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  • What is Life Insurance?

    What is Life Insurance?

    Life Insurance is a contract between an insurance policy holder and an insurance company. As per the contract, the insurance company promises to pay the beneficiary a sum of money in exchange for a premium, upon the death of an insured person or the policy holder. Depending on the type of insurance, other events such as terminal illness or critical illness can also trigger payment. The policy holder typically pays a premium, either regularly or as one lump sum.

    Insurance is also seen as a tool to plan effectively for your future, your retirement and for your children's higher education needs.

  • How does a Life Insurance plan help?

    How does a Life Insurance plan help?

    Life Insurance can help you in the following ways:

    • It helps in securing the family's financial future in case of the breadwinner’s/insured person’s premature death. The family of the insured individual gets a death benefit, an amount that can be used to take care of expenses and maintain their standard of living.
    • It provides you with a corpus that lets you plan your retirement financially.
    • It allows you to leave a legacy by creating additional wealth for your family.
    • Certain policies also allow you to pay for medical expenses in case of chronic or terminal illnesses
    • It allows partial withdrawal of funds in case of emergency or milestones such as the marriage of your child, purchase of a new home, etc.

  • Why do I need Life Insurance?

    Why do I need Life Insurance?

    You need life insurance:

    • To help replace earnings that would have ceased at the death of the insured.
    • To avail of tax benefits.
    • To help pay for milestone events in your life.
    • To help plan for your child’s education
    • To plan for your retirement

  • What are the benefits of having a Life Insurance plan?

    What are the benefits of having a Life Insurance plan?

    Life Insurance helps you secure you and your family’s future. Here are some of the benefits:

    • Provides Life Cover – In a world of uncertainties, life insurance provides financial security to your family even in your absence. It allows them to continue with the same lifestyle that you would have provided them.
    • Life Stage Planning – You can fulfil your goals and financial milestones like child’s education and marriage. Plan for your retirement and leave a legacy for the next generation
    • Long-term Savings –Life insurance is a vehicle of long – term investment that can help fulfil your financial goals and future needs.

  • How does Life Insurance work?

    How does Life Insurance work?

    The first step is to buy a policy and consequently, pay the monthly or annual premium on time. In the unfortunate event of your death, the insurance company pays a pre-decided amount to your family or whoever you named as the beneficiary. The moment the life insurance policy is issued, an asset to the tune of sum assured is created. Unlike other forms of investments, insurance is the only form of investment that gives you the amount promised at the time of signing the contract.

  • How do I determine how much Life Insurance I need?

    How do I determine how much Life Insurance I need?

    The insurance needs vary for every individual. It’s a personal requirement, hence, before deciding the amount, you need to consider your life goals and the ongoing inflation rate. A concept called ‘Human Life Value’ gives a fair estimate of how much life insurance is good to have. It is calculated as the amount, which if invested in a fixed deposit, would generate an income equal to your current income. The thumb rule is 10 – 12 times your current annual income is your Human Life Value. So, what you need to do is to be clear about your current financial situations, your future aspirations, current liabilities and the risks that you want to mitigate in your life to decide on the insurance cover you need.

  • Is Life Insurance an investment?

    Is Life Insurance an investment?

    Yes. Life insurance is a type of investment tool to fulfil various financial milestones. It instils a habit of disciplined savings, thereby helping you build a corpus for future financial security. It can help you achieve various financial goals like paying for your children’s education, buying a house, retirement and more.

  • Should Life Insurance be a part of my investment portfolio?

    Should Life Insurance be a part of my investment portfolio?

    Yes. A diversified portfolio helps you mitigate risk of investments. Apart from investing in various financial instruments, investing in life insurance is important from perspectives like financial security, fulfilling financial goals and tax planning.

  • What are the different categories of insurance available in the market?

    What are the different categories of insurance available in the market?

    There are primarily three categories of insurance – life insurance, health insurance and general insurance. General Insurance (non–life) includes everything that isn’t related to life insurance, such as motor insurance and liability insurance. Health insurance plans pay for medical and surgical expenses incurred by the insured.

  • What are the different types of Life Insurance plans available?

    What are the different types of Life Insurance plans available?

