Government Health Insurance Schemes
Government Health Insurance Schemes
Considering the contemporary scenario, we are witnessing that medical inflation is significantly high and reaching new heights daily. This has made accessibility and affordability to proper medical healthcare facilities quite difficult for middle and lower-income groups.
However, since healthcare is one of the primary requirements of every individual, the Government of India has launched several budget-friendly schemes to make it easier for every Indian to access proper medical care at affordable costs.
What is a Government Health Insurance Scheme?
Government health insurance schemes imply those health plans directly sponsored by the state or the central government. The chief focus of such schemes is to make easy accessibility to advanced medical treatment and care for common people without burning holes in their pockets. These schemes even encourage the improvement and development of medical facilities across every rung.
List of Health Insurance Schemes sponsored by the Government of India
Considering the latest statistics, 17 government health insurance schemes are currently active in the country. These are:
- Ayushman Bharat
- Mukhyamantri Amrutum Yojana
- Awaz Health Insurance Scheme
- Bhamashah Swasthya bima Yojana
- Aam Aadmi Bima Yojana
- Universal Health Insurance Scheme
- Central Government Health Scheme
- Karunya Health Scheme
- Chief Minister’s Comprehensive Insurance Scheme
- Employees’ State Insurance Scheme
- Mahatma Jyotiba Phule Jan Arogya Yojana
- Pradhan Mantri Suraksha Bima Yojana
- Dr. YSR Aarogyasri Health Care Trust Andhra Pradesh State Government
- Yeshaswini Health Insurance Scheme
- Rashtriya Swasthya Bima Yojana
- Telangana State Government-Employees and Journalists Health Scheme
- West Bengal Health Scheme.
Brief about each of the 17 health schemes of the Government of India:
1. Ayushman Bharat Scheme
This particular scheme has been specially crafted after considering the prospects of Universal Health Coverage or in short UHC. Since the entire Indian health service sector is vastly segmented, Ayushman Bharat targets towards making them comprehensive. This health plan focuses on ensuring uninterrupted medical care to all the countrymen, considering the entire health service sector as an unsegmented whole.
Ayushman Bharat holds 2 major components: Pradhan Mantri Jan Arogya Yojana and Health and Wellness Centres. To ensure easy availability of proper medical care, the government has set, up 150000 HWCs across the country. The government has developed these HWCs as more updated and advanced versions of the previous Primary Health Centres and sub-centres.
This scheme has been designed especially for economically weaker people. It offers yearly health coverage of up to INR 500000 per family, with a premium payable amount of INR 30.
2. Awaz Health Insurance Scheme of India
This health plan is not a central government health scheme but is issued by the Kerala State Government. The health plan offers health insurance coverage exclusively to migrant workers working in the state. It provides hospitalisation coverage and coverage for accidental disablement and death. The age of the workers must range between 18 and 60 years. The coverage extent is capped at INR 15000 for hospitalisation, INR 1 lakh for accidental permanent disablement and INR 2 lakhs for accidental death.
3. Aam Aadmi Bima Yojana Policy
This is a special personal accident micro-insurance health plan. It exclusively covers rural families who do not own any land and individuals being engaged in any one of the 45 occupational groups listed by the government. Some significant features of this scheme include:
○ Only a single member of the family, who is either the head of the family or the breadwinner of the family, is covered
○ The government pays the premium
○ The age of the policyholder must be between 18 and 59 years
○ A death benefit of INR 30000 is paid in the case of natural death. In the case of total permanent disability or accidental death, this limit is INR 75000. In the case of partial permanent disability, this limit is reduced to INR 37500.
○ An add-on scholarship benefit of INR 100 per month per child is available
○ Currently, only the Life Insurance Corporation of India (LIC) offers this scheme.
4. Bhamashah Swasthya Bima Yojana Policy
This is yet another state-sponsored health insurance plan, launched by the state government of Rajasthan. It offers cashless hospitalisation benefits to the rural people belonging to the state. This particular scheme is exclusively available to the people of Rajasthan belonging below the poverty line. They need to be included in the National Health Insurance Scheme and National Food Security Scheme.
You need a valid Bhamshah card to avail of the cashless medical facility. The coverage limit for general ailments is capped at INR 30000 and INR 300000 for critical ailments. Pre- and post-hospitalisation expenses up to 7 and 15 days are covered respectively.
