Insurance Basics Presentation

1. Insurance-Introduction

2. What is Insurance

3. Insurance is a
protection against
financial loss arising
on the happening of
an unexpected event.
Insurance companies
collect premiums to
provide for this
protection.
A loss is paid out of
the premiums
collected from the
insuring public.
Insurance Companies
act as trustees to the
amount collected

4. 4
Insurance is a
contract between 2
parties.
On party called the
insurer who
undertakes for a fixed
amount called
premium
.
To pay the other
party called the
insured a fixed
amount of money on
the happening of an
certain event
.

5. Fundamental Principles of Insurance
Utmost good faith Insurable interest Indemnity
Subrogation Contribution Proximate cause

6. Utmost Good Faith
Insured has a legal duty to
disclose all information about
the proposed contract of
insurance to the insurers
whether such information is
requested or not.

7. Utmost Good Faith
Insured has a legal duty to disclose all information
about the proposed contract of insurance to the
insurers whether such information is requested or
not.
Fire Insurance –
Construction,
Occupancy,
Stock – nature of
goods
Motor Insurance –
Cubic Capacity ,
year of manufacture,
tonnage, purpose etc.

8. It constitutes the legal rights to
insure arising out of a financial
relationship, recognized as law
between the insured and the
subject matter of insurance
Ownership of property Ownership of property Our own life
Insurable Interest

9. Fnancial compensation
sufficient to place the
insured in the same
financial position after a
loss as he enjoyed
Repair Reinstatement Replacement Money Transfer
Indemnity

10. Subrogation
This is defined as the
transfer of rights and
remedies of the
insured to the insurer
who has indemnified
the insured in respect
of the loss
Letter of subrogation
Ex : Vehicle theft claim

11. Contribution
 An insured may have several insurances on the same subject matter. If he
recovers his loss under all these insurances, he will obviously make a profit
out of the loss.
 The right of insurers who have paid a loss under a policy to recover a
proportionate amount from other insurers who are liable for the same loss.
 The common law principle allows the insured to recover his full loss within
the sum insured from any insurers he likes.

12. Proximate Cause
It means the active efficient cause
that sets in motion a train of events
which brings about a result, without
the intervention of any force started
and working actively from a new and
independent source.
A person insured under personal
accident policy went out hunting
and met with an accident. Due to
shock and weakness he was unable
to walk. From the wet ground he
contracted cold which developed
into pneumonia which caused his
death. The proximate cause of death
was the original accident and
pneumonia is only a remote cause
and hence the claim is payable.

13. Classification
General Insurance
Property Insurance
Fire,Burglary,Engineerin
g,Miscellaneous
accident
Motor Insurance
Two Wheeler/Private
car/Commercial Vehicles
Liability Insurance
Employees Liability,
Public Liability. Products
liability and professional
indemnity
Personal accident &
health insurance

14. Fire Insurance Cover for
Building
Machinery,
Equipments
Furniture,
Fixtures and
fittings
Finished
Goods, Stock in
transit, Raw
materials

15. Type of risks covers under
Standard Fire & Special Perils policy
 Fire
 Lightning
 Explosion/Implosion
 Aircraft Damage
 Riot, Strike, Malicious Damage
 Storm, Cyclone, Tornado, Tempest, Hurricane, Flood and Inundation
 Impact Damage
 Subsidence and Land Slide including Rock Slide
 Bursting/or overflowing of water tanks, apparatus and pipes
 Missile testing operations

16. Burglary Insurance is to indemnify the
Insured against loss or damage to the
property
Burglary Coverage:
Theft of property after actual forcible &
violent entry into the premises by
person/persons
Theft of property by a person and
subsequently breaking out of the
premises by forcible means
Hold up
Burglary Insurance

17. Engineering sector – Types of policies
Machinery Breakdown Insurance
Contractor’s All Risk Insurance
Contractors Pant & Machinery
Insurance
Boiler & Pressure Plant Insurance
Electronic Equipment Insurance

18. Machinery Breakdown
Insurance
This policy covers all kinds of
losses due to accidental,
electrical and mechanical
breakdowns as a result of
internal causes. It covered during
the machinery is in operation or
at rest or in the process of being
dismantled, overhauled or during
subsequent re-erection at the
same premises.

