INTRODUCTION TO INSURANCE:

In insurance, the insured makes payments called "premiums" to an insurer, and in return is able to claim a payment from the insurer if the insured suffers some kind of loss. This relationship is usually drawn up in a formal legal contract.In one classic example of insurance, a ship-owner insures a ship and receives payment if the ship is damaged or destroyed. This example is one of the earliest uses and developments of concepts like insurance. Interestingly, ships are now more often insured through risk pooling and spreading organizations such as Lloyd's of London because the loss of a large ship going down is too great for one insurer to accept.In the case of annuities, such as a pension, similar concepts apply, but in some sense in the reverse. When applied to annuities, the terms risk and loss are somewhat different from traditional insurance as they concern the chances of living beyond life expectancy and the need for income during the period between annuitization and death.Insurance attempts to quantify risk by pooling together a large number of risks. This makes use of the law of large numbers. As applied to insurance, this means that the greater the number of similar risks, the greater accuracy with which insurers can estimate the overall risk.

For example: Many individual people purchase health insurance policies and they each pay a small monthly or yearly premium to an insurance company. When a policyholder gets ill, the insurance company provides money to cover medical treatment. For some individuals the insurance benefits may total far more money than they have ever paid into the insurance policy. Others may never make a claim. When averaged out over all of the people buying policies, value of the claims even out. Insurance companies set their premiums based on their calculated payouts. They plan to take in more money (in premiums and in profit from the float, see below) than they pay out in the end to cover expenses. For-profit insurance companies set their rates to make a profit rather than to break even.Insurance companies also earn investment profits, because they have the use of the premium money from the time they receive it until the time they need it to pay claims. This money is called the float. When the investments of float are successful, they may earn large profits, even if the insurance company pays out in claims every penny received as premiums. In fact, most insurance companies pay out more money than they receive in premiums. The excess amount that they pay to policyholders is the cost of float. An insurance company will profit if they invest the money at a greater return than their cost of float.

HISTORY OFINSURANCE:Insurance probably made a beginning in the ancient land of Babylonia In the 18th century B.C., Babylonian king Hammurabi developed a code of law, known as the Code of Hammurabi, which codified many specific rules governing the practices of early risk-sharing activities. For instance, the code dictated that traders had to repay merchants who financed trading voyages unless thieves stole goods in transit, in which case debts would be cancelled.This was similar to the system of insurance known as bottomry which existed in Phoenicia in 1200 B.C. In this system, backers loaned money to merchants to finance voyages. Merchants offered their ships (the hull was known as the ships bottom) as collateral for such loans. When a trip succeeded, the merchant would pay the trips backer the original loan plus interest, the equivalent of a premium. If a ship went down on its voyage, the trips backer would cancel the merchants loan. The Greeks and Romans developed the earliest systems of life insurance. They formed societies which paid dues that went toward paying for the burial of members. Sometimes these societies also paid for the living expenses of deceased members families. During the Middle Ages (5th to 15th centuries A.D.), workers joined together in craft. Many guilds, particularly in England and Italy, provided benefits to workers and their families in the event of illness or death.

INSURANCE PRINCIPLES:Main principles of Insurance:

Utmost Good Faith (Uberrimae Fides):

As a client it is your duty to disclose all material facts to the risk being covered. A material fact is a fact which would influence the mind of a prudent underwriter in deciding whether to accept a risk for insurance and on what terms. The duty to disclose operates at the time of inception, at renewal and at any point mid-term.

Indemnity :

On the happening of an event insured against, the Insured will be placed in the same monetary position that he/she occupied immediately before the event taking place. In the event of a claim the insured must:

Prove that the event occurred Prove that a monetary loss has occurred Transfer any rights which he/she may have for recovery from another source to the Insurer, if he/she has been fully indemnified.

Subrogation:

The right of an insurer which has paid a claim under a policy to step into the shoes of the insured so as to exercise in his name all rights he might have with regard to the recovery of the loss which was the subject of the relevant claim paid under the policy up to the amount of that paid claim. The insurers subrogation rights may be qualified in the policy.In the context of insurance subrogation is a feature of the principle of indemnity and therefore only applies to contracts of indemnity so that it does not apply to life assurance or personal accident policies. It is intended to prevent an insured recovering more than the indemnity he receives under his insurance (where that represents the full amount of his loss) and enables his insurer to recover or reduce its loss.

