General (Non-Life) Insurance Products and Standard Products
What this domain tests
This section tests product features, mandatory covers, standard products and the arithmetic of claim settlement. Expect questions on motor, fire, marine, health, personal accident, liability and crop insurance.
Core product map
- Motor: third-party liability is mandatory under the Motor Vehicles Act; own damage is optional. Key terms include IDV, no-claim bonus, deductibles and add-ons such as zero-depreciation and engine protection.
- Fire/property: Standard Fire and Special Perils cover; Bharat Griha Raksha for homes; reinstatement value; average clause for underinsurance.
- Marine: hull and cargo; Institute Cargo Clauses A, B and C; warehouse-to-warehouse transit.
- Health: indemnity and benefit policies; Arogya Sanjeevani is a standard product; waiting periods, pre-existing disease clauses, cashless settlement and TPAs.
- Personal accident: death, permanent total disability, permanent partial disability and temporary total disability; it covers accidents, not illness.
- Liability: public liability, product liability, professional indemnity and directors' and officers' cover.
- Crop: PMFBY and parametric covers.
- Standard products: Arogya Sanjeevani (health), Saral Suraksha Bima (personal accident) and Bharat Griha Raksha (home).
Worked example
A shop has a fire policy with sum insured 20 lakh; the property's actual value is 25 lakh. Fire causes an 8 lakh loss, salvage is 50,000 and the deductible is 20,000. Because the sum insured is below value, the average clause applies: (20/25) x (8,00,000 - 50,000) = 6,00,000. After the deductible, the payable amount is 5,80,000. Without the average clause, the insured might wrongly expect 7,50,000 after salvage and deductible.
Traps that cost marks
- Treating IDV as the new-vehicle price.
- Thinking third-party motor cover is optional.
- Confusing personal accident with health insurance.
- Ignoring waiting periods and pre-existing disease clauses.
- Forgetting the average clause and salvage in property claims.