5. Central Government Health Scheme of India
This scheme offers health coverage to Central Government employees, pensioners, and dependents. This health scheme is only available in 71 cities in India. It offers comparatively elaborate coverage including consultation, domiciliary treatment, health education, consultation fees, etc. Unlike several other government health schemes, CGHS also offers AYUSH coverage.
6. Chief Minister’s Comprehensive Insurance Scheme of India
This is yet another state-specific health insurance scheme, launched by the state government of Tamil Nadu. This is an indemnity plan, which provides coverage for the actual medical expenses incurred by the insured individual. Some of the important aspects of its coverage scope are:
| EXPENSES COVERED | COVERAGE LIMIT |
| Hospitalisation costs | Up to INR 150000 |
| Expenses incurred for treating certain particular ailments listed in Annexure D | Up to INR 150000 |
| Expenses incurred due to follow-ups | Determined by the types of procedures performed. Annexure E mentions the specified limits |
| Investigation procedures | Annexure F mentions the specific details |
This is a family floater health insurance scheme, covering the proposer, the spouse, their dependent children, and parents. However, the proposer must be a Tamil Nadu resident as per the residency certificate, with an annual income below INR 72000. Apart from them Sri Lankan refugees, migrant workers, and orphans can also utilise this coverage, following certain specific terms and conditions.
7. Employees’ State Insurance Scheme of India
Any non-seasonal factory worker with at least 10 employees in the organisation is eligible to utilise the coverage of this scheme. Some of the significant features of this scheme include:
It covers for self and dependents
In the case of sickness and disablement, it offers hospitalisation coverage along with cash benefits
During the employment course, if an employee passes away in an accident, the dependents tend to receive dependent benefits as a regular pension scheme.
8. Karunya Health Scheme of India
This health scheme has been introduced by the Kerala state government. It covers families with an annual income of not more than INR 300000. The insured beneficiaries tend to receive cashless treatment facilities across all the government hospitals in Kerala and also in some selected private hospitals. It offers coverage of up to INR 300000 for kidney issues, while for other issues, this limit is INR 2 lakhs. This government-induced health scheme offers lifelong medical coverage for haemophilia patients.
9. Mahatma Jyotiba Phule Jan Arogya Yojana Plan
This is also a state-sponsored health policy, introduced in Maharashtra. This current scheme has replaced the previous health scheme named Rajiv Gandhi Jeeevandayee Arogya Yojana. It provides medical coverage to Maharashtrian people spread across its 36 districts, belonging both below and above the BPL level. As per the family floater plan terms, each family can enjoy hospitalisation coverage up to INR 1.5 lakhs. This limit is extended up to INR 2.5 lakhs in the case of a kidney transplant, considering further follow-up treatment costs. This particular scheme specifies 971 medical procedures along with 121 follow-up processes, spread across 30 specific categories.
Any family residing in any of the 36 Maharashtrian states, and holding a valid yellow ration card, Annapurna card, Antyodaya Anna Yojana card, or orange ration card and farmers of 14 designated districts holding white ration cards are covered under this scheme.
10. Mukhyamantri Amrutum Yojana Plan
This is a Gujarat state government-sponsored health insurance scheme, specifically targeting families belonging to the BPL category. It covers neurosurgeries, cardiovascular surgeries, cancer, trauma, burns, renal issues, and neonatal health issues.
11. Pradhan Mantri Suraksha Bima Yojana Policy
This health scheme is for every Indian citizen belonging to the people of the age group between 18 to 70 years who holds a valid bank account. It covers total and permanent loss of sight in both eyes and limbs, any one eye or any one of the limbs, and death. The coverage is up to INR 2 lakhs for death and total and permanent disability, and INR 1 lakh for the purpose of partial and permanent disability. Even the premium amount is priced very low at only INR 12.
12. Andhra Pradesh State Government Dr YSR Aarogyasri Health Care Trust
In short, this special health scheme is termed the RACHI scheme. It is funded and sponsored by the Andhra Pradesh State Government. This health plan is specifically designed for those families living below the poverty line category. It offers hospitalisation and treatment coverage of up to INR 2 lakhs this is a family floater plan and allows the entire family to enjoy its coverage.
13. Employees and Journalists Health Scheme of the Telangana State Government
As the name suggests, this is a special health scheme that has been introduced by the state government of Telangana for all its journalists and employees. It is equally helpful for the current employees, retired employees and pensioners of this government. You can avail of cashless treatment under this policy depending on the specified terms, rules and regulations as mentioned in the plan. This makes the treatment procedure comparatively easier during medical emergencies.
