Blog 73: Introduction to Non Life Products by Xavier Lo, FIA, FRM, MBA

Thanks to one of my readers for giving me the idea for this week’s topic! Hopefully this will give some of you guys an easy introduction into the world of Non-Life Products [非人壽保險]. Of course, there are infinitely many non-life products in the world. Afterall, you could even insure a professional football player’s leg.

Non-Life insurance is also commonly known as Property and Casualty in the US. This gives us a good split of the two main products. To start with, property damage [財產損失] is what it reads like – it is to do with damaging property. In the world of insurance, property can be anything that you define it to be, maybe your car, someone else’s car, their house, or even your own private jet [私人飛機]. Most commonly, you buy property damage insurance to protect damage to your own items or to prevent damage that you’ve caused to other people’s things. Like when you drive your boat and hit someone else’s boathouse [船屋].

Casualty insurance is usually when you injure [傷害] or accidentally kill [唔小心殺] someone else. Lets say you were driving your car and you hit someone on the road. That’s casualty insurance. How about when you own a coffee house and you forget to mop the floor, and a customer slips [客人跌親] and hurts their back? That’s also casualty insurance, as you’re responsible for the customer’s injury which could have been prevented if you cleaned properly! If you’re a construction worker and accidently hit your colleague with your hammer at work? Casualty insurance! Quite easy right?

Of course, you can have products which have both Property and Casualty, like travel insurance for your suitcase, and also your own life. There are other more complex products relating to financial lines (when someone goes bankrupt) or business interruption (I’ve covered that before). But start with the basic P&C insurance products first. That’s enough to explore for a long time!