life insurances fall under general insurance and cover people, properties and legal liabilities. Non-life insurance broadly includes marine insurance, fire insurance and miscellaneous insurance.

How it works?

Individuals or businesses can suffer huge loss from the damage to their physical things if they are not appropriately insured. Non-life insurances provide financial protection to the policy holders for health, building, machinery, equipment, vehicle, furniture and merchandise items against the risk of fire, accident, earthquake and theft etc.

What it Includes?

Fire Insurance

Fire insurance provides financial compensation against the damage or loss of physical goods or properties due to fire. Basically, it’s a contract between the insurer and the insured wherein the former promises to pay a certain amount of money to the latter in case of loss of properties caused by a fire incident within a set period of time. In return, the insured pays the amount of premium in consideration. The policy holder can claim either the value of goods damaged by fire or the amount insured, whichever is less.

Marine Insurance

It is a contract between the insurer and the insured, wherein the insurer provides financial compensation for the loss of ships, boats, terminals and most importantly, the cargo carried in them in return of the premiums paid by the policy holder. It covers different risks like accident of ship, collision, barratry, jettison etc.

Miscellaneous Insurance

Miscellaneous Insurance refers to all kind of non-life insurance policies other than the fire and marine insurance. The below are some common types of miscellaneous insurance:

Motor Insurance

Anyone who owns a motor car tends to get his vehicle insured in order to stay away from surprising hits on his wallet and mind. In this kind of insurance, the policy holder gets financial assistance from the insurer in case of loss of the vehicle, accident, theft or other unforeseen incidents and agrees to pay premiums in return.

Health Insurance

Health insurance is becoming rapidly popular in India due to the skyrocketing costs of medical treatment. It protects the insurer from paying the full or a part of the costs of the medical services he/she avail depending on the policy he/she holds. There are several types of health insurance. These insurances may be attained for the policy holder and his family through a private insurer, an employer, or the Govt.

Home Insurance

This general insurance policy provides an all-encompassing protection for your home. Home insurance gives you the benefit of affordable coverage for your belongings and properties against almost any eventuality. The policy you choose decides the exact terms. However, most home insurance policies cover perils like thunderstorms, hail, fire and theft.

Employer’s Liability Insurance

This is a kind of insurance that is made for the employees/workers of organisations or factories by the employer to compensate the claim of the workers in the event of accident, injury, disability and death while they are at work.

Travel Insurance

Travel insurance is a kind of insurance that covers the costs and losses related to travelling. It is useful for both domestic and abroad travelers. Nowadays, many companies selling tickets or travel packages offer customers the option to purchase travel insurance.

Conclusion

Non-life insurance policies are important because the peace of mind they give us at the time of need is far more valuable than the money we spend to purchase the policies. Corporates may opt buying corporate insurance which includes several policies and covers various operational risks like financial losses, theft, employees’ health benefits and accidents. And for individuals, it is advisable to have at least home, health and auto insurances besides the most important life insurance; so that they and their family are protected against any unexpected financial loss.

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