4 reasons why general insurance is incredibly important

12 May 2019

We all wish to live a risk-free life. We pray for the wellness our family members, our home and our worldly possessions. But praying for the wellness of everyone and everything we hold dear is not a practical approach. You should also be prepared in case something unfortunate happens and the only way to do so is to invest in a general insurance policy. You can also choose from a wide range of policies such as those protecting you against theft, damages, accident and medical emergencies. Let’s understand the meaning and importance of general insurance.

General insurance meaning and importance

A general insurance policy is essentially a policy that protects your financial well-being. It is a special type of policy that helps secure your many properties – whether it is the home you live in and possessions inside it, whether it is your priced vehicles or the most important thing of all; your health. This is a policy that allows you the reap various benefits of many types of insurance – home, motor vehicles, health, travel, and so on. Now let’s find out why it is essential that you invest in a general insurance policy.

Importance of general insurance

It protects your many assets:

In the course of life, everyone builds a corpus. This includes assets such as your home(s), your place of business and your two and four-wheelers. Although it is recommended that you purchase separate insurance policies for all your assets, you can also opt for a basic general insurance policy that covers all these assets under one policy. This way, you would be paying a single premium while you are protecting most of your assets. The insurance company typically assigns different amounts of sums assured towards all assets included in a general insurance policy.

You have someone to turn to in stressful situations:

Whether you are in an accident or whether a precious possession is stolen. You could be badly injured in a road-side accident, lose your home to an unfortunate fire incident or your possessions may be damaged in natural or man-made calamities. All these situations are incredibly stressful. In such a time, your insurance provider can come to your rescue. They can guide you with the formalities related to claim settlement and you can rest assured that all is not lost.

Your financial interests are protected:

Another general insurance importance is that it protects your financial interests. Say your house is damaged due to a cyclone, your car is stolen or you are hospitalised due to an accident; in the absence of insurance there is not much that you can do. You have to bear the financial loss arising from these situations. But if you have purchased a good insurance policy, you can rest assured that you will receive the assured sums as per the terms and conditions of the policy.

It gives you a sense of relief:

Any mishap can be incredibly disturbing. If one is the only bread-winner in the family and were to lose their source of income, or worse, die in unforeseeable circumstances, then it could render his dependants helpless. Depending on the type of insurance policy you purchase, you can breathe a sigh of relief if you know that you have insured the financial future of your family members in case you cannot offer them financial support in your absence.

Final word:

The importance of general insurance in India cannot be understated but it is crucial that you understand the basic difference between the special and general insurance policies. You would be paying smaller amount premiums in the case of general insurance policies whereas premiums for specific insurances policies are separate and could be on the higher side. However, you should note that the general insurance policy may also offer lesser coverage as opposed to a special one.