Readers' Corner: General Insurance

Bhargav Dasgupta, CMD & CEO, ICICI Lombard General Insurance, answers your questions

I am 52 and plan to take voluntary retirement in a year. Till date, my family and I were covered by my employer. I now plan to buy a health cover myself. Should I buy a family floater or individual covers? I have to cover my wife (49 years) and my son (18 years).

A family floater policy is normally preferred, since it allows the entire family to be insured under a single plan thus, avoiding the hassle of buying separate policies for each member. Having said this, it must be noted that family floaters generally calculate the premium based on the age of the seniormost member and, hence, might not offer the best cost equation in a wide age dispersion between individual family members. Before deciding between the two options, compare features and premium.

I am 50 and a home-maker who plans to start a tiffin service in Mumbai. I would like to take an insurance cover. What is the kind of cover I can get? And, what would be the cost?

Given the nature of the business you plan to start, you could face a situation wherein the food supplied by you is contaminated resulting in your customer(s) falling ill or leading to his/her death in the worst case. In this scenario, your customer(s) can file a legal case against you. You should purchase a liability insurance cover, which can indemnify you against such claims wherein you are legally liable for compensation to third party/ies due to injury/illness/ death. The premium for this cover will depend on the limit of liability opted for, business turnover, nature of operation, customer profile and so on, and would range from 0.25 to 2 per cent of the liability limit.

I recently read that one can now buy a longer term vehicle insurance policy. What is the advantage of doing so?

The recent guidelines issued by the regulator now allow insurance companies to offer a three-year third-party insurance policy for two-wheelers. Given that the premium gets locked in for three years, one is protected from any increase in premium during the three years of policy period. Also, it offers more convenience, as there is no hassle of renewing the policy every year.

The views expressed are expert's own. Send your queries to yourmoney@bsmail.in