Contribution:

The right of an insurer to call on other insurers similarly, but not necessarily equally, liable to the same insured to share the loss of an indemnity payment i.e. a travel policy may have overlapping cover with the contents section of a household policy. The principle of contribution allows the insured to make a claim against one insurer who then has the right to call on any other insurers liable for the loss to share the claim payment.

Insurable Interest:

If an insured wishes to enforce a contract of insurance before the Courts he must have an insurable interest in the subject matter of the insurance, which is to say that he stands to benefit from its preservation and will suffer from its loss. In non-marine insurances, the insured must have insurable interest when the policy is taken out and also at the date of loss giving rise to a claim under the policy.

Proximate Cause:

An insurer will only be liable to pay a claim under an insurance contract if the loss that gives rise to the claim was proximately caused by an insured peril. This means that the loss must be directly attributed to an insured peril without any break in the chain of causation.

MEANING AND DEFINATION OF INSURANCEMEANING

Insurance is financial service. It is pooling of risk in a contract of Insurance, the insurer undertakes in consideration of a sum of money to make good the loss suffered by the insured against specified risk or any other contingency. There are two parties and insurance contract, insurance company and the insured party. The document laying down the terms of the contract is called insurance policy. The property, which is insured, is the subject matter of insurance. It may be insured against loss arising uncertain events in the form of destruction or damage to the property or death or disablement of person.The interest, which the insured has subject matter of insurance, is known as insurable interest depending upon the subject matter, the types of insurance are life insurance and general insurance. In case of life insurance a specified amount becomes payable on the death of insured or upon the expiry of specified period. General insurance covers losses caused by fire, accident and marine adventures

DEFINATION

Insurance is a financial arrangement that redistributes the cost of unexpected losses.

According to D.S.Hansell, Insurance may be defines as a social device providing financial compensation for the effects of misfortune, the payments being made from the accumulated contribution of all parties participating in the scheme.

Insurance is a device to protect again risk or a provision against inevitable contingencies or a co-operation device of spreading risks.

According to Riegel and miller, Insurance is a social device ware by a uncertain risk of individuals may to combine in a group an thus made certain small periodic contributions by the individuals, providing funds out of which those who suffer losses may be reimbursed.

INTRODUCTION OF INSURANCEInsurance companies in India are governed by the insurance Act 1938, though consequent to the nationalization of life insurance business 1956, the provisions of the respective legislations apply to them. Insurance is a means of protection of the economic value of assets. It is method of spreading over large number of persons, a possible financial loss, which cannot be borne by individual. The occurrences which cause any damage to the assets are called perils.Insuranceis a financial device for transferring or shifting risk from an individual orentity to a large group with the same risk. This is accomplished through a contract,the insurance policy, with an insurance company. Under this arrangement, the individual,along with other insureds, pays a sum to the insurance company. In turn, theinsurance company agrees to pay an amount of money (reimbursement) to the individual,or on behalf of the individual, if the events described in the policy occur.Insurance is used to indemnify, or restore, a policyholder to a pre-loss condition. Theindividual accepts a known cost, the premium, in exchange for payment of a large,uncertain financial loss. The insurance company combines, orpools, a large numberof similar units (homes, autos, businesses, etc.) and thus can predict losses withinthese units.

Insurance is social device to reduce or eliminate a risk of loss to life and property. A group of individuals transfer risk to another party in order to combine loss incurred. It includes statistical prediction of losses and provide for payment of losses from fund contributed by all members who transfer risk. Thus collective bearing of risk is immense. Life insurance exist because there is uncertainty regarding the timing and manner of death; though it is certain.

With largest number of life insurances policies in force in the world, insurance happens to be a mega business in India. It is business growing at 15 to 20 percent annually together with banking services it adds about 7 percent of GDP. Gross premium collection percent of GDP and funds available with LIC for investmentAre 8 percent of GDP. Get nearly 80 percent of the population is without life insurance cover. The insurance sector to the extend can enable investment in infrastructure development to sustain economic growth of country. Insurance companies not only provide risk cover to infrastructure project they also contributes long term capital. HISTORY OF INSURANCE

INDIAN INSURANCE SECTOR

There are evidences that marine insurance was practiced in India some three thousand years ago. In earlier days travellers by sea and land where exposed to risk of losing their vessels and merchandise because of piracy of the open seas. The practice of insurance was quite common during the rule of Akbar to Aurangzeb, but the nature and coverage is not well known. It was British insurers who introduced general insurance in India in its modern form.