14. Rashtriya Swasthya Bima Yojana Plan
This special government health scheme targets employees who work in any unorganised sector and generally do not possess any health insurance coverage. This risks their savings to a significant extent, often leading to exhaustion during medical emergencies.
This scheme has been introduced by the Ministry of Labour and Employment of the government of India. Any unorganised sector worker belonging to the BPL category can avail of the coverage of this scheme. It also offers family coverage of up to a maximum of 5 members.
15. Universal Health Insurance Scheme of India
Four public sector health insurance companies offer this particular health scheme. It has been specifically crafted to keep the requirements of people living below the poverty line. In the case of hospitalisation, it offers coverage of up to INR 30000; INR 25000 for accidental death; and loss of earnings, it provides INR 50 per day for up to 15 days.
The premium amount is highly subsidised and significantly low. For any individual plan, the current subsidy in premium is INR 200; INR 300, for a floater plan covering a maximum of 5 members; and INR 400 for a plan covering 7 family members.
16. Yeshaswini Health Insurance Scheme of India
The official name of this government health scheme is Yeshasvini Cooperative Farmers Health Care Scheme. Karnataka State Government launched it back in 2002. It provides health coverage to the farmers of Karnataka. The benefits of this scheme can be utilised for 823 specified medical treatments and other miscellaneous medical expenses. All the farmers who are members of the Rural Cooperative Society of Karnataka can avail of this coverage. The insured individuals must contribute INR 250 and INR 710 for Rural and Urban Yeshasvini plans respectively.
17. West Bengal Health Insurance Scheme
As the name specifies, this scheme has been introduced by the West Bengal State Government for its employees. Any employee of the Indian Administrative Service, Indian Forest Service, Indian Police Service, retired AIS officers and pension holders of the West Bengal Government can utilise the benefits of this health scheme.
If the insured individual avails of in-patient hospitalisation treatment within West Bengal or 9 other specific hospitals outside West Bengal, the benefits of this plan can be utilised. It also offers OPD coverage of 15 types of specific ailments.
It was renamed as West Bengal Health for All Employees as well as Pensioners Cashless Medical Treatment Scheme 2014, back in 2014. For much-insured individuals, this scheme allows cashless treatment of up to INR 1 lakh per year.
Benefits of government health insurance schemes
Some of the most highlighting standard benefits of government health insurance schemes operating in India include the following:
- Indoor treatment facilities at both government and other empanelled network hospitals
- Diagnostic health investigation coverage at empanelled and government hospitals and healthcare centres
- Medicine coverage
- Cashless treatment facilities in listed diagnostic centres and hospitals
- Reimbursement facilities during medical emergencies
- Accessible to the comparatively weaker section of society
- Covers a considerably wide range of ailments and other critical illnesses.
Features of government health insurance schemes
Some of the chief characteristics of government health insurance schemes include:
- The policies are available at a very reasonable cost
- Specially crafted to encourage every person even those belonging to the BPL category to avail of these health insurance facilities
- Ensures a basic health cover for economically weaker people
- Assures the policyholders to have access to proper healthcare opportunities at a reasonable rate
Basic health insurance plans Vs. Government health insurance schemes
| FEATURES | GOVERNMENT HEALTH INSURANCE PLAN | A BASIC HEALTH INSURANCE PLAN |
| PREMIUM | Low premium | Comparatively higher premium |
| DISCOUNT | Heavily discounted due to government sponsorship | Depends on market competition and trends |
| NCB BENEFIT | Not available | Available |
| COVERAGE | Offers coverage with an upper limit | Ensures comprehensive coverage of almost all medical expenses |
| AMOUNT OF SUM INSURED | Low to moderate | Comparatively higher, leading to a higher premium amount |
| CUSTOMERS | Open to all with a special focus on the economically weaker section of society | Anyone can access it |
| ELIGIBILITY | Available chiefly to the lower income groups | Available to all |
| POLICY PURCHASE TIME | May be time-consuming | Instant Purchase |
| NETWORK HOSPITALS | A wide network including both public and private hospitals | Extensively private hospitals |
| MATERNITY BENEFITS | Available only for a single child under specific circumstances | Available, depending on the terms of the plan |
| AMBULANCE COSTS | Available only in selected plans | Available in almost all plans |
| DOMICILIARY COSTS | Not available | Available, depending on the scope of the plan |
| ONLINE RENEWAL | May or may not happen | Possible |
| CUMULATIVE BONUS | Not available | Available for claim-free year |
| HEALTH CHECK-UP | Not covered | Covered in certain plans |
| MONTHLY PREMIUM PAYMENT FACILITY | Not available | Available in certain plans |
| TAX BENEFITS | Not available | Available u/s 80D of the IT Act |
Frequently Asked Questions
Different plans have different sets of eligibility criteria. You can check the individual plan concerned before purchasing.
