General Insurance: Fire, Marine, Motor, Health, Personal Accident and Rural/Micro Cover
General insurance is short-term (usually one year), indemnity-based and renewable. The exam tests standard covers and exclusions, and how a claim is calculated.
Fire
The Standard Fire and Special Perils Policy covers fire, lightning, explosion, riot and strike, malicious damage, storm, flood, inundation, subsidence, landslide and impact by vehicles or aircraft; war, nuclear and (unless specifically bought) earthquake are excluded. The average clause applies where the sum insured is less than the value of the property.
Marine
Cargo and hull covers are governed by the Marine Insurance Act, 1963. Institute Cargo Clauses A (widest, all risks), B and C (named perils) differ in scope. Learn particular average (partial loss borne by the cargo concerned), general average (a sacrifice made for the common safety and shared by all cargo owners), salvage and constructive total loss.
Motor
Own-damage cover is rated on IDV (depreciated value) with a No Claim Bonus for claim-free years; third-party liability is compulsory under the Motor Vehicles Act, 1988. Section 140 no-fault liability does not require proof of negligence. A valid driving licence and fitness/PUC papers are conditions for own-damage claims.
Health and personal accident
Health covers may be indemnity (bills reimbursed or cashless through a TPA) or fixed benefit. Watch initial waiting periods, pre-existing disease waiting periods, sub-limits, room-rent caps and the moratorium after which claims cannot be contested except for fraud. Personal accident cover pays capital sums for death, loss of limbs or disability; it does not pay hospital bills.
Rural and micro-insurance
Micro-insurance offers small sums assured and low premiums, distributed through self-help groups, MFIs, NGOs and cooperatives. Social security schemes such as PMJJBY (life) and PMSBY (accident) extend cover to rural households, alongside the Aam Aadmi Bima Yojana.
Worked example (average clause)
Stock worth Rs 20,00,000 is insured for Rs 10,00,000. Fire causes Rs 4,00,000 loss. Claim = 4,00,000 x 10/20 = Rs 2,00,000 less the policy excess, because the insured is his own insurer for the shortfall.
Traps
CIC-C gives narrower cover than CIC-A; average does not apply to a total loss of the whole property; PA does not reimburse medical costs.