Author: parastar

Categories
Insurance

How to start an insurance company in India?

How to start an insurance company in India?

India is among those countries that have very strict laws when it comes to giving out permissions for financial institutions, funds and insurance companies. This is why it becomes crucial for an aspiring insurance-entrepreneur to to understand the insurance related regulations and rules of India.

This is one of those businesses where you have to first think about all the legal requirements and thoroughly analyze every regulation that is there for starting an insurance company. You also need to consult a lawyer or an expert in this aspect.

Here, we are going to tell you about the steps that you need to follow that will answer your question ‘how to start an insurance company in India?’.

Steps to start an insurance company in India

1. Permission from IRDA

The insurance regulatory and development authority (IRDA) is the supreme authority from whom you have to obtain the certificate of authority to become eligible for applying for insurance. The point to be noted here is that you need to have a different certificate for each category of businesses and you can at no point join other businesses with the insurance business. All the entities have to remain separated from this business.

2. Documentation

An entity that wants to apply for an insurance license needs to apply to IRDA through IRDAI and IRDA/R1. This is the first step towards obtaining the insurance license. The documents that you need to furnish for this are-

  • Show proof that you are a valid company under the Companies Act 2013.
  • Details of directors, board members and investors.
  • A five-year business plan that has been approved by the board.
  • Memorandum of Association and Articles of association. Both need to be drafted as per the regulation of the government and IRDA.
  • Physical copy of the partnership agreement between partners/investors/board members. It should be certified, notarized and registered.
  • Annual report of financial accounting of all the members.

3. Application for registration

After the application under IRDA/1, if the authority gives a go-ahead for you to apply for an insurance license, then you have to fill an application under IRDA/2. This is the first formidable step for applying for a license. The previous two are just preliminary steps. They are just preparation for application.

There are many more documents that you will need to produce in front of the authority while completing the application. Recognition of your IRDA/1 is sent to you and then you are given a list of documents and proofs that you need to produce in front of the authority to obtain your license. Some of the prominent ones are-

  • Your capital proofs. The point to be noted here is that there are different thresholds for each category of insurance type when it comes to business capital. For example- You need to have at least ₹100 crores as capital for being eligible for life insurance.
  • Affidavits of Indian and foreign promoters, shareholding percentages, executive positions, letters of appointment, FIPB and FDI regulations completion proof and many other documents.

This is the step where you need to understand that the process can take some time since it is very elaborate. Well, starting an insurance company in India is not easy as it seems.

IRDA owns all the rights regarding the acceptance and rejection of your license. It may reject your application for non-compliance on any grounds. It reserves the right to do so. Their intimidation regarding acceptance or rejection will be communicated to you in 30 days.

4. Commencing your business

If you are able to get your license then the guideline laid down by IRDA says that you have to commence your business within 12 months of obtaining the insurance company license. This is a very strict guideline and is given a lot of importance by the authorities. Several businesses were ineligible to compete and don’t own a license because of non-compliance with this guideline.

Also, even after granting you a license to commence as an insurance company; IRDA can ask you for additional information. It can also conduct a proper inquiry if it wishes to. This isn’t done with the purpose of finding frauds but can be done as a precautionary measure. They cannot leave anything for a chance.

What you need to do is to create a proper plan way beforehand and you should always be in a position to start your insurance business as soon as you get the green light. Also, you need to keep in mind that you cannot start advertising and attaining clients before getting your license. This is a criminal offence that can land the promoters in jail and face fraud charges.

Eligibility criteria

There are proper eligibility criteria laid down by the authorities which have to be adhered to before even applying under IRDA/1. There are multiple grounds on which the application can be rejected in the initial step. You need to properly and thoroughly research the guidelines of the authorities to understand your eligibility.

In order to function, an insurance company is required to obtain a license. The registration and license issuance of an insurance company is regulated under the Insurance Regulatory and Development Authority Regulation, 2016. Following factors standards are used to define the eligibility for an Insurance company license:

  • The company must be recognized by IRDAI.
  • The company must be registered under the LLP Act of 2008.
  • The minimum net worth of the firm must be 10 lakhs [INR].
  • Under the LLP Act, the company registration name must have the words “Insurance Marketing Firm”.

The Bottom Line

With the help of the above points, you can have a basic understanding of how to start an insurance company in India. Some special corporate lawyers just operate in this segment and are highly specialized in making an application. Apart from that the chartered accountants are also trained professionals who are familiar with the guidelines of the IRDA. Consulting with them can also help you acquire better knowledge.
Another thing that needs to be understood as well is that these guidelines keep changing continuously. The above-mentioned steps are not completely exhaustive and are subject to changes and development. The best thing for you is to always be updated through the websites of the authorities and governments.

Related articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I
Categories
Insurance

Laptop Insurance in India

Laptop Insurance in India

One of the most important devices that many people use regularly is a laptop. Laptops are essential not only for official purposes, but also necessary for educational, and other online activities. Especially with the new practice of working from home and online education and training, a laptop has become one of the most essential devices in our daily routine.