The Britishers opened general insurance in India around the year 1700. The first company known as the SUN Insurance office ltd. Was setup in Calcutta. This was followed by several insurance companies on different parts of the world in the field of marine insurance. In 1972, general insurance business was nationalizing by the government of India by forming general Insurance Corporation. The following four companies have been authorized to carry on the general insurance business including marine insurance in the country viz. The national insurance company, New India Assurance Company, /Oriental Fire and General Insurance Company and Untied India Fire and General Insurance Company.

Insurance penetration in India is just 4.6 percent in case Life Insurance and 0.61 percent in general insurance (Annual premium paid as percentage of countries GDP). In terms of insurance density, the number is even more alarming. In developed countries like united states, insurance density is 33 times that of India and in united kingdom it is 73 times and in japan it is 65 times. Even a country like Thailand, it is double that of India.

INSURANCE ACT, 1938:

The insurance Act was passed 1938 and was brought into force from 1st July 1939. It was a well balance and was the first comprehensive piece of insurance legislation in this country governing both life and non-life branches of insurance this Act provided to prevent mushrooming of companies, to enforce working on sound principles, to prevent misappropriation of fund and to protect the assets.

The Act was wide and more comprehensive. There was strict control over the insurance business. Since 1938 there were 6 amendments up to 1945. In 1945 it was deemed necessary to protect the interest of insured companies. Therefore a committee was appointed under the chairmanship of Shree Kavsaji Jahangir. On the basic of the committees recommendation, and amendment bill was made on 18th April 1980 by the parliament. As per the amended Act the total right was with central Government. It controls the insurance business by appointing controller of insurance. The insurance companies violating the rules and regulations are penalized under this Act.

This Act applies to all types insurance business life, fire, marine, etc. done by companies incorporated in India or elsewhere

UMBRELLA INSURANCE:

Umbrella insurance is extra liability insurance that you purchase in addition to your regular insurance policies. As its name implies, umbrella insurance sits "on top of" your other insurance policies like an umbrella, to provide added financial protection in the event that other policies cannot cover the loss.For example, let's say that you rear-end a luxury vehicle, and it turns out that you must pay far more than your insurance coverage allows. If you don't have an umbrella insurance policy, you'll need to figure out where to get that money. But if you do have umbrella insurance, then that policy would kick in and you would likely pay nothing out of pocket.It used to be that only the very wealthy needed umbrella insurance. But anyone can be sued for any reason at any time, and umbrella insurance provides added protection against losses. If someone falls on your front steps or your tree falls on a neighbor's house during a storm, they can successfully sue you for damages. Anything that happens on your property or because of your property is fair game and not always covered by traditional homeowners' insurance. Umbrella policies provide protection in many situations that usual liability policies don't cover. While being wealthy isn't a prerequisite for needing umbrella insurance, most people who fall into this category need it. Obviously, the more money you have, the more of a target you become for lawsuits, and the more you have to protect.Umbrella insurance refers to a liabilityinsurance policy that protects the assets and future income of the policyholder above and beyond the standard limits set on their primary policies.Typically, an umbrella policy is pure liability coverage over and above the coverage afforded by the regular policy, and is sold in increments of one million dollars. The term "umbrella" is used because it covers liability claims from all policies underneath it, such as auto insurance and homeowners insurance policies. For example, if you have an auto insurance policy with liability limits of $500,000 and a homeowners insurance policy with a limit of $300,000, then with a million dollar umbrella, your limits become in effect, $1,500,000 on an auto liability claim and $1,300,000 on a homeowners liability claim.Umbrella insurance provides broad insurance beyond traditional home and auto. It provides additional liability coverage above the limits of your homeowner's, auto, and boat insurance policies.

THE NEED AND PURPOSE OF UMBRELLAS

WHAT IS THE NEED? People can be held legally liable to pay damages for the bodily injury or property damage caused by their negligence. The need for liability can arise as a result of a person's personal or recreational activities as well as a person's business. Some of the higher liability claims arise when insureds are entertaining guests or permitting people to use their property. Consider how a jury's desire to punish a negligent person could result in a judgment for damages in the following situations:

A practical joke misfires and results in a lawsuit for defamation of character.

