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published in Mint on Tuesday, Sep 17th, Written by Kapil Mehta
I have an all-risk marine insurance to cover transport of wares from my factory. Does this cover have any exclusions?
—Nari R.

All risk policies are generally comprehensive. Specific exclusions depend upon the policy and the terms you negotiated while buying the cover. Generally, some of the typical exclusions are pilferage, regular loss of goods, losses related to wear and tear, losses caused by poor packing of goods and war or terrorism-related losses.
I would like to buy health insurance for the staff working at my house. Do they need to produce an age proof? Please advise.< —Veena
Some form of an age proof is necessary to buy insurance. Insurers have different requirements. Some will accept a voter identity card, while others will want a school leaving certificate, passport or driver’s licence.
A few insurers issue insurance without age proof documents, but will ask for an age proof when your staff makes a claim.
Could you tell me what is insurable interest?
—Seema De

Insurable interest is a fundamental insurance principle, according to which a person can insure an asset or event only if they would suffer a financial loss were the asset to be damaged or the insured event to occur. Some examples of insured events are hospitalization, death or damage due to natural calamities. Practically, this means that you can insure your home for damage but not your neighbours’; your spouse’s life but not your cousin’s; your own business for liability but not a friend’s.
The principle is important because it differentiates gambling from insurance. For example, it prevents a punter from buying insurance on an unrelated person’s life hoping that person dies prematurely. It also prevents fraud. A person is less likely to burn down his own house because of the dislocation involved and the fact that insurance will cover only the actual repair costs. An unrelated person with no insurable interest will have no such compunction.
Can I buy a personal accident policy that covers just road risk?

Typically, insurers will not allow you to restrict your cover to a sub-set of accidents and that’s a wise decision.
A good insurance contract removes ambiguity when a benefit is payable. Imagine the subjectivity if only road accidents are covered. Will the benefit be paid if the accident takes place on a dirt track or kutcha road? Will electrocution by a street light be considered a road risk? If a child runs into an uncovered manhole is that a road risk? If a snake bites on the road? And so on.
Personal accident policies are cheap. A cover of Rs.15 lakh should cost less than Rs.1,500 per year. Buy a comprehensive personal accident insurance.