It is important to take Laptop Insurance as technological devices always remain at risk of damage. Some laptops have a definite lifetime and some may get damaged due to negligent usage. It is not only about the physical damage but many internal faults may appear as well due to loose handling and lack of care. It is very hard to tell how long the laptop would serve and when a problem may appear. To minimize these losses and damages, you must consider buying laptop insurance.

Laptop insurance in India is one of the least discussed and known about insurance. So, here’s a detailed overview that’ll highlight all the important aspects of this insurance.

What is covered in laptop insurance?

The very first concern is what laptop insurance would cover. So let us check out the coverage facilities that you may receive under laptop insurance.

  • Most insurance companies would cover all brands of laptops starting from Apple to Asus.
  • Any breakage, crack, or damage to your laptop screen would be covered under a laptop insurance policy.
  • Any electrical breakage or damage would be covered.
  • Mechanical damage and faults would be covered under a laptop insurance policy.
  • If your laptop gets lost or if it is a case of theft or burglary, the insurance company would provide coverage.
  • If there is an accident that caused damage to the laptop, it is also covered under the policy.

Remember that these coverages would vary from insurer to insurer. You must collect adequate information about the coverage from an insurer before buying so that the policy meets your requirements.

What is not covered in a laptop insurance policy?

It is also necessary to know what would not be included in a laptop insurance policy. Again, remember that inclusion and exclusion of coverages would vary from one insurer to the other.

Let us check out the possible exclusions in laptop insurance.

  • Any previous damage or fault of the laptop before buying the insurance policy would not be covered under the policy.
  • Any intentionally done damage or damage incurred due to careless handling of the user would not come under the coverage of the policy.
  • Damage to the laptop due to war or terrorist activities is not covered under the policy.
  • Normal scratch, or damage due to rough usage, and gradual damage due to weather and long-time usage would not receive coverage from the policy.
  • Insurance companies don’t provide coverage for the maintenance of the laptop.

What are the advantages of buying laptop insurance?

Now that you know what is covered and what is not covered by laptop insurance, let us explore the benefits of buying laptop insurance.

  • It is a better version of your laptop warranty. While a laptop warranty covers only the basic facilities for a very short period of time, a laptop insurance policy would provide a broader range of facilities and coverages.
  • You would receive a lot of discounts, membership facilities, and offers during the policy renewal and rewards depending on your claim records. This eventually aids in saving money.
  • You would receive immediate responses and assistance in case of any sudden damage to your laptops and emergency services.
  • Most laptop insurance companies provide door-to-door pickup and delivery services. This means you would just need to inform your insurance company about the damage and a surveyor and agent would visit you to look into the matter.
  • You can save up a lot of money by buying a laptop insurance policy. This is the biggest facility for which buying laptop insurance in India is recommended. The company would compensate for the financial loss and help you throughout the repairing process.

Steps to get your laptop insured

So how does the whole procedure go? What factor would influence your buying decision? How would you report and claim your insurance? Let us look into the steps.

Decide the coverage

For organizational and even individual purposes, count the number of laptops being used and measure the potential risk factors. Think if you need an insurance policy or not.

Compare and decide

Now think of what coverages you require. There are multiple companies offering different deals. Also, take into account the budget for buying the policy. Now compare the companies, check ratings, and see which company would meet your organizational demands and fulfill your requirements.

Fill the proposal form and purchase

Once you choose the right company, you are required to fill a proposal form, submit documents that the company would ask for, make payment, and buy a laptop insurance policy. Make sure to go through the terms and conditions before purchasing.

Laptop insurance Claim process

Here are the steps you need to follow to get your claim:

  1. If it is a case of theft or burglary, you need to report it to the police first. An FIR copy is a must for the process.
  2. Next, you have to submit the FIR to the insurance company and fill the claim form.
  3. If it is about mechanical or accidental damage, you can inform your insurance company and file a claim.
  4. You may require to submit several documents to process the claim. Make sure to submit them all. Remember that you have to file a claim immediately after facing an issue. Don’t be late.
  5. Now that you have submitted a claim, you have to wait for the insurance company to verify and check the eligibility. Then the company would either accept or reject (only happens if it is not genuine) your claim.
  6. Once the claim is accepted, you would get the reimbursement in the time period mentioned in your policy.

Therefore, to minimize the financial loss and damage to your laptop, you must consider buying a laptop insurance policy from a trusted and reliable company.

Compare, analyze, and always select a company that meets your demands and requirements. Reputed companies usually prove to be more reliable and offer a hassle-free claim process.

Related articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I
Categories
Insurance

Cyber Insurance in India

cyber

Cyber Insurance in India

We live in an era where virtual is the new way of life. From individuals to business firms, everything has shifted to the online world for most of their operations. Entertainment to shopping, communication to banking every other sector and service is now available online. Although the internet revolution has eased up our lives to a great extent. We need to understand the threats it brings along.