A neighbor or guest falls on a person's property, resulting in permanent disability.

A protective watchdog proves that his bite is even worse than his bark.

A person's child accidentally breaks an expensive vase while at another person's house.

A moment's inattention while driving results in a multi-car accident.

A spark from burning leaves starts a fire that inadvertently burns a neighbor's roof.

A letter to the editor triggers a libel suit.

At this point, it is important to make a distinction between two terms frequently used in liability suits: coverage and liability. The word coverage refers to the contractual obligation imposed on the insurance company that agrees to indemnify the insured for sums he or she becomes legally responsible to pay as damages. Liability refers to the legal responsibility of the policyholder to other persons arising out of an occurrence. In some cases, a particular peril will not be covered by the policy and the insurance company is under no contractual obligation to indemnify the insured. For example, assume the insurer issued homeowners policy covering an insured's liability arising out of the ownership of a certain property. The insurer is under no obligation to provide coverage under that homeowners policy for an automobile accident that occurred away from the residence premises even if the insured was at fault. In this case, there may be liability on the part of the insured, but there is no coverage provided under the policy. On the other hand, there may be coverage under the policy but no liability on the part of the insured. For example, the Personal Auto Policy provides coverage for property damage up to the policy limits. However, if the insured vehicle is stolen and the thief uses the car to damage several lawns in the area, the insured has no liability for the damage. Even if the insured feels sorry for the neighbors and perceives some moral obligation to repair their lawns, he or she has no legal liability to do so. Likewise, the insurance company has no responsibility, either by way of settlement or as a gift, to make any payment to the neighbors. In this case, while three may be coverage under the policy, but there is no liability on the part of the insured. Insureds should be cautioned to remember that even when there is no apparent liability on the part of the insured or available insurance coverage, the insured may still be sued and found legally responsible. In a civil case, it is possible that the plaintiff, who must establish his or her claim by a preponderance of evidence, may produce evidence that is more credible and convincing than that of the defendant's. And, if the plaintiff's case is more believable, the plaintiff will win.

The settlement the plaintiff receives might be quite substantial because of three factors: $ The public's attitude toward claims; $ The application of the law of negligence; and $ The jury's opinion about damage awards.

PURPOSE OF UMBRELLA POLICIES The Personal Umbrella Liability Policy was created to expand the insured's liability coverage by filling gaps in the basic liability coverage provided by underlying policies and to reduce the insured's worry, trouble and burden of facing personal litigation on his or her own. Personal umbrella liability coverage is usually sold in units of $1 million or more and may be added to a basic homeowners or auto policy that is already written by the insurance company. Many companies also write stand alone, or separate, personal umbrella policies without writing the underlying coverage. To qualify for stand-alone coverage, however, the applicant is usually required to show proof of certain underlying insurance coverage with other insurance companies. Umbrella policies provide insurance for accidents and other situations not ordinarily covered under primary insurance, subject to a deductible of between $250 and $1,000. There is no standard personal umbrella liability policy. The policy's forms, format and coverage vary by insurer. This does not necessarily mean that because one company's policy looks more extensive that it is superior to another policy. Rather, each contract should be reviewed to determine which offers the best coverage for a particular policyholder. Regardless of which company is providing the policy, all personal umbrella policies are designed to give insureds and their families two types of extra liability protection: They add to the liability of any homeowners, automobile or other liability policies currently in force. Most homeowners policies provide a basic personal liability coverage of $100,000; auto policies typically contain a combined single limit of $300,000 per occurrence. An umbrella policy supplements these basic personal liability coverages. If, for example, the insured has a standard auto policy with liability limits of $300,000 and a personal umbrella policy with limits of $1 million, the insured is protected up to $1,300,000, if a covered auto accident occurs and the insured is found legally responsible. $ They are designed to cover liability exposures that other policies do not cover. The personal umbrella policy is designed to cover some of the more unusual exposures, such as personal injury claims, that an insured might face but that are typically not covered under most standard liability policies. A personal umbrella is the liability counterpart of Difference in Conditions (DIC) insurance, a property coverage that expands insurance written on a named perils basis to an open perils basis and protects the insured against risks of direct physical loss to the insured property, subject to certain exclusions and deductibles. An umbrella contract provides (subject to a deductible) liability coverage where no other liability insurance exists, and in addition provides coverage for liability when the limit of the primary or underlying insurance has been exhausted.

