Be Smart and get Insurance because it is the only thing can save your spouse in an odd time when you are not with them anymore. If you are the only bread earner of your home and source of monthly income for the Home than the Safety and Health of yours become paramount for your family. So, it becomes critical for you and here in this blog, I will discuss Five Insurances you must-have in your basket. 

                    Any other type is totally avoidable but these five are not. So, Let’s Start with the Topic…….

Insurance and its types

Life insurance 

            It is the simplest and basic but Important Insurance which will protect you against loss of life. It does no matter if you are having dependents on you are not, but you must start with it as soon as possible as you start earning because Insurance of the same coverage amount will be costlier in your pocket if you delay taking it.

         Here is a Thumb Rule to get insured which everyone must follow Religiously that your Insurance cover must be equal to or more than ten times your annual income and if it is achieved that means you are financially on right track. Also, your insured amount Cover must be decided by catering your surviving dependents, because in case of any mishappening with you the insurance cover must take care of all the needs of your spouse and they should be financially independent after you. Any loan outstanding if any, then the same amount must also be added to the coverage cover.

         There are many Life Insurances available in the market like Term Plans, Whole life policy plans, Money back plans, Endowment Plans, and Unit Linked Plans. But I must say that all are avoidable except Term Plan. So you must purchase only Term Insurance Plan that’s all for Life Insurance.

Insurance

         Term Insurance Plan 

It is a complete Term plan which is decided for a specific term and you have to pay Premiums on a regular base to the company lets say for 30 years or 40 years. So example, if you buy a plan for a cover of 1 Crore, and you pass away before the completion of that specific term than the company will pay your family one Crore. If you survive throughout the term than the company is not liable to pay you anything. This type of plan is cheapest and effective and the premium amount for the same cover keeps on increasing as you delay purchasing the plan.

            Buying a Term Insurance plan online, as it removes agent commission cost.

Health Insurance

                             It is second important and you must have in your basket. Here the company will look after your medical expenses in case of any problem with your health and you have to visit Hospital. There are various Health Insurance plans available in the market like Individual Plan, Family Floater, Maternity Insurance, Personal Accident Cover Plan and many more. Here are some points you must look into before going for Health Insurance:-

⇒ The total sum insured must be as per the residing location and the Hospital charges around you.

⇒ The plan must have ‘”Lifetime Renewability” option in it so that you can renew it on the same cost otherwise, as your age increases the cost of Plan for the same sum insured amount will keep on increasing. this is mandated by IRDA (Insurance Regulatory and Development Authority) of India and no company can deny it to you.

⇒ Your policy must have ‘Top Up” or ‘Restore Limit‘ option which simply means that in case of spending because your health treatment goes beyond the sum insured limit than that extra can be topped up by paying an additional premium.

⇒ Search your policy guidelines for ”Co-Payment” or ”Sub Limit” options which must be minimum. This option simply means that the insurance company specifies a limit for your expenses and any expense beyond it will be borne by you. Sometimes Room Rent, Diagnostics and Doctor fees are common uses as sub-limit. 

⇒ If you have any disease, then it must be honestly declared to the company prior to taking the Insurance because companies have a ”waiting period” for starting the coverage of pre-existing diseases and which can be from 3 to 5 years. The company has the right to reject your claim within that period for the declared disease. So choose the insurance which has less time in terms of the waiting period.

⇒ Confirm that Daycare and OPD Expenses must be covered in your health cover because most plan covers for only overnight admission into hospital or a minimum of 24 hours in the hospital. but nowadays many medical surgeries require an admission of fewer than 24 hours so in that case the expense will be excluded by the company.

⇒ Check your policy for any exclusions as the policy will read out all the diseases, conditions, medical services that will not be covered by the company.

⇒ Ask about the cost before and after hospitalization.

⇒ Look at the No Claim Bonus procedure in policy, simply means that if you don’t make a claim in a particular year, the company rewards you and mostly in terms of raising cover by 10%.


⇒ Research the company providing cover about its management, Hospital reach, claim settlement ratio and claim settlement time with Third-Party Agreement so that you come to whether its TPA is good or not and its Hospital coverage is large enough or not.

⇒ As it is not feasible for a normal working-class person to do all search so, MintSecureNow Mediclaim Ratings, you must look for and compare the policy. The Livemint site automatically compares all variables of policy among various companies and you can choose the best among them.

Accidental Insurance and Disability Cover

                        Accident insurance is a type of financial product that pays out a lump sum if you met with specific kinds of injury as a result of an accident. So this cover will protect against any Disability which results in your loss of a job or limiting your capacity to earn.

⇒ You should not go for a ”Short term disability plan” which covers less than 5 years of disability, instead, go for ”long term plan”.

⇒ The company pays a lump sum in case of death due to an accident to the nominee or pay a monthly sum in case of disability due to an accident.

Home and Luggage Insurance

              Your home and its associated material are most precious so you must be well insured. 

⇒You do not have to insure the house for the ”Value of property” which include the cost of land, locality and its construction

⇒ you must Insure House for ”Reconstruction cost” in case of any mishappening.

⇒ it does not matter whether you are residing in the house or not.

Motor Vehicle Insurance

               Nowadays, the government made it mandatory for all vehicle holders to have insurance for their vehicle and it made mandatory for agencies to complete it at the time of purchase only. But the selection of insurance from next year onward is totally on vehicles holder and he can go for full cover or just Third party cover. It is highly recommended to go for Full Insurance cover every year as it has its own benefits.

⇒ Also, you must opt for the ”Cashless repair” clause so that vehicles get repaired without paying money so that making claim and all be avoided.

The insurance sector is under the close watch of IRDAI and all the elated information for Insurance, approved companies in this sector, and terms and conditions to follow, etc can be accessed by visiting the official website of IRDAI.

Final Note: Never mix Insurance with Investment which means never look for returns from Insurance policies.