In India, the past decade has witnessed the introduction of digitization in all facets of life. Every corporation has adopted online technology. This makes it necessary for everyone to understand the importance of cyber insurance in India.

What is Cyber Insurance?

Cyber insurance ensures that your organization gets financial assistance in case of a data infringement or cybersecurity violation that has caused financial loss to your organization. Not only that. It also covers the costs and expenses needed for a legal procedure to get justice against the cyber attack. It acts as your personal arsenal against the malicious activities of the cyber attackers.

Cyber threats can be crucially dangerous for organizations. Organizational confidentiality can be threatened if cybersecurity is not ensured. However, even after taking every necessary step, there are still chances that the data may be leaked and misused. This may lead to huge losses for the company. In such a situation, cyber insurance comes to the rescue.

Features of Cyber Insurance

The features of cyber insurance are as follows:

  • Cyber insurance policies usually have a tenure of a year which can be extended upon renewal.
  • People that are above the age bracket of 18 years can avail cyber insurance policies.
  • The total sum insured starts from 1 lakh. It can extend further to 1cr- 5cr and can be increased or decreased as per the need of the organization.
  • Affordable premium plans that start from 700 rupees.
  • Restoration expenses are reimbursed during specific malware attacks.

Benefits of Cyber Insurance

Potential threats that cyber insurance can help you to overcome

You may wonder what possible cyber threats are there that can damage an organization’s confidentiality and dignity. Let us look into some common cyber threats that are prevalent in India.

Data infringement– This is a huge threat to the privacy of the organization as well as its employees. The data relating to the organization’s activities, strategies, plans, employee information, etc. can be breached.

Ransomware– In this cyber threat, malware, which is malicious software, is injected into a system to corrupt the computer system. The malware would block the organization’s access to some files and data. The hacker then demands a ransom to give the access back to the owner, hence the name ransomware.

Personal negligence– The cyber-world is becoming confusing and difficult to understand. Thus, many employees unknowingly invite cyber threats. Their lack of knowledge and expertise can lead to severe security threats to the organization.

What would be Covered under Cyber Insurance?

Coverage varies from one insurer to the other. But there is a range of facilities that are covered by insurers. You should choose the one that provides maximum coverage for your organization.

Let us see what are the overages that you can avail from the best insurer.

  • Most insurers offer coverage for identity theft.
  • Insurers cover malware attacks.
  • They cover social media attacks and vulnerabilities.
  • IT theft is also covered by insurers.
  • Cyber-stalking is covered by many insurers.
  • Phishing is covered under most insurance policies.
  • Email spoofing coverage is commonly offered.
  • Cyber extortion coverage is common as well.
  • Some insurers offer cyber-bullying coverage.
  • Privacy and data breach coverage are provided by most insurers.
  • Many insurers offer coverage for legal procedures regarding a cyber-attack.

Sub-limits and Exclusions

Often, the clauses in the cyber insurance policies have sub-limits. These sub-limits define the exact coverage of the policy. For example, claims related to e-mail spoofing and phishing are only covered up to a certain limit. This limit is per-determined. If the loss exceeds this limit. The insurer will have to bear the losses.

Physical damage to the assets or humans is not covered under this policy. Also, any claims that can be linked or traced back to some fraudulent conduct are immediately excluded. The insurer can also impose a fine on the insured for such faulty practices.

What are the Consequences of Cyber-Attacks?

Now comes the question of how cyber-attacks can harm the business and why cyber insurance is important to help you out. Let us first talk about the dire consequences that cyber-attacks generally lead to.

  • Financial loss– Business information and bank links can be leaked as a result of a cyber-attack. Therefore, the attacker may withdraw money or ask for ransoms resulting in an economic loss. Also, if you go for legal procedures, you would face financial losses.
  • Interrupt’s workflow– Naturally, a data breach or intrusion in the computer system would hamper the overall workflow of the organization. Employees won’t be able to work efficiently and use the systems properly.
  • Decreases trust– Customer information can be hacked as well. This means customers may lose trust in the company. You may lose customers as a result of breaking trust.
  • Tarnishes reputation– When the overall performance degrades and customers lose trust in the company, it tarnishes the reputation of the company in the market.

These are the consequences that can severely affect your business and downgrade the reputation of the company in the market as a result of a cyber-attack.

Final Overview

Data breaches and cyber-attacks are increasing day by day. In such a situation, it would be wise to buy cyber insurance in India. Cyber insurance ensures technological security and minimizes the financial loss that you may face due to a cyber-attack.

As organizations are increasingly using technology to conduct their activities, it is important to ensure maximum security as important details and data are involved. However, with the advancement of technology, cyber attackers have also evolved. Thus, taking precautions is the best solution.