19. Extensions
Air freight
Express freight
(excluding
airfreight),
overtime and
holiday wages
Insured’s own
surrounding
property
Third Party
Liability

20. Machinery Breakdown Insurance
covers all kinds of losses
due to accidental, electrical
and mechanical breakdowns
as a result of internal causes
Air freight
Express freight (excluding
airfreight), overtime and
holiday wages
Insured’s own surrounding
property
Third Party Liability

21. Contractor’s All Risk
 The policy covers the civil engineering projects such as buildings, roads,
airports, flyovers, water tanks, sewage treatment plants etc.
 Unless specifically excluded, this covers the accidental physical loss or
damage to contract works during the execution of a civil engineering project.
 Coverage begins from the commencement of works or after unloading of
the first consignment at the project site, whichever is earlier, and terminates
on handling over of the works to the principal or on expiry of the policy,
whichever is earlier.

22. Main extensions of CAR Policy
Earthquake Act of terrorism Escalation
Limited
maintenance cover
Extended
maintenance cover
Clearance and
removal of debris
Damage to owner’s
surrounding
property
Third Party Liability Cross liability Express freight
holiday
overtime rates of
wages
Contractor’s Plant
and Machinery

23. Contractor’s Plant and Machinery
Insurance
It covers the loss or damage to the
Contractor’s construction mobile
equipment such as bulldozers, cranes,
excavators, compressors etc. due to an
accident arising out of external perils. The
cover is operative while the insured
property is at work or at the rest, or being
dismantled for the purpose of cleaning or
overhauling or during subsequent re-
erection.

24. Extensions
Air freight
Express freight
(excluding
airfreight
overtime and
holiday wages
Insured’s own
surrounding
property
Third Party
Liability
Clearance and
removal of debris
Escalation
Additional custom
duty
Act of terrorism

25. Boiler and Pressure Plant Insurance
This policy covers boilers
of various kinds,
pressure plants and
vessels under pressure,
including fired and
unfired, against loss
and/or damage due to
explosion or collapse

26. Additional Coverage
Damage to the owners
existing surrounding
property
Damage to third party
property and/or
personal injury
Express freight
(excluding airfreight),
overtime and holiday
wages
Airfreight Additional custom duty Escalation

27. Electronic Equipment System
It provides comprehensive
coverage for electronic equipment.
It includes physical loss or damage
to all electronic equipment and
data media, as well as the
increased cost of working resulting
from an accidental and unforeseen
physical loss or damage to the
electronic equipment.
For a nominal additional
premium, the policy can
be extended to cover risk
of terrorism.

28. Motor Insurance
Liability only policy Package Policy
covers Third party liability
for bodily injury and/or
death and property
damage as specified.
Personal Accident cover
for owner driver included.
covers loss or
damage to the
vehicle insured
plus liability cover

29. Risk Covered on Package Policy
 Indemnifies the insured against loss or damage to the vehicle
insured and/or its accessories by
 Malicious act
 Terrorist activity
 Whilst in transit by road, rail inland-waterway lift, elevator or air
 By landslide rockslide

30. Salient Features of Motor Tariff
1. Insured’s Declared Value (IDV)
This is Insured Estimated value
in Motor Insurance. It is deemed
to be the sum insured for the
purpose of Motor Tariff and to be
fixed at the commencement of
each policy period for each
insured vehicle. It is calculated
on the basis of the
manufacturer’s current listed
price of the brand/model and the
age of the vehicle.