Yes, however, you have to submit other valid documents specifically essential for purchasing a particular government health plan.
Not all government health plans provide online availability. You need to clarify before buying.
Under standard circumstances, any cosmetic medical procedure, maternity costs, OPD treatment costs, and dental treatment costs do not remain under the purview of any government health plan. However, each plan provides different sets of exceptions. You need to clarify the exact norms of the plan concerned before proceeding.
Here, the premiums are determined depending on the total number of individuals covered under the particular policy. Under certain circumstances, these schemes require beneficiaries to pay a pre-fixed amount as a yearly premium. However, it is best to know the details of your chosen scheme beforehand prior to purchasing.
No, certain schemes are sponsored and funded by the central or the state government, while some others require the policyholder to pay a small premium.
Generally, an Aadhaar card is sufficient as valid identity proof. However, depending on the terms and conditions of the specific plan, it may require income proof, residential proof, etc.
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Bundling tends to make policy management easier and could quite often lead to some savings because most insurers want to be loyal to their customers; they wish to encourage them to become multi-policy customers and offer them some sort of discount on their premiums. Actions Talk about your bundled policies with your agent in insurance Compare a bundle offer to an individual policy to identify savings Bundle policies should be sufficient enough for the coverage of your business Finally, Raise Your Deductible Deductible refers to the amount that one needs to pay before making a claim. In general terms, the higher is the deductible level on the policy then more the insurance premium. The higher your deductible is going to be, the more you are going to pay for each and every future claim. That will make the company expose itself towards lesser risks and force them to lower down your monthly or annual premium. But it’s a good thing to remember that you have money set aside to pay for the extra cost of the deductible if and when it is time to submit a claim. Being able to afford a higher deductible is not in your best interest if you do not have money in savings available to you at the time you will be submitting your claim to pay for the extra cost. Action Take a look at what your current deductible is. Compare how much in premium savings you’d receive with higher deductible options. You should have an emergency fund in case you need to claim in future due to deductibles. Carry Out Risk Management and Safety Measures You would want to consider the fact that sometimes, insurance premiums are a function of how risk-prone your business seems to the insurers. The lesser you do in reduction of risk, the lesser the likely, your insurer is going to reward with lower premiums. For example, safety nets will minimize your chances of having accident, theft or even damage; therefore it will significantly minimize your cost on insurance. This would ensure organizations with employees have a much safer working environment. This way, even conditions of working injuries can be worked upon to being totally eradicated; such incidents influence the comp premium risk of the workers. Installation of security systems, fire suppression systems, and cybersecurity measures reduce your overall profile for risk. Steps to Action -Risk Assessment and Safety Measures End Install Security Systems (alarms, cameras, etc.) and Fire Suppression Systems Train your staff on the issue of safety from time to time Invest in cybersecurity especially when your business has sensitive information to handle Improve Your Business Credit Rating Business How much will it cost: You will pay less on your commercial insurance premiums if you have a good credit rating score for business. 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Price war is no option with faithful clients sometimes you must change a provider since you feel that another will sell you at better value. Review coverage from a “best value based on dollar coverage” standpoint rather than trying to find the least expensive. You want low-cost premiums, but you also want assurance coverage exists for your business. Action items Get quotes from three different insurance providers and
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Top 5 Business Insurance Policies Every Entrepreneur Should Know About Insurance has come to play an extremely crucial role in the modern fast-paced and uncertain business environment because of its elements that protect businesses against many kinds of risks that may crop up. If you also propose beginning with a new business or managing an already well-established business, which would help protect your business from losing finances and create sustainability for long periods of time, then you should know the right insurance policies. Not all kinds of insurance become inevitable to entrepreneurs and other people who do business in order to avoid risking their ventures. Top five business insurance policies that every entrepreneur should know. General Liability Insurance This might be the very reason why General Liability Insurance is one of the most basic forms of commercial insurance that will keep your business safe from claims against such an occurrence, if through your transactions or nature of business, you somehow damage other people’s property or else causes some damage in the health or any other type of harm. Some Benefits Property Damage: General liability insurance that relates to loss or the cost to rebuild properties due to the presence of your business. Bodily Injury: If one of your customers or many others, for that matter, gets hurt in your place of business, such insurance will compensate them for medical care and attorneys’ fees. Legal Liability: General Liability pays costs and damages if someone sues your business