    Following are the different types of life insurance plans:

    • Term plans – the most basic form of life insurance that promises to pay a beneficiary a certain amount in case of untimely death of the insured, but nothing in case the insured survives the term of the plan.
    • Endowment plans –not only provides death benefit but also provides maturity benefit
    • Whole life plans – the insured is covered for his entire life and the benefit is paid on death, whenever it occurs.
    • Annuity plans – retirement plans that provide annuity upon retirement.

  • What are Term Insurance Plans?

    What are Term Insurance Plans?

    Term insurance plans are simple and affordable; and offer pure life insurance coverage. An insurance company promises to pay the beneficiary a pre – decided lump sum amount in case of premature death of the insured. However, if the life insured survives the policy term, nothing is payable. In other words, there is no survival or savings benefit under term plan. Term insurance is a viable option for those who are looking forward for a large sum assured and low premiums.

  • What are the different types of Term Insurance plans?

    What are the different types of Term Insurance plans?

    There are four different types of term insurance plans:

    • Pure Term Plan - The nominee receives the claim amount if the death of the policyholder occurs during the term of the plan. However, in case of maturity, nothing is payable to the life insured.
    • Term with Return of Premiums Plan - The premiums are refunded to the policyholder in case of maturity of the plan. However, the nominee is paid the sum assured in case of death of the policyholder during the policy term.
    • Increasing Term Plan - Under this plan, the sum assured increases every year at a pre - decided percentage. The premiums would increase either based on inflation or life stage (i.e. on marriage, on birth of first child etc.).
    • Decreasing Term Plan - The sum assured under this plan decreases every year at a pre - decided percentage. These plans are generally good for loan covers.

  • What are Endowment Plans?

    What are Endowment Plans?

    An endowment plan is a life insurance contract designed to pay a lump sum after a specific term - either on its maturity or on the premature death of the policy holder. A variant of Endowment Plan is the ‘Anticipated Endowment Plan,’ popularly known as Money Back Plan. Here, periodic payments are made to the policyholder over the policy term. The balance sum assured is paid on maturity.

  • What are Whole Life Plans?

    What are Whole Life Plans?

    Whole Life Insurance Plan guarantees to remain in force for the entire lifetime of the policy holder, provided premiums are paid regularly as per the contract of the policy. The death benefit is payable only on death, whenever it happens. A Whole Life Plan may be either a limited premium paying plan or regular premium paying plan.

  • What are Annuity Plans?

    What are Annuity Plans?

    Annuity plans, popularly known as retirement or pension plans, provide you with financial security during your old age. Given the high cost of living, rising inflation and rising cost of health care, you can continue to live with pride and maintain a standard of living with income from your annuity/retirement plan.

  • What are the different type of Annuity Plans?

    What are the different type of Annuity Plans?

    There are two types of annuity plans:

    • Deferred Annuity Plan – in which one keeps investing to accumulate a corpus for retirement. This phase is also known as accumulation phase.
    • Immediate Annuity Plan – the corpus accumulated in the accumulation phase is then invested in an Immediate Annuity Plan. It provides annuity or pension to the policyholder. The annuity would continue till the policyholder survives. Some pension plan offers annuity for the spouse as well.

  • What is a ULIP?

    What is a ULIP?

    ULIP stands for Unit Linked Insurance Plan which provides risk cover for the policy holder as well as investment options to invest in various funds available with the insurance company. A part of premium paid is charged towards providing life cover. The balance amount, also known as investible portion, is then invested in various funds of the policyholder’s choice based on his / her risk appetite. The funds in ULIP are a combination of various debt and equity instruments.

  • What is a bonus?

    What is a bonus?

    A bonus is an addition made to a policy that is paid out of profits made by an insurance company. Bonuses are paid only to a participating (or with–profits) policies. The bonus could be either a reversionary bonus (simple or compound) or a terminal bonus.

  • What are the different types of ULIP?

    What are the different types of ULIP?

    There are two types of ULIPs:

    • Type I ULIP – The death benefit payable is either the sum assured or the fund value, whichever is higher.
    • Type II ULIP – The death benefit payable is sum assured plus fund value.

  • How to make a Life Insurance claim?

    How to make a Life Insurance claim?

    In case of death of the life assured under the plan, the nominee/ beneficiary/ assignee has to submit the claim documents to the insurance company as soon as possible to get benefits of the insurance policy. To know the complete process, click here

  • What is Joint Life Insurance?