31. Insured Declared Value
Upto 6 months 5%
6 months to 1 year 15%
1 year to 2 years 20%
2 years to 3 years 30%
3 years to 4 years 40%
4 years to 5 years 50%

32. 2. No Claim Bonus
This is a discount in the premium allowed
at the time of renewal if there is “No claim”
during the policy period. The percentage of
discount given per year of renewal is as
follows:-

33. No Claim Bonus
1st year Nil
2nd year 20%
3rd Year 25%
4th Year 35%
5th year 45%
6th year 50%

34. AIMS Add On…
Competitive
premium rate-
Discount up to
70%
Instant coverage /
Renewal coverage
Claims
management
services and
follow-up

35. Cashless settlement
of claim within
15 days after
getting all
relevant claims
papers
Exclusive experts
for claim
analysis
Freedom of
choice to
select the
insurer

36. Liability Insurance
Employee
Liability – WC
Policy
Public Liability
Product Liability
Professional Liability

37. Employee Liability Insurance(Workmen’s compensation
Insurance)
 This policy covers the statutory liability of an employer for the death
of or bodily injuries or occupational diseases sustained by workmen
in the insured’s immediate service and arising out of and in the
course of employment.
 Any employer whether as a principal or contractor engaging
“workmen” as defined in the Workmen Compensation Act or any
employee who shares the Employer-Employee relationship.
Who needs these policies

38. Public Liability
This policy provides indemnify to
the insured against their legal
liability to pay compensation in
accordance with the Indian Laws
which covers the following
Accidental bodily injury to any
person not being a member of
the insured family or engaged in
the service of the insured.
Accidental loss or damage to
property not being property
belonging to or in the custody of
the insured or any person in the
service of the insured.

39. Product Liability Insurance
Coverage of a manufacturer’s liability for losses or
injuries to a buyer, user or bystander caused by a
product defect or malfunction
Accidental death/bodily injury or disease to any third
party
Accidental damage to property belonging to a third
party

40. Professional Indemnity
This policy provides
protection for professional
like Doctors, Solicitors,
Chartered accountants,
Architects et. Against their
legal liability to pay damages
arising out of negligence in
the performance of their
professional duties

41. Fidelity Guarantee
Covers
Financial loss sustained as a
result of infidelity, which includes
fraud, dishonesty, forgery,
embezzlement, larceny,
misappropriation, default or
fraudulent conversion of money
or stocks committed by salaried
employees in the course of
performance of duties
This policy is issued to the
employers to cover loss the
infidelity of employees occupying
positions of trust involving duties
such as handling cash, stock-
keeping etc.

42. Money/Cash Insurance
This policy intended to protect
against loss of money. It
covers the risk of loss of
money/cheques/postal
orders/postal stamps by
robbery or theft or any other
cause whilst in transit among
places to be pre-defined. It
also cover cash in safe and
cash in counter
Cash in
Transit
Cash in safe
Cash in
counter

43. Medi Claim Insurance
Risk Covered:
Reimburse or Cashless facility for diseases and
accidents.

44. Risk
Covered:
Reimburse or
Cashless facility for
diseases and
accidents
Health Insurance

45. General Features
 Age Limit: 3 months to 45/65 Years
 Sum Insured: Min. Rs.50000/- to Rs.10 Lakhs
 Nature of treatment: Allopathic/Ayush
 No Claim Bonus - 5% every year
 Family Discount:10% to 15% every claim free year
 Income Tax Benefit: Premium up to Rs.20000/- per year
 Cost of Health check up 1% of the sum Insured after four
consecutive claim free years.
 Group discounts according to group size

46. Health insurance products
Individual Family floater Group Insurance Students
Critical illness Hospital cash Senior citizen Top up policy

47. Type of Group
Sum Insured
Age Bracket
1st, 2nd & 4th year exclusion
clause
1st 30 days exclusion clause
Pre-Existing Disease
Room Rent/ICU Charge
Pre & Post Hospitalization
Coverage Day Care Procedures
Features

48. Cashless treatment/Re-
imbursement
claims Sub Limits
Co Payment
Cumulative Bonus
Emergency Ambulance Charges
Period of Insurance
Approximate number of lives for
coverageClaims Settlement
Mode of treatment
Existing insurance
policy/insurer/claim ratioPremium -Sec 80 D IT exemption
Group/Family -Definition