for the argument that your business has caused injuries or property damage too. Professional Liability Insurance, also known as Errors & Omissions Insurance This is also sometimes referred to as Errors and Omissions (E&O) Insurance. Its name probably has something to do with the practitioners who often use it most: lawyers, accountants, and even realtors do so much that this kind of insurance could be described after these types of professionals. The coverage of such insurance would protect your business against negligence, mistake, and failure to deliver promised services. Main Benefits : Litigation against Customer: Indeed, if the customer thinks that the service you offered to the client was a bad mark or something they lost because of your service, this cover will manage to get you money in order to indemnify for money spent on lawyers for the defense of your business. It contains some mistake and negligence that most accidents were caused due to negligence while giving your service. Such negativities that involve settlements and lawyers. Protects Reputation: It always protects your business from professional negligence claims, which tend to drag your business to court-that step always protects your business reputation. This means if an organization owns property or is leasing one, then the compulsorily insured property is a commercial property. It mainly insures physical assets such as a building or part of it, equipment, stock, furniture, and all other business properties against loss caused by dangers such as fire, theft, and natural disasters. Some of the main benefits Protection Against Natural Calamities: If any of these calamities threatens your property, be it fire, flood, or any other, it would pay to have your property restored or replaced. Commercial Equipment Insurance: This kind of insurance will cover your essential equipment, which includes computers, machinery, and other office furniture, so you can get back to business again in no time after an incidence. Inventory Insurance: This is pay put together by replacing the goods if your stock gets either destroyed or stolen so that you do not miss sales in time. Workers’ Compensation Insurance If you have employees, Workers Compensation Insurance is also the right thing to do well, and most states will require it. Workers compensation insurance pays your employees if they get hurt or fall ill at work. Major Advantages Healthcare Costs: The cost of medical and rehabilitation of injuries or diseases to which an employee is exposed on the job are provided under workers’ compensation. Wage Replacement: It also covers your business in case the worker cannot go to work, providing wage replacement. Legal Protection: This also protects the company from some litigations resulting from injuries since most of the states have disallowed people from taking lawsuits to their employers if they are receiving workers’ compensation. As these heights of digital threats are on the rise, it was realized that business organizations dealing with sensitive information from customers or money transactions electronically have to be in an increasingly demanding market for Cyber Liability Insurance. This particular type of insurance covers the loss resulting from lost data hacking and other types of cyberattacks. Key Benefits: Data Breach Coverage: cyber liability insurance will replace the money that it will cost to inform the customers, to notify them of credit monitoring, and to rebuild the lost data. Laws and Regulatory Fines: in case your company is liable for data breach of personal data, then this coverage can help relieve some of the legal fees to defend yourself besides other fines that you will face a probability of being charged with because you were breaking some regulations. Others include Reputation Management: At times, an attack may affect the reputation of your business. Cyber liability insurance therefore may also include public relation ventures that help recover reputation. Other thoughts for entrepreneurs: Except for these general types, there are the very specific types of business insurance that entrepreneurs might be interested to learn more about depending upon industry or geographic location or particular needs of the business. Other policies that might be useful to carry: Business Interruption Insurance: It will cover loss income in case your business had temporarily to shut down, for instance, a huge damage by natural disaster. Product Liability Insurance: Product liability insurance covers businesses as a product liability insurance form for the firms associated with the manufacturing or distribution of products. Such an insurance deals with claims involving the defects of the product or safety on the product. Business
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How to Build a Comprehensive Business Insurance Package Any firm needs to armor itself against any form of risk in this unpredictable world. Thereby, protecting one’s firm still calls for much importance than at any other time. An established business insurance package will ensure that your operations run according to schedule even during such times when unexpected things are springing around each corner. It is pretty confusing to those new to the game, but the world of business insurance can be explained in simple steps. Below are the steps on how you can construct an entire business insurance package to ensure you are fully covered in case of varying liabilities and losses. Business Insurance Package What is actually a business insurance package? Actually, a business insurance package is an offer of different insurance deals that will be meant to address varied kinds of risks that a given business may expose to. The specific bundle of a business insurance package can be general liability, property insurance, professional liability insurance, workers’ compensation amongst other risk components. All these can usually safeguard your business from any financial losses that it might incur due to accidents, lawsuits, natural disasters, and other calamities not yet foreseen or even in the