General insurance, also known as non-life insurance, refers to a type of insurance that offers financial protection related to assets or legal liabilities, without involving life coverage.
General insurance is a type of insurance that provides protection against risks unrelated to human life, such as vehicle damage, property loss, or medical expenses due to accidents.
This product offers a financial solution that helps reduce the impact of losses from unexpected events.
To better understand general insurance—including its definition, types, and how it works—read the full explanation below!
General insurance, or non-life insurance, refers to a type of insurance that offers financial protection for assets or legal liabilities, but does not involve life coverage.
Unlike life insurance, which provides death benefits to beneficiaries upon the policyholder’s passing, general insurance focuses on protecting assets and covering unexpected expenses during the policy period.
It includes a wide range of coverage such as motor insurance, property insurance, travel insurance, health insurance, and personal accident insurance. Typically, general insurance provides short-term coverage—often one year—and must be renewed periodically to remain active.
There are various types of general insurance available to suit your needs and the risks you want to cover. Here are some of the most common:
Motor insurance protects against the risk of vehicle damage or loss, whether it's a car or motorcycle. Coverage includes various risks such as accidents, theft, or natural disasters.
Common types of motor insurance in Indonesia include:
Property insurance protects homes, buildings, or other real estate assets from risks such as fire, natural disasters, theft, or accidental damage.
This type of insurance covers physical assets without involving life protection. Some examples include:
Fire Insurance: Covers damage from fires.
Earthquake Insurance: Protects against the risk and impact of earthquakes.
Commercial Property Insurance: Designed for businesses to protect operational assets.
This type of general insurance offers financial protection against medical expenses from illness or accidents.
It falls under general insurance because the benefits apply while the insured is alive and aim to cover healthcare costs—not to provide an inheritance like life insurance. Coverage may include dental care, maternity, and specialist treatment.
Travel insurance provides protection during domestic or international trips. Benefits include:
Coverage for trip cancellation or delays
Lost baggage
Emergency medical costs abroad
Accidents during travel
Personal accident insurance offers financial support if the insured suffers injury, permanent disability, or death due to an accident.
Even though it may include death benefits, this insurance is still categorized as general insurance because the focus is on physical injury risks, not comprehensive life protection.
Benefits can include:
Compensation for permanent disability due to accidents
Death benefits for beneficiaries in case of fatal accidents
Medical and treatment expenses following an accident
Having general insurance provides various advantages that protect your finances and assets from unexpected risks, such as:
Reducing financial losses from incidents like accidents, fires, or theft
Covering the cost of repairing or replacing damaged or lost assets
Offering peace of mind, knowing you are protected against specific risks
Helping you recover financially after a loss (e.g., car crash or natural disaster)
Supporting businesses in minimizing losses from asset damage or operational disruption
Providing liability protection, such as in third-party insurance cases
Meeting legal requirements, like mandatory vehicle or construction insurance
General insurance operates based on the principle of risk protection. The policyholder pays a premium to the insurance company, and in return, the company covers any losses based on the policy terms.
Here's how it works step by step:
The policyholder chooses the type of insurance (e.g., motor, property, health), which outlines coverage, exclusions, and benefits.
Premiums are paid regularly—monthly or annually—based on the risk level, asset value, and other factors.
When a covered event occurs (e.g., accident), the policyholder files a claim.
The insurer verifies the claim, including document checks and investigations if needed.
If approved, the insurer provides compensation—this may include repairs, replacements, or monetary reimbursement.
In general, insurance is divided into two main categories: general insurance and life insurance. While both offer protection, they differ in several ways:
General insurance covers risks related to assets or legal liability—such as vehicles, properties, health, and travel.
Life insurance focuses on providing financial support to beneficiaries if the insured dies or becomes permanently disabled.
General insurance typically has a shorter term (e.g., 1 year) and requires regular renewal.
Life insurance offers long-term coverage, often for life, or a specific term like 10, 15, or 20 years.
In general insurance, benefits are based on asset value or repair costs.
In life insurance, a fixed sum assured is provided to beneficiaries, agreed upon at the start.
General insurance benefits go toward repair costs, asset replacement, or medical bills, typically benefiting the policyholder.
Life insurance benefits go to the insured's family or named beneficiaries as a death benefit or financial support.
General insurance plays a vital role in safeguarding your finances from various risks that can strike at any time. One of the most vulnerable assets is your motor vehicle.
That’s why car insurance is essential. It helps cover repair costs, theft losses, and even legal liability to third parties.
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