And, undoubtedly, cyber insurance can help you out in case of a cyber-attack. You would be able to maintain the reputation and dignity of the organization. The company would also take liabilities for the damages thus minimizing the losses.

Thus select a cyber insurance policy that would fulfill your requirements and meet your organizational demands.

Related Articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I
Categories
Insurance

Structure of commissions for insurance agents

Structure of commissions for insurance agents

The commission obtained by an insurance agent varies depending on the norms and regulations of insurance companies.

However, there is a specific commission structure followed in India that helps insurance agents avail remunerations effectively without any confusion. Let us now dive into the subject, commissions for insurance agents to understand the concept in a better way.

Understanding the concept of insurance commission

Insurance agents depend on commissions and fees that are paid to them by the insurance company. These commissions and fees depend upon the kind of policies sold to the people. The commissions vary from policy to policy.

Another factor affecting the commissions paid to the insurance agent is the insurance premium. For policies sold with higher premium value, the commission paid is more. The insurance premium amount is an annual sum that is paid by the insured [be it an individual or business firm] for availing the benefits of the insurance policy. These policies can be in the form of automobiles, life, dental, medical insurance, etc.

The premium acts as a direct income for the insurance company out of which a specific percentage is awarded to the insurance agent for securing the plan. Let us now go through the various insurance commission structures present in the domestic Indian market.

The commission structure

General insurance commission structure

This is the category of insurance that safeguards individuals and organizations from some loss-triggering event like fire etc. The below-mentioned commission doesn’t include auto-insurances.

  • For the fire retail insurance, the agent gets a 15% commission on the policy.
  • For fire corporate risk the agent can receive a 10% commission.
  • For marine cargo, the fixed commission is 15%.
  • Marine hull insurance will help the agent get a commission of 10%.
  • For other different and corporate general insurance, the agent can get a commission ranging from 10%-15%

Health insurance commission structure

Insurance agents also avail commissions for selling health insurance policies. Following is a breakdown of commissions received by insurance agents through health insurance plans:

  • For individual health insurance, the agent’s commission can be up to 15%.
  • For the group health insurance provided by corporate agencies, the agent gets a commission of 7.5% of the total amount of insurance.
  • For family health insurance the agent gets a 15% commission.

The health policies vary a lot from company to company. Plus, the IRDA guidelines regarding the commission are a bit flexible as well. So, the amount may vary a bit depending on the company offering the insurance.

Life insurance (single payment) commission structure

This is probably one of the most purchased categories of insurance in the market. The commission received by an insurance agent on Life Insurances are:

  • All life insurance except terms plans fetches a commission of 2% for the agent.
  • The term plans get a 7.5% commission for the agents.
  • Renewable terms group plan will attract a 5% commission to the agent or ₹10 lakh whichever is less.
  • A group term plan in a single payment will include a 5% agent commission.

Life insurance for regular premium products commission structure

The below-mentioned commissions for insurance agents are the percentages of commissions that agents get for a life insurance policy that includes the payments of premium for regular products. The insurance premium can be paid monthly or yearly.

  • Individual term insurance will attract a hefty 40% commission in the first year of the plan. And with the subsequent renewals, the commission will be 10%.

The following table highlights the entire commission standard:

Insurance Plan Tenure

Commission Percentage

5 years

15%

6 years

18%

7 years

21%

8 years

24%

9 years

27%

10 years

30%

11 years

33%

12 years [or more]

35%

As already highlighted in the table above, insurance agents can avail of a commission of 15% with a renewal commission depending upon the kind of life insurance policy is sold to an individual. The renewal rate of commission at 40% for a 5-year policy is the highest return an insurance agent can receive.


The highest commission rate obtained stands at a life insurance policy that has a tenure of more than 12 calendar years. However, the subsequent renewal commission rate stands at 10% which is standard for most life insurance plans. On the other hand, the commission percentage on selling Individual Term Insurance stands at 35% which, by far, is the highest commission rate established.

Factors affecting commissions

There are specific guidelines laid down by the Insurance Regulatory and Development Authority (IRDA) about the commission payments to the agents. The companies seeking an insurance license are informed about these guidelines beforehand.

It is the amount that the company pays to the agent to get customers. The agents are given a commission as per the time of the policy. The longer the policy term is, the higher will be the agents’ commission. The agent receives a commission on a policy-to-policy basis.

Another aspect that affects the commission is the type of policy being sold. There are specific percentages fixed for each type of policy being sold by the agents. The insurance companies have to give commission as per these guidelines. Although the companies sometimes give bonuses as well to provide external motivation to their agents.

Companies might even offer other benefits like international tours, to their agents as an appreciation for their work.

There is a certain bit of flexibility in giving the commissions for insurance agents. The IRDA has relaxed certain guidelines about the minimum and the maximum number of commissions that can be paid. You can know all about it from their website.