SPECIAL CHARACTERISTICS OF UMBRELLA POLICIES

The insurance company that issues the umbrella policy provides additional liability coverage over the primary policies, up to the limits listed on the Declarations page of the umbrella policy, even if the same insurer does not provide the underlying insurance.

The personal umbrella policy covers any number of accidents or occurrences that occur during the policy term, regardless of how many claims are presented. However, the policy restricts payment for any one accident to the limit listed in the policy (usually up to $1 million per occurrence). In other words, even though the insurer may pay for ten claims totaling $10 million during a one-year period, it will not pay more than $1 million for any one occurrence.

To limit the insurer's liability, however, many umbrella policies are beginning to offer aggregate limits, meaning a maximum dollar amount that may be paid during the policy period or during the insured's lifetime, as specified in the policy.

A policy with a $10 million aggregate limit, for example, may pay several claims for $1 million each, but it will only pay out a maximum of $10 million during a given policy period.

It is important to remember that the personal umbrella is a third party liability policy that covers only another person's claim against the insured. It does not cover damage to the insured's own property, motor vehicles, home or other valuables.

TYPES OF UMBRELLA INSURANCE:1. PERSONAL UMBRELLA INSURANCE:

Accidents happen on your property or because of your property, you can be held financially responsible for the consequences. This can happen to anyone. For example, if you were to host a party in your home or apartment and someone was injured on your stairs, then you would suddenly be responsible for their medical bills, emotional damages, and lost wages. How would you pay for it? Personal umbrella liability insurance provides added protection against sudden financial loss in a situation like this. Accidents will happen, and lawsuits can cost millions. Usual insurance policies-such as your automobile insurance and homeowners' insurance-often don't cover the full amount of your assets. So once you've met your policy limits, then you are responsible for any of the remaining settlement. Personal umbrella liability insurance provides higher coverage based on the value of your assets. Coverage limits usually start at $1 million and can go higher depending on your needs and qualifications. To decide if you need personal umbrella liability insurance, you should add up the value of your assets-bank accounts, stocks, bonds, home, available retirement funds, etc.-and compare that dollar amount to the coverage offered under your home and auto insurance policies. If the value of your assets is more than the policy limits, then you may need to consider a personal umbrella liability insurance policy.

2. COMMERCIAL OR BUSINESS UMBRELLA INSURANCE:

If you run a business of any kind-especially one that comes into contact with clients-then you should look into purchasing commercial or business umbrella insurance. This type of insurance is a secondary "excess liability" policy that protects business owners from lawsuits with settlements exceeding their usual insurance policies. Certain businesses are at higher risk of being sued for large amounts-bars, restaurants, sports arenas, large office buildings, and anywhere large amounts of people gather and may potentially be injured or otherwise harmed. Sometimes accidents can happen in your businesses that are not directly your fault, but a court may decide that you are responsible for the financial damages. Your building may have a leak that results in personal injury to an employee or client, or one of your employees may give some bad advice that leads a client to sue. The potential is endless, and as the owner, it makes sense to cover all your bases. Commercial or business umbrella insurance usually covers a variety of situations, including personal injury, contractual liability, liquor law liability, and extension of coverage to other insured parties like employees and business partners. Most umbrella insurance policies start at a $1 million limit and increase from there, depending on your assets and risk. Your umbrella policy limits and terms will vary across different insurance providers, and you should look around to find the policy that best suits the needs of your business. In addition to the added financial protection, commercial or business umbrella insurance provides additional peace of mind. If someone sues you beyond what your traditional insurance policy will cover, you will be able to keep your doors open.

3. OFFICE UMBRELLA POLICY:

Office Umbrella Policy is a comprehensive insurance policy that offers protection to business enterprises against different kinds of risks and contingencies. It is a single insurance policy, which is suitable for large MNC-owned offices, as well as small and medium sized offices such as travel agencies. Professionals including chartered accountants, architects, engineers or any other service provider can also acquire benefit from office umbrella policy. Being a package policy, the office umbrella insurance provides total coverage of all risks that are common to office environment and does away with the need to take different policies. Go through the following lines to know all about office umbrella policy prevalent in India.

