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5 Must-have Insurance Policies

dateKnowledge Centre Team dateApril 19, 2021 views421 Views
5 Must-have Insurance Policies

Life has always been uncertain, and it is impossible for the human being to assert what the next moment holds in reserve for them. This uncertainty regarding the future is the sole reason why countless people opt for distinct types of life insurance policies every year. The principal aim of an insurance policy is to guard things and people that hold utmost importance in your life.

In the present times, people can receive multiple insurance policies like health insurance, car insurance, life insurance, etc. The coverage rendered for these insurance policies will always assist you in ensuring a secured future along with safeguarding your earnings and assets.

Benefits of Insurance Policies

Insurance is a venture management mechanism that not only serves the people and companies but also profits the community and nation's economy in diverse ways. Mentioned below are some of the significant advantages of insurance policies.

  • Bestows tranquility of mind

    Insurance policies protect individuals against numerous contingencies that can put them or their families in a monetary crisis. By capping the intricacies of human business and life and businesses, insurance renders a feeling of safety, providing you with financial stability.

  • Encourages financial growth

    The funds collected by insurance are invested in diverse projects like power, roads, water supply, etc., assisting in the overall financial growth of our country. Apart from this, insurance policies also contribute to economic growth by receiving FDI and investing funds in capital markets.

  • Develop savings habit and render tax advantages

    Many life insurance products arrive with investment cum security advantage, and these products are responsible for inculcating a consistent saving practice among people. Apart from this, insurance policies also render various tax benefits under section 80C and 80D of the Income Tax Act, 1961.

5 Must-have Insurance Policies

Insurance policies refer to the policies that enable its claimants to avail coverage for a specific time or a set term of years. Comprehending the significance of insurance policies is the urgency of the hour, and it has become very important for every individual to hold an insurance policy. While the insurance policy requirements differ from person to person.

Mentioned below are the 5 must-have insurance policies for all individuals in modern times.

1. Life Insurance

A life insurance policy is a must-have term life insurance for individuals who are the sole bread earner of their family or who hold a large number of dependants and financial liabilities. Under life insurance, the amount secured or the coverage sum will be given out to the nominee or dependent on the person insured in case of the untimely demise of the policyholder.

Life insurance is a significant requirement to warrant the financial and economic well-being of your family, and the coverage sum selected must be competent to render comprehensive financial security. As life insurance products are rendered by various financial institutions, it is essential to choose the one that renders adequate coverage.

iSelect Star term life insurance plan and Invest 4G plan provided by Canara HSBC Oriental Bank Of Commerce Life Insurance is amongst the topmost life insurance plans that you can trust upon for safeguarding the future of your loved ones. These life insurance plans provide absolute protection to the insured person till the age of 99 years, along with an option of paying the premium in affordable monthly, quarterly, or yearly instalments.

2. Health Insurance

Health risks are an unavoidable element of any individual's life. Holding in mind the skyrocketing price of healthcare and an increasing number of ailments, it's essential to hold the financial buffer to guard yourself against health emergencies. Therefore, health insurance policies are again a must-have to remain protected against financial pressure during medical contingencies.

Health insurance policies come in various kinds and comprise personal health insurance, family health insurance, senior citizen health insurance, and severe ailment health insurance.

While selecting a health insurance policy for your family, you must always keep in mind that getting this policy at an early age can be more beneficial, and you must also consider the amount of sum covered so that you do not face any difficulty during pressing times.

Health first plan from Canara HSBC Oriental Bank of Commerce Life Insurance is the most celebrated health insurance plan in the country. This plan holds the provision to cover your life from the gravest illness along with rendering high coverage with the most economical premiums.

3. Car Insurance

Car insurance policies are the compulsory legal obligation in India for each car owner under the Motor Vehicle Act, 1988. To protect oneself from any claims during a motor accident, the government has made it mandatory for car and commercial vehicle owners to hold a third-party liability motor insurance.

These car insurance policies arrive in a comprehensive package where your vehicle is insured against the multiple ventures of injury or accident along with the accidental bodily cover to the car owner. Considering the increasing road accidents and the cost of your valuable car, this policy has again become a must-have for every individual.