Conclusion

There are several categories of commissions for insurance agents that seem like they are too much of an amount to be paid to a mediator. However, it is important to understand that the commission offers a significant opportunity as an incentive in the life of an agent. In addition to the above-given information, if you wish to dive deeper then it is advisable to get in touch with an expert or an experienced insurance agent to gather more information about the commission standards.

Related Articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I
Categories
Motor Insurance

What is EP in Car Insurance?

What is EP in Car Insurance?

Taking up an insurance policy for your vehicle is extremely important, as it is an expensive asset. With numerous insurance policy options available in the market today, choosing and buying the one that is best for you can be a tricky job. One might plan to choose a policy that has the lowest premium rates, but this often leads to important aspects being missed out on. One of them is the engine of the vehicle.

The engine of a car is rightfully called its ‘heart’ and therefore it should be taken utmost care of.
A comprehensive car insurance policy only covers repairs to your car caused by accidents. The engine of a car needs special attention and care for your vehicle to last long. Hence, it is always advised to look for add-ons for your engine. And the best add-on to avail is Engine Protection [EP] in car insurance.

Let us now answer the fundamental question of “What is EP in car insurance?”

What is an engine protection (EP) cover?

The EP in car insurance is basically an added coverage that is taken up with the comprehensive car insurance policy. This particular add-on offers coverage in the case of losses or damage to the vehicle’s engine of the insured individual. The engine protection cover provides compensation for the repair or replacement of the car’s engine and parts.
Now that we have covered the basics of “What is EP in car insurance”, let us look at the benefits and exclusions of it.

Benefits of EP add-ons:

  • Any damage to the engine needing repair or replacement will be reimbursed by the insurance company up to the limit specified in the policy. The benefits of this insurance add-on are:
  • It is beneficial for individuals residing in places that are prone to flooding; during monsoons, natural calamities, etc.
  • It covers any engine damage due to water entering the engine.
  • It covers engine damage caused due to leakage of lubricating oil.
  • Physical damages to essential elements of the engine such as connecting rods, gearbox, etc. are also included in EP plans.
  • Owners of new or expensive cars might have high costs of engine repair and replacement. Hence, an EP plan is beneficial.

Exclusions of EP add-ons:

The policy comes with exclusions and conditions where the add-on is not valid. The exclusions are as follows:

  • Age of the car: This add-on is only applicable for cars that are below 5 years old.
  • Force-starting the car: When submerged in water, the engine shuts down to protect itself and prevents water from getting in. Do not try to start the engine by force. This will not just damage your engine but also may lead to the rejection of your claim.
  • Limited validity for claim: Depending on the insurance company, there are only one or two claims that can be made within the policy period. In case the insurance holder wishes to make another claim, a new add-on has to be purchased.

Conclusion

It is essential for everyone to do their research before investing in any car policy. It will help you to acquire all the necessary details about a car insurance policy before choosing the right policy with the right add-ons.
Now that you have a brief idea about “What is EP in car insurance”, it’s time for you to educate others.

Related articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I
Categories
Motor Insurance

Understanding your car insurance claims process

Understanding your car insurance claims process

Car owners buy car insurance so that they don’t need to face financial loss after an accident, theft, and can get coverage for repair costs, medical facilities, etc. In case of an accident or theft, the insured individual is required to place a claim. But are you aware of the car insurance claims process?.

There is a simple and definite procedure to claim the insurance facilities. Relevant and appropriate information has to be provided to the insurance company for hassle-free and quick processing. If you are wondering how to claim your insurance, this article is for you.

How to place a claim after a car accident?

This is the most common case that happens and you need insurance facilities for repairing and medical facilities. So, how would you place a claim in the case of a car accident? Let us check out.

  1. Your very first duty after an accident, if you are not severely injured, is to collect photographs and take notes. If you have been involved in an accident with another car, pen down the car number, owner’s name, model, etc. Click photographs of the driver, car, your car, and the exact scene after the accident. These are valid pieces of evidence that you would need to show to the police and the insurance company.
  2. Though it is optional, it is always a good decision to report the accident to the local police station. Get a copy of the police report so that you can show it to the company. This helps in the quicker processing of the claim.
  3. Now is the turn to inform the company. You should go step by step. So, now you would require to fill a claim form. The claim form is available on the website of the insurance company or you can collect the form from the office. Fill the form carefully giving each and every detail.
  4. Once the claiming process is primarily done the company would send a surveyor to the accident spot to see the situation and examine the severity of damage to the car. You can provide the information and photographs you collected if the surveyor asks for them.
  5. The surveyor would prepare a report providing information and detail about the accident, damage details of the car, etc. He would send this report to the insurance company and submit a copy of the report to the insured person.
  6. Once the report is made, the assistance needed by the insured would become clear. The surveyor will then accompany you to the garage and offer the required guidance.
  7. Once the repairment is done and the car repairment bills are in your hand. This bill needs to be handed over to the surveyor. He would send the bills to the insurance authority.
  8. The insurance company would evaluate the bills and provide the payment to you.

