World news and insurance lessons that can be learnt
Natural calamities have a way of showing their wrath in the worst possible ways. That is why when hurricane Harvey struck, the consequences were not surprising. Heavy rains over a four-day period resulted in heavy floods in Texas disrupting lives and causing great damages. At least 66 people died, 30, 000 were dislodged and more than 17, 000 were rescued (Source: https://en.wikipedia.org/wiki/Hurricane_Harvey ). Back home, India also experienced its taste of calamity this year when Mumbai drowned in heavy rains. It brought back memories of Chennai floods and also the Uttarakhand disaster back in 2013. While nature shows what it is capable of, do we learn what we should have planned for?
The concept of insurance is designed to protect individuals from financial losses which might incur when a calamity strikes. But how many of your customers insure themselves or their possessions against the financial implications of natural calamities?
Very few do. Natural calamities should open their eyes to the importance of insurance. Here are some crucial insurance lessons which hurricane Harvey left behind:
Health insurance
As stated earlier, tens of thousands of people suffered injuries and serious health disorders due to heavy floods. They sought medical help and that doesn’t come cheap. US citizens had little to worry about as they had a Government sponsored healthcare program which is popularly called Obamacare. Do your customers have such a plan in place?
There is no Government-sponsored health plan in India. Whatever medical assistance you need you have to fund it yourself. India is not secure from floods or other natural calamities. Calamities occur. What you can do is prepare your customers for them. Encourage them to buy a health insurance plan and secure them financially at least.
Home insurance
How many individuals buy a home insurance policy to insure their home and its contents? Home insurance is not a very popular concept among Indians. However, in the US, home insurance is a commonly felt necessity. That is why, even Harvey wreaked havoc on people’s homes, the loss they suffered was not much. Since a home is also prone to damages, a home insurance policy should be encouraged among customers. The premiums are very low while the coverage extended is quite comprehensive. Individuals can spare a few thousand bucks to insure their homes valuing tens of lakhs, cant they?
Car insurance
Finally, we come to the all-too-relevant topic of car insurance. You must know that having a car insurance policy is legally mandatory. Thus, the choice of buying car insurance is, fortunately, not in your hands. But, did you know that damages suffered by the car’s engine due to water-logging are not covered in a car insurance policy?
In case of water-logging when there is water in the car’s engine and you start your car, the engine might get damaged. Such damages are called consequential losses Consequential losses are excluded from coverage. However, if the engine protect rider is bought, damages to the engine would be covered. Do individuals buy riders?
Many of them don’t. A car insurance policy, being mandatory, is considered a necessary burden. That is why most of your customers ignore the add-ons which are available at an additional cost. However, these add-ons come in handy at the time of disasters. So, opting for riders in car insurance is necessary. Your clients need to see the importance of riders in their car insurance policy.
Calamities come unannounced. They do not give you the chance to prepare. However, if you are cautious, you can prepare beforehand. An insurance plan helps you to prepare beforehand. It protects your client and their assets against financial losses. So, don’t wait for another calamity to strike. Learn your lesson and encourage your clients to buy an insurance plan at the earliest.
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