6 FAQs about General Insurance
February 17, 2021
The pandemic has brought Life Insurance to the forefront, with many people realising the importance of this financial product. Along with the rising demand for Life Insurance, its counterpart - General Insurance - has also been at the receiving end of the spotlight. People are growing more aware of General Insurance and of Health Insurance in particular.
Starting off at the basics can help you understand all about General Insurance, like Travel Insurance plans, Health Insurance Policies, Home Insurance and more. To make things clearer, here are the answers to some of the Frequently Asked Questions (FAQs) about General Insurance.
1. What is General Insurance and what are the different kinds of General Insurance?
General Insurance is essentially Non-Life Insurance. It offers protective coverage for assets other than life. Depending on the kind of asset insured, there are different kinds of General Insurance, such as:
- Health Insurance, which insures the health of the policyholder
- Home Insurance, which covers residential properties
- Vehicle Insurance, which covers automobiles, cars, and other kinds of vehicles, depending on the specific terms of the policy
- Travel Insurance, which insures the policyholder against several mishaps/accidents that could occur during travel
2. When should I purchase a Health Insurance Plan?
Health Insurance Plans offer a cover that helps you meet the costs of medical emergencies. Since such medical emergencies can occur at any point in life, it is always a good idea to invest in Health Insurance policies as early as possible. Ideally, it’s a good idea to purchase a Health Insurance plan when you’ve landed your first steady job. That way, you can promptly pay your premiums when they are due, and you can enjoy the benefits of a medical cover too.
3. What does Travel Insurance cover?
Travel Insurance covers a host of insurable incidents. The exact roster of instances varies from one plan to the next. But broadly speaking, here’s what you can expect a Travel Insurance plan to cover:
- Personal accident cover
- Hospitalisation expenses
- Trip delays, cancellations or interruptions
- Loss or damage to baggage checked-in
- Loss of passport
Some Travel Insurance plans have exclusive clauses that specify how events like accidents sustained in adventure sports may not be covered. It’s best to read the terms and conditions to know exactly what incidents your Travel Insurance plan includes.
4. Are there any tax benefits associated with Health Insurance?
Yes, Health Insurance does offer tax benefits to the investor. Specifically, Section 80D of the Income Tax Act, 1961, allows the premiums paid for Health Insurance plans to be deducted from the total income of the Assessee. This has the effect of reducing the total taxable income, thereby reducing the tax burden. The limit of deduction depends on whom the policy is purchased for (whether for self, family or parents), on the age of the purchaser and on the age of the parents. Senior Citizens get higher limits of deduction.
5. Can I buy General Insurance online? And is it safe to do so?
Buying General Insurance online is certainly possible. In fact, a number of insurance service providers, including ICICI Bank, offer the option to avail of General Insurance coverage online. And while we’re on this subject, it’s not only safe to buy General Insurance online, it’s also beneficial in a number of other ways. The advantages of buying insurance online include quicker and easier application, lower premiums and the ability to read the documentation first-hand.
6. What is the eligibility criteria for purchasing General Insurance?
The exact eligibility criteria for General Insurance depends on the kind of insurance you are looking for, the terms associated with the policy and the insurance provider you choose. Different kinds of insurance pose different insurance eligibility criteria. For instance, Health Insurance policies may contain age limits and require you to undergo a medical examination. Travel Insurance may come with eligibility criteria related to the nature of travel. To truly understand the eligibility criteria, it is best to read the terms and conditions of the policy carefully.
This should give you a fair idea of what General Insurance is all about. You can choose from many different kinds of General Insurance, depending on the asset you wish to insure. In each category of General Insurance, you can further select from among different insurers and a variety of insurance plans. All in all, it’s easy to customise your insurance cover as per your needs, given the range of options in the market.
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