However, always remember to report the accident immediately to get the maximum reimbursement. If you report it late, you may not get the expected amount. Therefore, the very first take is to inform your insurer about the accident and let a surveyor come to review the condition. It is your responsibility to ensure that every required detail is conveyed to the surveyor with relevant supportive proofs, like photographs, etc. It is highly recommended to bring every tiny piece of information to the notice of the surveyor in order to gain the maximum benefits.

Information needed to file a claim after a car accident

What information should you collect to file a claim? There are a few things that can help to make your case stronger and can act as solid evidence. Here is a list of the basic information that you must collect before filing a claim.

  • Note down the insurance policy number from the policy card.
  • Mention the date, time, and location of the accident.
  • Try to click some photographs of the accident scene. This will help the insurer to have a clear picture of what exactly happened.
  • Provide an in-depth description of how the accident happened.
  • If another party is involved in the accident, you would need to provide the insurance and contact details of the party.
  • You would have to provide the police station name where you reported the accident along with the report and the report number.

How to file a claim in case of car theft?

Now how would you file a claim if your car gets stolen? The process is more or less like the claiming procedure after an accident. You need to follow a few simple steps, let us take a look into the procedure.

  • Your first task is to file a police complaint about the theft.
  • Share the copy of the FIR with the insurance company authority.
  • Now the insurance company would send a representative for investigation.
  • You have to wait until the investigation is finished and the claim is approved by the insurance company authority.
  • Once your insurance claim is approved, you are required to submit the RC book of the car along with the duplicate keys.
  • Now the name of the car owner would be changed from yours to your insurer’s name.
  • You will also require to submit a subrogation letter along with some other papers that the insurer would ask for. Make sure to put on the signature on the papers.
  • Once the paperwork is done, the insurance authority would go ahead with the reimbursement of the claim.

The procedure is pretty simple. You just need to act rationally whenever an accident or incident of theft occurs. In case of an accident, don’t blame the other party. Don’t panic in that situation. Let the insurer handle the situation and figure out who is at fault.

Similarly, in the case of theft, report your insurer instead of panicking. Whenever the case is genuine, the insurer is always there to help you out. So, nothing to worry about.

Before buying insurance, read out and learn about the claiming procedure so that you can take immediate action after a mishap and make the car insurance claims process seamless.

Related articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I
Categories
Motor Insurance

What is Zero Depreciation Car Insurance?

What is Zero Depreciation Car Insurance?

We have often come across the word depreciation. We usually hear it while we are reselling our machinery, especially cars, or while balancing our account books. Before understanding what is zero depreciation car insurance, it is important that you are familiarized with the concept of depreciation.

Depreciation plays a very crucial role in the motor insurance segment. Simply put it is a loss in the asset’s value. This deduction in value is done from time to time. It usually happens due to the factors like the age of the vehicle, no. of miles run, maintenance record, etc. This is the main reason why people prefer to buy second-hand cars because they get them at a reduced price.

We all know how complicated the insurance industry is. What usually happens is in case of an accident or damaging event, if the parts of your car are damaged, you won’t recover the whole amount lost.

Usually, the companies reduce the amount of depreciation on the part and then they pay you the balance. The person has to pay for the variation between the market value and depreciated part of the car.

This is where zero depreciation car insurance comes into play.

What is zero depreciation car insurance?

As the name suggests this category of insurance nullifies the depreciation factor while calculating the claim. If you buy a car insurance policy with zero depreciation then it doesn’t take into consideration the depreciation factor while reimbursing your claim.

The normal general insurance policies take into consideration the depreciation factor and then give you the amount as reimbursement. In zero depreciation, it’s not the case.

A zero depreciation policy can help you get the whole amount of compensation thus safeguarding you from all the losses that you may incur due to depreciation. You can buy this category of insurance while purchasing a new car or while renewing your policy.

Benefits of zero depreciation car insurance

1. No depreciation

As already mentioned, when you make a claim for any part of your car, the depreciation factor will not be considered while giving you the claim. The insurance company has to make the compensation which is in line with the market value of the car.

2. Major service providers

All the major insurers in the country provide this option in their offerings in the category of auto insurance. Zero depreciation is an indicator of the quality of the service provider.

3. Nullifies investment

Zero depreciation is a valuable addition to your basic auto insurance coverage. The elimination of depreciation factors makes your investment almost nil. It means that you will get a majority of all the amount that you have invested to repair your car or its parts.

4. The best option for New drivers

It is a highly suitable option for the new drivers because the fear of losing money is eliminated. We all know that the car starts to depreciate as soon as it comes out of the showroom. The new drivers are more prone to accidental situations thus it is better to nullify the depreciation aspect with zero depreciation.

Factors to consider before purchasing zero depreciation cover

After understanding what is zero depreciation car insurance. Now you should understand the factors that you should look for before purchasing zero depreciation insurance coverage.