imagination. Step 1: Categorizing Your Business Risks As you come up with an integrated insurance product, there is the need to identify particular risks of your business. Since no two businesses are similar, these factors become very important in classifying possible risks of your business. Among them, some are general and affect most businesses: Risk that emanates from physical characteristics: This is loss to the office, equipment, or stock occasioned by fire, theft, and causes including natural calamities. Liability-based risk: The risk precipitated out of a case of injury, negligence, and breach of contract lawsuit Employee-related risks: Injuries or illnesses that will adversely affect the employees at work and can be treated either medically or benefits fund-wise Industry-related risks: Risk is specific to a given industry; cyber risk is an industry-specific and particular only to IT companies. Malpractice risks are specific to the medical fraternity only. Knowing your risks may as well help you know which type of cover will go into your package. Step 2: Critical Types of Insurance Coverage With a much greater awareness of what you might lose, it’s high time to find some insurance covers that may be accessible to you. There are some essential kinds of cover every business would do very well to consider the following: Liability Insurance-General This would also include claims of lawsuits rising against the business over third parties for either actual or perceived physical or personal injury or damages to third party property like libel or slander. Most businesses need commercial property insurance because it would prevent lawsuits filed against a company in court and also some forms of claims brought about through the normal functioning of any business. Commercial Property Insurance Commercial property insurance protects your business’s physical assets: buildings, equipment, products, inventory, and furniture. It will cover you from losses that can occur through fire, theft, vandalism, and sometimes natural occurrence. This form of property insurance is also not required when purchasing ownership or leasehold interest. . Errors and Omissions Insurance Liability Coverage Errors and omission insurance, also referred to as professional liability, is supposed to cover the clients against third-party civil actions over unintentional errors or omissions represented by negligence. Such cover will offer defense costs and damages. This is one of the minimum covers for any business that involves professional practice or renders advice. It covers claims based on negligence, omissions, or errors that leave a client liable to lose money. Such businesses are risky because their activities are complex. Examples of such industries include legal services, accountancy, consultancy services amongst others . Workers’ Compensation Insurance That would be work-related injuries and illnesses for employees who get injured or fall sick for them to be compensated. Most states will require you to obtain this once you hire an employee. You’ll find yourself covering medical expenses, rehabilitation as well as lost wages while an employee is in the hospital. It will also protect your business from emerging with some liabilities of an injury-liability lawsuit. Business Interruption Insurance That is, if a covered loss-for example, hurricane or fire-disrupts your business operation, profits are made good. Other benefits of business interruption insurance include benefits on lost earnings and cost of continuing expenses and relocation expense if you should move your business temporarily so you may resume operations as soon as possible after the interruption. Other Insurance Coverage Of course, the above major policies form a business insurance package, but most businesses are structured in such a way that they need coverage beyond the policy above for certain industries. Consider adding some of the following options depending on your industry, location, and size of business: Cyber Liability Insurance This risk comes from the end as cyber threats and data breaches pose it in this new era of technology. The cover also includes costs incurred on notification when the data breach happens, lawyer fees, and repair for damages. A company that collects such sensitive data about customers’ needs such a kind of coverage. Product Liability Insurance If your company manufactures or sells goods, it could be given a form of protection against damages or injuries caused to other persons because of a defective product-product liability insurance can offer relief in that aspect. It will benefit your business both economically, in terms of expensive battles in courtrooms, and loss incurred from a defect in the product. Commercial Auto Insurance Liability insurance covers all forms of liabilities against your business. And your business is covered by liability with any cars, may be a minivan or is a huge truck. Several risks, including physical damage, liability coverage, medical payments, and comprehensive along with collision coverages get protection with this option. Commercial auto insurance will be
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General Liability Insurance Vs. Professional Liability: What Does Your Business Need? Entrepreneurship exposes you to risks which are mostly tied to dealing with the customers, handling the employees, and perhaps doing your services. Business insurance can only be fundamental in covering risks and damages that may come when doing so. But choosing what to get sometimes gets tough because it is, after all, between general liability and professional liability. The point of contention is that both insurances cover different risks, but actually knowing the difference between general and professional liability can make a huge difference in ensuring that your business is really covered with the right insurance. What is General Liability? General Liability General liability is a type of insurance coverage for your business that will protect your business from claims of bodily injury, property damages, and advertising