4. Home Insurance

A house is one of the most valuable and precious possessions that hold many priceless memories and belongings of a person. Hence, every person wants to completely protect their home against numerous risks like theft, losses due to natural catastrophes, etc., that you may not be capable of alleviating effectively.

Due to all these reasons, many people today avail home insurance. These home insurance policies safeguard you and your family against all the plausible threats that may arise anytime. One can easily receive home insurance from a reputable financial institution like Canara HSBC Oriental Bank of Commerce Life Insurance to ensure that their precious and beloved home is covered completely.

5. Disability Insurance

Accidents are unforeseen and unavoidable, and sometimes these accidents can occur in inabilities that can additionally hold a tremendous influence on your earning capability. Hence, to save yourself and your family from the financial burden that might arise during these times; you must invest in disability insurance.

This disability insurance policy presents monetary compensation in the ill-fated event when a person becomes disabled due to a mishap and cannot work either for an elongated period or permanently. This insurance policy includes temporary, permanent, partial, and complete disability, and the coverage amount varies accordingly.

Insurance policies work as a shield to protect you and your valuable possessions against numerous uncertainties in life. Hence, it has become very important for every individual to invest in an insurance policy. However, you must always assess your needs before choosing the best term plans in INDIA to ensure that it completely secures you and your family from any unforeseen events.

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Frequently Asked Questions (FAQs) for Life Insurance

The premium is one of the most important factors to consider before buying a policy. Many people buy a life insurance policy with a high sum assured but are unable to process the premiums for the entire premium payment tenure. You can get a better idea of the premium outgo with the premium calculator available in the 'Tools and Calculator' section of www.canarahsbclife.com.

Life insurance plans come with several riders which increase the efficiency of the policy for the buyer. For instance, if you have a history of terminal illness in your family it would be advisable to opt for terminal illness rider with your term insurance. Riders or add-ons help in customising the standard policy benefits for the requirement of different families. The iSelect term insurance plan comes with a built-in cover for terminal illness, and option for protection against accidental death or disability. You can also opt to cover your spouse's life under the same policy by paying an additional premium.

Insurance companies calculate the premiums based on several factors such as age, gender and occupation.

Age:It is one of the biggest factors that influence life insurance premiums. Premiums tend to be low when the life insured is younger as the chances of contracting diseases is low. Young people also opt for policies with longer tenures and pay premiums for a longer duration, which makes the policy cheaper for young people.

Gender:The insurance premium for women is generally lower when it comes to life insurance plans. Women live longer and pose a lesser risk of a claim leading to lower premiums for them.

Lifestyle habits:The premiums for people who smoke or drink is always higher due to higher health risks.

Policy term:Policy terms are also taken into consideration by insurers while deciding the premium amount. Policies with longer tenure are cheaper as compared to short-duration policies.

Mode of purchase: The platform that you use to buy the policy also determines how much you will have to pay for the plan. People who buy life insurance policies online have to pay lower premiums as compared to offline policies.

Occupation:The nature of your work is an important factor that influences the premium amount. Certain occupations like shipping and mining are considered more dangerous as compared to jobs in services industries. The insurance premium rises with the risk profile.

Processing life insurance claim is a transparent and smooth process with Canara HSBC Oriental Bank of Commerce Life Insurance.

In case of the death of the life insured, the nominee will have to intimate the company by filling a Death Claim Form and sending it to the nearest branch office.

Once the form is received, the claim is registered by the insurer.

After the registration of the claim, the company will send the claims pack along with the related forms such as physicianâ s statement form and employer certificate that need to be filled.

Along with the duly filled forms a few documents such as original [policy document, death certificate, copy of bank passbook, hospital or treatment records, photo identification and address proof have to be provided.

The claim is processed on the submission of relevant documents. Once the documents are verified, the claim amount is released post all due diligence.

Household expenses rise with age. The cost of children's education increases along with other lifestyle expenses. The iSelect term plan offers an option to increase the cover according to the life stage. If opted, the insurance cover increases by 25% at every 5-year terminal till the 20th policy year.

Even though a life insurance policy is bought to protect your family in your absence. There are chances of the claim being rejected due to several factors.

False information: If the policyholder provides false information or conceals important information while buying the policy, the insurer has the right to reject the claim after his/her death.

Type of death: Deaths due to suicide in first policy year, intoxication or pre-existing disease is not covered under life insurance.