1. Age of the car

There is a certain limit in terms of the number of years for purchasing zero depreciation insurance for your cars. You should always know that zero depreciation insurance is only available for new cars. The best thing to do is buy this while purchasing your new car.

2. Limitations on the number of claims

There are only a certain number of claims that you can make in the zero-depreciation policy. You should talk to the agent about this before making the purchase. This factor varies from one company to the other.

3. Claim settlement policy

Always look at the mechanism that your insurer is opting for while settling your claim. There is a certain percentage of reimbursement limitation on each material. For example- 50% depreciation on nylon parts. This is a bit of a complex factor about which you can talk to the representative to easily understand this.

4. Place of registration

If you have registered your car in urban areas then your premium rate is going to be a bit high as compared to the rural areas. The reason is that the cars are most susceptible to damage in the urban areas as compared to the rural areas.

5. Fuel and engine type

The fuel and engine type also plays a crucial role in deciding the zero-depreciation factor. The policies of each company vary as per the engine and fuel types.

Who should buy zero depreciation insurance?

People should also consider some personal factors before buying this option for their cars.

  • People who own luxury cars and have installed expensive parts in their cars. The reimbursement through zero depreciation will help you save a lot of money.
  • People who don’t like small scratches and dents on their cars.
  • People who are relatively new drivers and are just starting on the road.
  • People living in high-risk zones like difficult terrain or areas which are highly prone to accidents.
  • New car owners should always consider buying zero depreciation insurance coverage.

Conclusion

This was just a brief to explain what is zero depreciation insurance. You must always consult an expert and collect all the necessary information. The companies have a lot of options to offer to their customers, but you must always compare and only then choose a plan for yourself.

People apart from the above-mentioned categories should also opt for a zero-depreciation policy. This has become a very important aspect because the number of cars is increasing every day and the possibility of accidents and thefts is also on the rise.

It is always in your favor to choose the option of zero depreciation coverage. Depreciation is a factor that always leads to losses. The Zero depreciation insurance coverage will save you from the losses that may arise due to depreciation.

Related articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I
Categories
Insurance

Decoding the life of an insurance agent

Decoding the Life of an Insurance Agent

You may wonder about the opportunities as an insurance agent. You may think to pursue a career as an insurance agent or maybe you are interested in knowing what an insurance agent does. No matter what the question is, let us see how the life of an insurance agent is.

Roles and responsibilities of an insurance agent

So, the very first question is what does an agent do? An insurance agent sells the relevant insurance policies to the clients which fulfill the needs of the client. They bargain, negotiate and work to sell out insurance. An insurance agent has the freedom to choose if he wishes to work under an insurance company or function as an independent broker.

Apart from dealing with clients, they do a lot of other activities. Here are a few tasks that an insurance agent undertakes:

  • An agent helps clients in doing the paperwork and goes through the procedure after convincing them to buy insurance.
  • He/She monitors the amount to be paid and facilitates payment methods.
  • He/She attends meetings with the company to learn about new policies.
  • He/She organizes meetings with organizations to convince them.
  • An agent notes down the day-to-day progress of his or her work.
  • He/She makes sure to learn about customers’ problems and solve them to maximize customer satisfaction.
  • He/She checks on the property, asset, or any other object that is to be insured and determines the insurance risk.
  • He/She may even customize the policies to fulfill customer’s demands.
  • He/She looks after the insurance claims.
  • An agent assists clients to process the claims and get the reimbursements on time.

Essential skills of an insurance agent

  • An insurance agent has subtle yet powerful convincing skills. The approach is delicate and polite but the words are often enough to convince clients.
  • An insurance agent possesses the skill to speak fluently and confidently. Put up logic on why clients should buy insurance. A clear and confident communication compels people to purchase insurance. Communication plays a vital role as it helps to inform potential customers about the plans and schemes that can help them in the long run.
  • An Insurance agent works hard to satisfy his/her clients through customizing policies, helping them, learning about their demands, and indulging to enhance customer service quality.

The life of an insurance agent is subject to various payment opportunities based on the market conditions and the determined commission rates. Therefore, an insurance agent ensures to understand the requirement of a client perfectly such that the best plan can be pitched and sold and also satisfies the customer’s requirement.

An insurance agent also acts as a counselor and an advisor to all his/her clients. An insurance agent, for example, life insurance agent may not just be confined to selling only a life insurance policy. He or she may also offer other policies such as health insurance, theft insurance, disability insurance, financial packages [including mutual funds, and other securities], etc. depending upon the need of the customer.

The above mentioned are some of the foremost responsibilities, skills, and challenges that the Life of an insurance agent is full of. They need to master all of them in order to deliver excellent performance and succeed in their career.

Related articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I
Categories
Motor Insurance

What is First-Party Insurance?

What is First-Party Insurance?