injury. Generally, general liability is considered one of the very basic policies most business concerns require as it offers far-ranging protection against common risks that occur in operations. General liability insurance covers This one will cover the expenses on their medical cost, your attorney fees and even settlement if a person gets hurt because of any business activities or while being on your company’s premises. Property Damage: This one will pay for the repairing or restoring of damages if your business damages any other person’s property. This would be the claims that occur on the basis of sums for slander or libel or for copyright infringement in the advertisements running for your business . Who needs general liability insurance? Most businesses, in most industries will obviously be able to take benefit of general liability insurance. Whether you run a small retail establishment, a restaurant, or are a contractor, general liability insurance provides core protection from general perils. It is particularly useful to businesses that get to interact with the public, are located inside buildings, or handle customers’ property. What is Professional Liability Insurance? It is also known as errors and omissions (E&O) insurance. This is an insurance cover that safeguards professionals practicing professional services or offering advice. They help safeguard a business from negligence, errors, omissions, or mistakes attributed to them causing financial loss to a client. What is Covered Under Professional Liability Professional liability normally covers Professional liability would deal with legal costs that may emerge while it is alleged that your business did not deliver services as they should have been; hence there was a financial loss for a client. Errors and Omissions Moulded on the principles, Errors and Omissions refer to mistakes, oversights, or omissions that may occur whilst in the process of providing professional services. Cost coverage against litigation: Professional liability pays for lawyers if there exists a frivolous lawsuit filed against you Who to Buy Professional Liability Insurance? Professional liability insurance is actually a necessary business product for any business engaged in the specialty service of consultancy, accountancy, law, real estate, and health care amongst others. It is specially for a business that quickly can bleed its clients out through an apparently innocent misstep or omission. For example, an investment advisor may give unwanted investment advice and end up losing for his client, he can sue for negligence. Diverging Factors between General Liability and Professional Liability The two types of insurance, liability and general liability, therefore, differ because each provides insurance against a different type of risk. The factors of divergence include: Scope of Coverage: General liability comes to promise protection from the risk of physical injury or damage to property. Professional liability protects against financial loss resulting from mistakes or omissions in professional services. Industry Suitability: General liability is a must for any organization that does business with the public, has a place of business, and or uses manufactured products. Professional liability is essential for any business that has or offers specialty advice or service where something can go wrong financially. Claims Recovered: General liability most often covers claims of third parties’ physical injury or damage. Professional liability is to protect against all forms of errors, omissions, and other forms of negligence in services. Do You Need General Liability and Professional Liability Insurance? This sometimes applies both general liability insurance and professional liability insurance. For instance, there is a marketing agency that requires general liability to act as cover, just in case the third party is injured or property damage occurs through events or meetings. At the same time, they might be asking for professional liability insurance against lawsuits of bad marketing advice, which escalates their client’s financial loss. Features to look for before choosing an insurance company Type of Industry and Business: The type of business you are engaged in is what goes a long way in determining the kind of insurance you need. If your business deals with one on one contact or third-party properties, then general liability insurance is absolutely essential. When you are into professional services, then professional liability insurance becomes very crucial. Risk Exposure: Clearly identify what your business is at risk to. For instance, if you are a construction firm, then the risks of property damages are higher and at a greater likelihood of personal injury that will require general liability. In law firms, the probable claim is against negligence, making professional liability more crucial. Client Contracts: Certain clients will insist that you secure general and professional liability insurance coverage before you transact business with them. Always refer to your contracts to determine if any specific coverages are required. Conclusion General liability insurance and professional liability are complementary forms of protection against risks that most businesses will face. While general liability is important for offsetting the physical risks, like physical injuries and damages to other’s properties, professional liability is also very significant for businesses whose lines of business are fundamentally services, facing exposures to potential errors, omissions, or negligence. Identify what type of insurance is appropriate for your business by viewing the industry that you are entering
