According to Wikipedia, Insurance is the equitable transfer of the risk of a loss,
from one entity to another in exchange for payment, known as Premium. It is a form
of risk management, primarily used to hedge against the risk of a contingent, uncertain
loss. Individuals and Institutions face different types of risks in their life cycles.
Risk management, the practice of appraising and controlling risk, has evolved as
a discrete field of study and practice. While not all of these risks are controllable,
some of these can be managed through the concept of pooling of similar risks.
Insurance plans or policies are divided in 2 categories. They are life and general
insurance. Life Insurance provides a monetary benefit to a decedent's family
or other designated beneficiary, and may provide for income to an insured person's
All Non-life Insurances fall under General Insurance, which cover all related
costs of the insured as well as his/her belongings. For instance, a Passenger Car
Insurance covers your car; Health insurance covers your health, Home Insurance covers
your home and its contents and a Travel Insurance policy insures you against untoward
events during the travel. .
What are the advantages of General Insurance?
General or Non-Life Insurance offers you two kinds of distinct benefits:
- A General Insurance policy cover reimburses the insured for a financial loss caused
due to certain events as stated in the respective general insurance policy.
- It gives you peace of mind during loss and covers major portion or total loss.
This depends on the type of policy and the sum assured value of the respective General
With medical inflation estimated to be running in double-digits, costs for medical
procedures have gone up substantially in the last one decade. Imagine being in a
situation when you or someone in your family needs to get admitted to hospital for
a medical condition that you were never prepared for. There are cases where people
abstain themselves from medical treatments due to the exorbitantly high medical
costs of treatments and medicines. However, a general insurance in form of a Health
policy saves you from such expensive medical costs.
When one takes a Health Insurance plan, the company provides the insured with
a safety cover. In simple words, the insurance company takes care of your treatment
costs during the period of insurance. The company after you buy the policy from
them will be liable to reimburse you whether partially or fully for the treatment
cost as stated in the policy. A Health Insurance policy plan can save more than
80% of total cost which is an enormous savings! In certain cases, insurance is mandatory
by the law. For instance, you cannot drive any vehicle without a valid auto insurance
policy as per the Motor Vehicles Act 1988 in India.
Some of the non-Life Insurance plans that are important for individuals are:
an automobile is more of a necessity and not a luxury. Any person who drives a motor
car tends to get his car insured. Car insurance is like a long-term covering the
various damage costs which might occur due to unforeseen incidents. Car insurance
is just what you need to maintain your car's lovely lustre and stay away from
surprising hits on your wallet and mind!
A passenger car policy covers the damage costs which might happen to your car
due to any kind of accident. Driving a car without proper car insurance is illegal.
Hence, having a Car Insurance is pre-requisite to be able to drive your car.
: A Health Insurance covers various health issues and related medical costs. The
details about whether the policy covers existing illnesses and what diseases it
will cover and how much sum assured value, are listed in the policy document. Hence,
read the policy documents carefully before taking one. Carefully examine that all
your requirements are covered and confirm the same personally with the concerned
insurance company personnel. It is important to understand the fine print and to
be aware of what is not covered in a Health Insurance policy.
: This is another common type of general Insurance policy. Home Insurance policy
provides an all-encompassing protection for your home. Your home is your prized
possession and it must be given the most trusted protection it deserves. A home
Insurance gives you the benefit of affordable coverage for your property and possessions
against almost any eventuality.
HDFC ERGO General Insurance Company provides a range of non-life insurance products
for individuals as well as institutions (including the large companies and small
& medium enterprises) that are comprehensive and affordable. Wherever it is
technically possible, HDFC ERGO provides option to individuals to purchase the product