Premium payment: The payment of premiums on time is of utmost important to avail the benefits of life insurance. Life insurance policy may lapse on the failure to pay the premiums

Nominee details: An insurance company can put the claim on hold if the nominee details have not been filled or not been updated by the policyholder.

Suicide: If the life insured commits suicide within 12 months of buying the policy, the insurance companies generally pay 80% of the total premiums paid.

Buying life insurance online is not only safe but a better option. Online life insurance policies have lower premiums and the individual is not required to visit the insurer's branch or a bank. Online insurance policies also offer higher benefits. Customers should, however, buy online policies only from credible insurers and should check for SSL certificate on the website to ensure that the website is legitimate.

The cost of life insurance policies varies depending on factors like age, gender and occupation. The average cost of life insurance plans, especially term plans, is very low compared to the amount of coverage offered.

An individual is allowed to have multiple life insurance policies. People opt for more than one policy to increase the cover or avoid claim rejection. In case of multiple policies, even if the claim is rejected by one insurer, the beneficiaries may receive the benefit from a different insurer.

Life insurance policies are of different types. In the case of unit-linked or endowment policies the policyholder receives the maturity benefit at the end of the policy term. However, in the case of term insurance plans, there are no maturity benefits. The death benefit is only paid out after the death of the life insured.

When you buy life insurance, the insurance company asks for the nominee details. Only the person named as the nominee in the policy can cash out a life insurance policy in case of death of life insured.

A life insurance policy is generally taken for a specified period. After the policy duration of a term plan gets over, the policy simply terminates and ceases to exist. However, in the case of unit-linked plans or endowment, you can use the policy as a tool for retirement planning and the accumulated corpus is used by the insurer to pay you monthly amounts for your entire life.

If a policyholder purchases a term plan for 25 years and dies during the policy term. The family receives the death benefit. In the case of iSelect term plan, the policy provides four payment options to the beneficiaries. If the regular payment options are chosen the policy works as a source of regular income.

It is a popular misconception that life insurance is only for accidental deaths. A term life insurance plan like iSelect also covers terminal disease along with death. A terminal illness cover is important as health insurance pays only for the cost of treatment and hospitalization, but a terminal illness cover pays you a lump-sum amount which takes care of other expenses. On the other hand, unit-linked policies such as Invest 4G cover death and also provide decent returns for other financial goals such as buying a house of child's education.

It is ideal to buy life insurance in your early 20s because it’s is the time when people have just started with their professional life and so there are lesser responsibilities and financial liabilities to take care of. Also, if you buy life insurance at this age, you will be paying relatively lower insurance premiums since it’s a due fact that mortality rate in case of young people is low. And that is why insurance companies offer lesser premium rates to younger people as they think that they are most likely to be fit and healthier with less chances of filing a claim in future.

Once you have cancelled your life insurance policy, you will instantly lose your life insurance cover. Afterwards, your insurance company will get in touch with you and ask for valid reasons regarding the cancellation of your policy. In case you cancel your life insurance policy within the grace period, i.e. 15 to 30 days, depending on your insurer, then insurance company will reimburse the premium amount paid by you. But, no refunds will be paid to you if the policy is cancelled after the grace period.

Yes, you can take life insurance under Married Women’s Property (MWP) Act, 1984 only if you are a married man and a resident of India. Buying a life insurance plan under MWP Act would be helpful in saving your family’s financial well-being when you are not around. As per this policy, only wife and children would be eligible to receive the death benefits. You can also buy a policy if you are a widower or a divorcee. However, in that case, you can give your child’s name as your beneficiary. It is very simple to buy a life plan under MWP Act. All you need to do is to fill up an MWP addendum while purchasing an insurance policy.

Yes, there are different payment options for you to pay premiums. Here’re some of them

    1. Regular premium payment option – This premium payment option allows you to pay premiums equal to your policy term either monthly, quarterly, half yearly or annually.

    2. Single payment option – Through this premium payment option, you can pay the lump-sum amount in one single payment.

    3. Limited payment option -In this premium payment option, you can pay premiums for a specific period of time less than policy term either monthly, quarterly, half yearly or annually, but benefits of insurance can be enjoyed for a longer period of time.

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