UMBRELLA INSURANCE COST:

A common misconception about umbrella insurance is that it costs too much. Of course your rates and terms will depend on your needs and your specific insurance company, but most businesses and many individuals can manage umbrella insurance cost. Typically, most umbrella insurance costs a premium of about $200 to $300 a year. That is very low and generally affordable. But keep in mind that before you can use the umbrella insurance, you will need to meet a deductible-usually $300,000 or more. Careful planning and coordination between your umbrella insurance policy and your traditional liability coverage will take care of this deductible.

UMBRELLA INSURANCE RATES:

Umbrella insurance rates depend on many different factors. In general, people who buy umbrella insurance pay premiums of $200 to $300 a year, and deductibles of $300,000 or more for coverage exceeding $1 million. But these numbers can vary widely. Let's look at some of the factors that go into deciding umbrella insurance rates: Your risk: If you have a risky lifestyle or company, then your umbrella insurance rates will be higher than average. In the context of umbrella insurance, risk is defined as anything that raises your chance of being sued. Owning a sports arena or bar qualifies as a high-risk activity. Your location:Umbrella insurance rates vary across states and cities.

The amount of coverage you need:People who need $1 million in umbrella insurance pay lower rates than those who need $9 million. The amount of coverage you already have:If you already have home and auto insurance liability policies, your rates will be different from someone who wants to use umbrella insurance as a replacement for traditional insurance policies.

The insurance company:

All other variables aside, umbrella insurance rates will be different at each company you consider. Make sure to do your homework and shop around to find the best umbrella insurance rates for your needs. Get quotes from several different companies before signing a contract.

UMBRELLA INSURANCE QUOTE:

When you are looking for an insurance company to provide umbrella coverage for yourself or your business, it's extremely important that you first get an umbrella insurance quote before making any decisions. An umbrella insurance quote is basically an estimate of how much coverage the company will provide for you, including the rate and deductible. This step is vital because every insurance company offers different rates and options at any given time. You can present the same information to five competing insurance companies, and come away with five different umbrella insurance quotes. If you were to perform the same comparison next month, all the numbers would be different, because rates and company variables change constantly. To get an umbrella insurance quote, you will need to give the company some key information about your needs. This usually includes your assets (all types of vehicles, your home, real estate of any kind, retirement funds, etc.), risk factors, current insurance policies, , criminal history, and insurance claim history. The umbrella insurance quote isn't a substitute for a contract. It's more like the price tag. Once you find a company that provides an acceptable quote for your individual umbrella insurance needs, you will need to set up an appointment to sign the official paperwork.

UMBRELLA POLICY CLAIMS:

A personal umbrella policy comes in handy in the event of a lawsuit or liability judgment. For example, imagine someone visits your house and falls and injures herself, or your pet damages your neighbors' property or injures their child. In such cases the umbrella policy claim can be made to cover such judgment if the liability coverage that comes with your home owner's insurance policy does not cover it, or the limits have been reached. Claims can also be made for legal and defense fees.An umbrella policy will also cover liability coverage when you are sued for slander, libel, false arrest, malicious prosecution or other personal liability situations. Most personal umbrella policies do not cover punitive damages, intentional actions or liability incurred in connection with your business activities.

MYTHS ABOUT UMBRELLA POLICY:

Below are some of the common misconceptions contractors have whilst using an Umbrella Company:

It is a myth to think that the personal liability umbrella policy is only for he rich.

It is a myth to think that personal umbrella insurance is extremely expensive.

It is myth to think that insurance is necessary for only the bread winner of the family.

It is myth to think that you would not need flood insurance since you are living in a low risk area.

An Umbrella Company or Composite Company can pay me a minimum salary and dividends, which will earn me more money.

I can just switch Umbrella Company when I breach the 24 month rule continue to claim expenses.

The higher my expenses, the higher my net pay will be.

TATA AIG GENRAL INSURANCE

Tata AIG General Insurance Company Limitedis an Indian general insurance company, and ajoint venturebetween theTata GroupandAmerican International Group(AIG).Tata Group holds 74 per cent stake in the insurance venture with AIG holding the balance 26 percent. Tata AIG General Insurance Company, which started its operations in India on 22 January 2001, provides insurance to individuals and corporates. It offers a range of general insurance products including insurance forautomobile,home, personal accident,travel, energy,marine,propertyandcasualtyas well as several specialized financial lines. The Company's products are available through various channels of distribution likeagents,brokers,banks(through bank assurance tie ups) and direct channels likeTelemarketing,Digital Marketing, worksite etc.