An insurance contract is a contract between the first and second party wherein the second party or the insurer promises to pay or compensate the first party for his losses that might arise due to accidents or other loss-triggering events.

The motor and vehicle laws all across the world have made it mandatory for an individual to insure their car before getting it on the road. Multiple types of insurance categories vary as per the laws of the land. Before getting into the other details, you must first know what is first-party insurance and who is referred to as the first party.

Who is the first party?

The owner of the car is the first party. To simply put it, the first party in insurance is the person who is paying for the insurance policy. The purchaser of the policy is known as the first party. He/she is the individual who is going to receive all the benefits (compensation) whenever there has been a triggering event.

What is first-party insurance?

In this category of insurance, the first party can make the insurer liable for the losses that he/she has incurred in case of theft, damage, accident, etc. This insurance also covers the third-party losses that may arise due to the damage caused by the car owner. For example- Body injury during an accident, etc.

Procedure of filing first-party claims

A First-Party insurance claim can be initiated by the responsible policyholder. Claims can also be made by the immediate nominee specified in the insurance contract upon the death of the legal policyholder. The following method must be followed to successfully file a first-party insurance claim:

  1. Get in touch and inform the company or insurer responsible.
  2. Obtain a copy of an FIR from the regional police station where the initial accident occurred.
  3. Submit all the required documents to the insurance company.
  4. The vehicle must be submitted to a workshop as authorized by the police station if any damage is incurred to the car.

After the completion of the filing procedure, a thorough investigation is conducted by the insurance company followed by a complete analysis of the documents submitted. Based on the evidence collected, the insurance firm will approve or reject the claim filed.

Difference between First-party and Third-party insurance

In the case of first-party insurance, the beneficiary is the owner of the vehicle. Whereas, in the case of third-party insurance, the compensation and benefits are availed by the other individual who might have suffered in the accident.

First-party insurance covers the losses of the vehicle owner up to the amount decided in the policy. On the other hand, in the case of third-party insurance compensation is paid depending upon the losses suffered by the third party.

Before purchasing your insurance policy. You should always check for these laws. It will help you to purchase the policy as per the rules of the country and will also safeguard the various penalties that you may have to incur because of non-compliance.

Related articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I
Categories
Insurance

How to Launch a Complaint with the Insurance Ombudsman?

complaint

How to Launch a Complaint with the Insurance Ombudsman?

Insurance is important to ensure the financial security of our family, property, car, etc. in case of unforeseen circumstances. This is why we turn to insurance companies to get these facilities. But what if you don’t receive the amount you are owed? What if the payment is getting delayed? What would you do if the company doesn’t provide the facilities as promised?

In case of any inconvenience and difficulty, you are required to file a complaint and one of the ways to do so is via an ombudsman. Insurance Ombudsman is an initiative directed by the Government of India that allows individuals to effectively sort out complications related to a specific insurance policy outside the court of law. But how to launch a complaint with the insurance ombudsman is something not everyone is aware of.

You may not know how exactly you can reach out to the company for help. Nothing to worry about. We are here to tell you every step of how you can launch a complaint regarding your insurance difficulties.

How can you launch a complaint with the insurance ombudsman?

There are easy steps to file a complaint. But sometimes the easy methods may not work if not followed in a pattern. Hence, it is imperative to know and follow the correct sequence to launch a complaint.

So here, we will start from the simplest solution and see to what extent we may need to go to solve the issue.

Know when to file the complaint:

It is advisable to file a complaint under the insurance ombudsman when an adequate response from the concerned insurance firm has not been received within a time frame of 30 working days [from the date of the official complaint].

Contact the ombudsman office:

Contact the ombudsman office present in your jurisdiction. For an instance, if your insurance company is based in Delhi and you live in Mumbai. You must contact the ombudsman Mumbai office to file the complaint.

Filing the complaint:

The complaint can be filed by sending a letter to the insurance ombudsman. You can also file the complaint through fax or email. Although, if you file the complaint over an email, you will have to send a hard copy later.

What must your letter include:

All the necessary details and documents related to the matter, including your policy number, must be included. The documents required may vary depending upon your grievance. It is advisable to confirm everything with the ombudsman’s office and only then post the letter.

Visiting the ombudsman office:

If you visit the ombudsman office, you must fill the P-II and P-III forms. They will revert back to you asking you to fill these forms if you send your documents through the post.

Fixing of the date:

After the documents have been submitted and other formalities have been fulfilled, a date for the hearing will be fixed by the insurance ombudsman.

These were the basic steps you may take to file a complaint. It is important to note that the complaint needs to be filed within a year after your last conversation with the insurance company regarding your grievance. You must also note that the same complaint should not be pending before the consumer forum or the court, as these two institutions are the last resort for any grievances.

Related articles

Experience the power of Artificial Intelligence (A.I)

Chat with our super-intelligent A.I model and ask it anything about insurance and related products.

Chat with A.I