49. Smart Scholar Insurance
Risk Cover
Students Mediclaim for
diseases and Accidents:
Rs.10000
PA Death cover for
student:
Rs.50000
Permanent Total Disability
to Student: Rs.50000
Fee protector-Accidental
death for Parent:
Rs.100000
Ambulance charges:
Rs.1000

50. Cont..
Premium per student per
year Rs. 100/ including
service tax
Type of policy: Group
insurance covering all
students
Insurer: United India
Insurance Company
Policy in the name of
Educational Institution
Health card for each
student

51. Personal Accident
Permanent
Total Disability
Permanent
partial
disability
Temporary
Partial/Total
Disability
Accident
Mediclaim
Weekly
Compensation
Children’s
Education
Fund
Ambulance
Charges
Hospital Cash
Death Due to accident

52. Personal Accident-other benefits
Cumulative Bonus
5%
Group Discount
according group
size 5%-30%
Family Discount
10%
Universal Risk
Cover

53. Features
Basic Cover
120 times of the
monthly Income
Wider cover
60 times of the
monthly Income
Age
18-70 yrs

54. Different Types of Accidents & Disasters
 Vehicle Accident, Road Accident
 Lift /Escalator Accident
 Wildfire; Forest Fire
 Storm, Tempest, Hurricane, Tornado
 Mining Accident, Mine Blast Cyclone,
Hurricane, Typhoon
 Fire Accident
 Rail Accident
 Ship / Boat Accident
 Natural Calamities
 Explosion
 Attack from Wild Animal’s,
 Earthquake/Tremor
 Hooch Tragedy
 Landslip, Rock slide
 Lift Accident
 Gas Tragedy
 Air Accident
 Industrial Accident
 Firework Accident
 Flood, Tsunami
 Snake Bite, Bite from Rabid Dog
 Electric Shock
 Fall from Trees & Building,

55. Term Life Insurance
 Protection against the unexpected
 Term policy cover makeup for the loss of your income
 Covering financial loss
 Taking care of long term liabilities
 Ultimate security for your beloved family
 Fixing Sum Insured depending upon your age, income and
liabilities
 Save income Tax under sec 80 C
 There are different types of Term policies according to your
needs

56. Insurance policies for a low income family
Type of Insurance Name of Policy Sum Insured Premium
Home Insurance
House Holders
Package policy Building - 10,00,000 400
Contents - 2,00,000 200
Private Car Package Policy 3,00,000 5500
Personal Accident PA Policy 25,00,000 2550
Health Insurance
Family Floater
Mediclaim 1,00,000 2315
Life Insurance Term Insurance 30,00,000 5000
Total Sum Insured and premium per year 71,00,000 15,965
Per day expenses Rs. 44/

57. Insurance policies for a middle class family
Type of Insurance Name of Policy Sum Insured Premium
Home Insurance
House Holders
Package policy Building - 20,00,000 800
Contents - 4,00,000 400
Private Car Package Policy 6,00,000 10000
Personal Accident PA Policy 50,00,000 6000
Health Insurance
Family Floater
Mediclaim 4,00,000 6115
Life Insurance Term Insurance 50,00,000 8000
Total Sum Insured and premium per year 1,34,00,000 31,315
Per day expenses Rs.86/

58. Insurance policies for a upper class family
Type of Insurance Name of Policy Sum Insured Premium
Home Insurance
House Holders Package
policy Building -30,00,000 1200
Contents - 6,00,000 600
Private Car Package Policy 12,00,000 21,000
Personal Accident PA Policy 100,00,000 11000
Health Insurance Family Floater Mediclaim 6,00,000 12500
Life Insurance Term Insurance 100,00,000 13500
Total Sum Insured and premium per year 2,54,00,000 59,800
Per day expenses Rs.163/

59. Thank You.
AIMS Insurance Broking Pvt. Ltd.
19/458, IInd Floor, Global Plaza
Poothole P.O., Thrissur- 04
Phone: 0487-2386364/2389703
Email:-info@aimsinsurance.in
Web: www. aimsinsurance.in