History

Tata AIG General Insurance Company Limited(Tata AIG General) is a businessCollaborationof theTata Groupand American International Group, Inc. (AIG).Tata AIGGeneral merges two major finance organizations i.e. the Tata Group's prominent headship place in India and AIG's global presence as the world's leading international insurance and financial servicesOrganization. This joint venture has started its operations inIndiafrom 22 January 2001. The company provides both corporate and personal insurance services. The organization offers an array of general insurance covers which are well thought-out under commercial and consumer demands. The commercial sector coversEnergy,Marine,Propertyand several specializedfinancialcovers, while the consumer insurance service offers a variety of generalInsuranceproducts such as insurance forAutomobiles, personal accident, casualty, home, health and travel. The company has made the availability for its services from end to end channels of distribution like agents, banks (through banc assurance tie ups), brokers and direct channels like tele-marketing, e-commerce, website, etc. The headquarters of the company is situated in Mumbai. The company has provided the employment to more than 2000 qualified professionals across the country in more than 160 locations.

TATA AIG UMBRELLA POLICY

Covers legal liability of the insured arising out of bodily injury, property damage .Personal injury or advertising injury.Why Tata AIG?TATA AIG brings to you one of the most extensive worldwide network, with presence in more than 130 jurisdictions.

Our form is a duty to defend form which means client will not have to bear the brunt of litigation as under the express terms of the policy we will defend the client in any lawsuit.

Key Features

Duty to defend form Acting like an umbrella it sits over multiple primary policies, in addition to providing broader coverage it provides excess limits when the limits of underlying liability policies are exhausted by the payment of claims Umbrella comes with a drop-down feature, narrowing coverage gaps

Key Exclusions War Asbestos exposure Any obligation of the Policyholder under Workers Compensation Law

CASE STUDY ON UMBRELLA INSURANCE OF TATA AIG

What Exactly the Umbrella policy?

Umbrella insurance refers to the liability insurance that is in excess of specified other policies and also potentially primary insurance for losses not covered by other policies

Why would anyone need an Umbrella policy?

There are many situations where a standard liability policy is simply not enough coverage. Anumbrella policy allows you to protect yourself against major lawsuits in two ways. First, the umbrellaprovides excess liability over underlying coverage. Second, the umbrella provides liability coveragethat may be excluded by homeowners or auto policies.

What Special protection is given by umbrella policy? Personal injury losses that may be limited or excluded under most homeowners policies will receivebroader coverage under an umbrella policy. As a rule, personal injury does not have a uniform definition; however, just about all umbrellas will refer to personal injury to include bodily injury.

MostPolicies also include in their definition of personal injury:Mental anguish, false arrests, wrongful eviction, wrongful detention, malicious prosecution, invasion ofPrivacy, assault and battery, slander, libel and defamation of character.

How the policy work? Generally, an umbrella policy pays all of the covered loss that exceeds the limits of the base orunderlying policy.If, for example, the basic policy paid $200,000 on a slip and fall injury and the claim was for $250,000,the umbrella would cover the $50,000 over the basic policy's $200,000 limit.

What does Umbrella insurance covers? Umbrella insurance provides coverage for injuries, damage to property, certain lawsuits, and other personal liability situations listed below. Umbrella Insurance insures you above and beyond the limits of those policies and, in addition, it covers some situations that aren't covered by the other types of policies you have.

CONCLUSION I conclude this project study by saying that Umbrella Insurance is very important & should have more market & value in India as compared with international insurance market.

The combination of many items together makes the policyholder easer & profitable.

Policies like this should be there in India on large basic that will help the citizens.

Now, before coming to the conclusion that, despite all the warnings and all the concerns, you probably don't need umbrella coverage, think about some of the consequences of not getting it.

The time is coming, if it hasnt happened already, where an insured is sued for injuries or property damage not covered by either his primary policies or his umbrella that would have been covered by another umbrella.

As a result, the insured sues his broker for damages caused by a professional error in not recommending the umbrella policy that would have covered this lawsuit, and a jury agrees. .