What Are the Essential Points To Consider When Buying General Insurance in India?
Everyone tells you to have some kind of security in your life physically and financially. And the first idea of financial security for most people is insurance. Hence, you are always advised to buy insurance fromevery family member, relative and friend. As good as this advice is, no one will talk to you about the different types of insurance available to you. It’s like someone sent you to the market without telling you what to buy. So, it is your responsibility to know what type and how much insurance coverage you can get.
There are two broad classifications of each type of insurance sold. There is life insurance and general insurance. Life insurance is very self-explanatory. However, do you know what general insurance is and how is it different from life insurance? If you have to purchase general insurance, you need to know what it is first.
What is general insurance?
The insurance sector in India is divided into two categories – life insurance and general insurance. While life insurance policies cover financial loss caused by loss of life, general insurance policies cover financial loss caused by loss of property. Therefore, general insurance covers the financial value or financial loss of a property due to certain incidents within the policy’s scope of coverage. General insurance has a variety of plans, each designed to cover specific losses.
Types of general insurance
Now that you know the answer to ‘what is general insurance?’, you should explore the types of general insurance. They include:
Health insurance is a type of general insurance that provides coverage for various expenses arising from medical emergencies. After purchasing this policy, you can get coverage from the insurance provider for any illness or injury that is within the policy coverage limits.
The most important part of planning a trip is getting travel insurance. Travel is an exciting and dangerous experience. But when you are abroad, a lot of things can go wrong and you may not be familiar with the territory to manage the situation successfully. For example, you may have a medical emergency or lose your valuables. Travel insurance protects you from such problems while traveling.
A motor insurance policy provides protection against various types of damage to your vehicle due to accidents, theft, vandalism, etc. This will cover your car repair in such a situation.In the case of loss of a vehicle due to theft or extensive damage, the policy will compensate you for the vehicle as mentioned in the policy documents.*
* Standard T&C Apply
Advantages of general insurance plans
General insurance plans are beneficial for the following reasons –
- General insurance plans cover you against any damage to property and compensate you in the case of a loss. Also, general insurance plans offer you financial protection even in the event of an emergency
- In some cases, general insurance plans are mandatory by law. For example, bike/car insurance plans are mandatory under the Motor Vehicles Act, 1988. This is done to ensure that drivers can be compensated for any damage or loss to their vehicles or themselves.
- General insurance plans can help protect your savings in an emergency. Therefore, you can use your savings to work towards your financial goals
- Health insurance plans, which are a type of general insurance plan, offer you tax benefits. The premium paid for such plans is allowed as an exception under Section 80D. This exemption will help reduce your taxable income, which will reduce your tax liability and help you save on taxes. Please note that tax benefit is subject to change in tax laws.
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.