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Why Big Businesses Need Commercial Umbrella Coverage? The risks associated with sophisticated occurrences such as legal liability and property damage of employee-related incidents happening within the firm are today characterized by high numbers of exposures to such incidents in large firms. Though most businesses have primary coverage for these occurrences, even the best of such standards do fail sometimes. That is where commercial umbrella coverage comes in. This liability coverage is more than the usual policies issued against large corporate entities; it will give cover to these corporations in case of sudden financial loss. What is Commercial Umbrella Insurance? Commercial umbrella insurance is an excess liability coverage. It kicks in when the limits of a corporation’s main insurance policies-for example, general liability, auto liability, or workers’ compensation-are exhausted. To put this another way, if a company were being sued and the amount to be paid was greater than what the primary liability insurance would pay, commercial umbrella insurance would pay the excess amount so that the company wouldn’t lose. Why Corporate Giants Require Commercial Umbrella Insurance Preventive measure against massive claims A large corporation is more likely to suffer due to its extensive scale and size, large workforce, and massive volumes of business. The possibility of huge claims is that they easily surpass standard policy limits. Be it a multi-million-dollar lawsuit or a severe accident in the workplace, fiscal implications could be huge. Commercial umbrella insurance goes a notch higher than normal protection of commercial policies to offer other types of cover that would ensure protection for business assets from the effects of a probably unknown incident. All kinds of risks Large corporations are cross-industry, cross-geography, and cross-jurisdictional. This makes them prone to all types of risks. Insurance can thus offer cover for most lines of insurance thereby protecting the companies against such risks as bodily injury to third parties, property damage, and even legal costs to defend a lawsuit. General protection is offered whereby most cases are covered. Emergent Risks Protection Among the emergent risks in the business environment include: The business environment is always in flux, and, like any change, it carries emergent risks along with it. Some of the most dominating examples of these emergent risks include cyber threats, claims regarding workplace discrimination, and liabilities related to the environment. Amongst all of these examples, some of them fall under the comprehensive umbrella of primary insurance, while the rest have to bear all the financial costs incurred by such emergent risks. Commercial umbrella insurance provides corporates with adequate cover to cope up with situations emerging due to risks that evolve with scale and complexity in their operations. Protection for high-value assets Larger corporations also own valuable assets like office buildings, factories, machinery, and fleets of vehicles. Any liability or damage related to these assets results in heavy financial losses if a corporation is held liable for an accident or damage that exceeds its general liability limits. Such differences are covered by commercial umbrella insurance. It is especially important for such corporations owning high-value assets with long-term health in terms of finance. Litigation Costs Litigation of lawsuits may take a long period and is expensive Even an organization might be involved in the lawsuit due to a workplace accident, a case of product liability or even a breach of contract Lawfully carried litigation that usually has an over cover of what they can claim of costs on the defense under the core insurance policies. Commercial umbrella insurance supplement resources to pay for these legal costs so that corporation is not legally overridden. Example scenarios for which commercial umbrella insurance must be used Claims for Product Liability: Consider for example a business dealing in the manufacture of very common and used products in which a fault is discovered leading to mass havoc or destruction. A fair number of people will sue the business. Even with the purchase of product liability insurance, the number of claims could quickly become more than policy limits and the business will be liable for the remainder. A commercial umbrella policy would protect the bottom line against liability over that amount. Industrials Workplace Accidents: Building sites, manufacturing premises, and huge office buildings are just the environments where the best laid safety plans can still go wrong. Perhaps even a serious injury or death claim would be outside of the company’s insurance umbrella. Commercial umbrella insurance will keep corporate America running without rocking the boat by covering huge claims without disrupting business or financial security. Auto Liability: Fleet operation always exposes a business firm to the possibility of a severe auto accident that may lead to very severe bodily injury claims or property damage claims. And even when a company holds commercial auto insurance, a severe accident may gobble up the limit of such insurances. That is why there is commercial umbrella insurance in place so that the business does not end up naked in such incidents. Why Commercial Umbrella Insurance Affordably priced insurance coverage Of course, the biggest benefit that one can derive from commercial umbrella insurance coverage is extremely high coverage limits for an altogether reasonable premium. What a company is left holding but adding billions of dollars to a variety of primary policy limits, rather than purchasing an umbrella policy that comes paired with extending coverage over multiple policies, for a much more modest premium. Peace of Mind This would give corporate bodies that added layer of protection, hence being able to manage risks better with peace of mind. Executives and stakeholders will be assured that the company has a broad layer of liability protection and therefore focus more on growth and innovation knowing it will not continually lose much sleep over large financial setbacks. Business Reputation Improved They shall have a business which is well covered against risks. More than that, prudent practices and expectations of the business would be set to prepare for the unexpected, thus vesting
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