Insurance is the ability to transfer the risk of loss which arises due to death, sickness, accidents, damage to property and many more.
Life is uncertain at times, one needs to be financially prepared to face. Having a insurance will secure an individual's financial health as it will take care of the expenses occurred.
Insurance can be brought on anything which has economic value be it a car, two wheeler, or a house.
Insurance plans have become crucial as they not only protect, but also provide tax saving avenues for you.
There are different types of insurance services provided by companies.
Car insurance in India is a must. There is no escaping this one, like you can for health or life insurance. These days it has become much easier with many online insurance companies providing car insurance online.
Make sure that you compare policies online to get the best deal. To simply renew an existing policy with your existing provider could cause a loss. Also check for IDV and add on's like accident insurance cover.
Term Life Insurance
Term life insurance is a must and many individuals confuse this with endowment policy. Term Insurance is very much different in the sense that you do not get your money back, but your coverage is very high.
The very objective of insurance is to offer a high coverage. It is not an investment. Always go in for a term insurance and only later consider an endowment plan.
Money Back Insurance
Money back insurance could be an option once you have taken a term life insurance. It is much better than placing money in say a recurring deposit of a bank, because you additionally get life cover.
In case you survive the returns may not be as high as other investment instruments.
With the rising costs of education, child plans help to meet the educational expenses of a child. The best part of a child plan is that insurer is the premium waiver in the case of death of the policy holder.
This means that the education needs of the child continues to be met despite all odds. The premium paid qualifies for tax rebate under Sec 80D, while the income is also free from tax under Sec 10 (10D).
A critical illness in the family can be a severe drain on your financial resources. There are many companies that today provide critical illness cover along with the policy.
You can opt for it along with your health insurance. The premium deferred can differ depending on the illness and the sum that needs to be covered. It is important to stick to one provider after you have taken the cover.
Travel insurance covers a host of areas including passport loss, medical emergency, baggage loss, etc. You are normally covered from the day your trip begins to the day it ends.
Travel insurance has become very popular these days and individuals have many options to purchase the same online. Remember to study the terms of the policy carefully before you opt for one.
Health Insurance policy will provide you some financial respite in case there is a health condition that needs to be addressed. With a rise in medical cost and increase in life threatening diseases health insurance has become mandatory.
One needs to buy health cover even if it is provided by your employer as the amount will not sufficient in case of need.
Life is uncertain, accidents and medical emergency can happen at anytime. So, it is better to be covered with good health policy which suits your requirement.
Tax benefits under section 80D are also available on health insurance. Senior citizens can claim Rs. 20,000 and others can claim Rs. 15,000 tax benefits.
Endowment policy are traditional insurance plans where the sum assured is got back if the individual still survives during the end of the policy.
Endowment plans are combination of savings and insurance.
They can serve better if they are considered for long term investments. Individuals who are not looking for higher returns but are interested in guaranteed returns towards end of the policy can opt for these.
Two wheeler insurance
Two wheeler insurance is compulsory in India. It provides insurance to you and the third party in case of physical damage, theft and accident.
Also, one can repair the vehicle at the garage and avail cashless facility if the garage has tie up with your insurer.
Usually, policies also covers your two-wheeler against burglary and damage caused due to fire, riot, flood and terrorism.
However, normal wear and tear and general aging of the vehicle are not covered under the policy.
One can reap the benefits of old age if they have properly planned their retirement by choosing best pension plans which suits their requirement.
One can start planning for retirement by starting with small amounts and increasing the same with age to collect good corpus at the time of retirement.
On pension plans, tax benefits are available under 80CCC and the maximum limit is Rs. 1.5 lakh.
However, there are various plans available to an individual.
To make a best decision one needs to compare the features, premium and cost associated with the products.
Personal Accident Insurance
Personal Accident Insurance covers losses in the event of death or disability directly due to accident. It also covers temporary and permanent disablements.
So, any injury due to any illness or disease is not covered by the policy. It has to be purely due to an accident.