    What is Joint Life Insurance?

    Joint life policies are designed to cover couples or partners. In the event of either’s death, the surviving person would be paid the sum assured. The plan has multiple benefits and offers security in either’s absence. This could be an endowment or a term plan.

  • What is Health Insurance?

    What is Health Insurance?

    Health insurance is a type of insurance policy that provides for payment of expenses incurred on medical and surgical procedures. It can be either a reimbursement of expenses for an illness or injury or could be a lump sum compensation for any illness e.g. cancer. The cost of health insurance is deductible to the payer and benefits received are tax-free.

  • How does Health Insurance help?

    How does Health Insurance help?

    Health insurance plans help you recover expenses incurred on treatment and secure you and your family in terms of both health and money. It disburses the payment towards actual medical expenses of illness or surgery. This makes health insurance extremely critical for a family’s financial wellbeing.

  • What is Group Insurance?

    What is Group Insurance?

    Group insurance is a type of insurance wherein a group of individuals are covered by a single insurance policy. It is generally purchased by an employer for the benefit of the employees. However, other groups, for example, members of a club can also be covered under group insurance. A master policy is issued in the name of the Master Policyholder. The group would always remain dynamic as members move in and move out of the group.

  • Why do I need to do tax planning?

    Why do I need to do tax planning?

    Tax planning generates savings as it helps you minimise the amount of tax payable for the year. By planning your tax liabilities, you can enjoy benefits of investment growth and financially secure your future.

  • How does life insurance help in tax planning?

    How does life insurance help in tax planning?

    Though there are multiple modes for saving tax, life insurance is one of the most effective tax planning tools. With life insurance plans an individual can not only save tax but also look at achieving their long term goals.

  • What tax benefits can I avail through Life Insurance?

    What tax benefits can I avail through Life Insurance?

    The tax benefits that you can avail are:

    • Under Section 80C and 10(10D) of the Income tax Act 1961.
    • Premiums paid up to Rs. 1,50,000 are deductible as per provisions of Section 80C.
    • The proceeds from a life insurance policy are exempt under Section 10(10D) of the Income Tax Act, 1961. This benefit is subject to terms and conditions of the act.

  • Are there any Life Insurance plans for children?

    Are there any Life Insurance plans for children?

    Yes, there are two kinds of life insurance plans for children- traditional plans and ULIP. Either the parent or child can be the life insured.

    • In a plan with the child as the life insured, the premium is paid by the parent. There could be a waiver of premium benefit on the life of the parent, depending on the features of the policy. The plan would vest in the child’s name once the child becomes an adult, i.e. 18 years of age.
    • In a plan with the parent as the life insured, the parent is both the life insured and the premium payer. These plans offer a sum assured on death of the parent with all future benefits remaining intact. This plan may offer a waiver of premium benefit on the death of the insured parent, depending on the features of the policy.

  • What are the benefits of Life Insurance plans for children?

    What are the benefits of Life Insurance plans for children?

    Child insurance plans are investment plans that primarily offer the following benefits:

    • Securing your child’s financial future
    • Arranging funds for the child’s higher education and/or marriage

  • Are there specific Life Insurance plans for women?

    Are there specific Life Insurance plans for women?

    Yes, there are specific insurance plans designed for women. These plans assist them in saving and also help them secure their dependent’s future. Women insurance plans focus on 3 types of women:

    • Working women
    • Women who make income through interests, rents, dividends etc.
    • Home makers and widows

  • Are there specific plans for Senior Citizens?

    Are there specific plans for Senior Citizens?

    Yes, some insurance plans offer coverage up to 75 or 80 years. However, for senior citizens, more important than insurance coverage is a need to have a secured retired life. For that purpose, annuity or pension plans provide a lifetime income.

  • Is online purchase of Life Insurance safe?

    Is online purchase of Life Insurance safe?

    Yes. Buying life insurance online is safe, convenient and quick. Any insurance transaction online is safe if the website has a secured connection. This can be checked by noticing whether the website has https:// before its name in the address bar.

  • What is Bancassurance?

    What is Bancassurance?

    Bancassurance is the selling of insurance policies by a bank to its own customers. Banks sell the insurance policies in affiliation or partnership with an insurance company.