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Why Choosing A Lumpsum Payout In A Term Life Cover Is A Good Idea
[Posted by: InsuringIndia Blog on Tuesday, October 18, 2016 2:04 PM]
In today’s time with skyrocketing prices and challenges of daily life, choosing the best life insurance option is a tough task. Insurance experts opine that a term life cover is the best possible option. This is because it has cheaper premiums, takes care of your kin and their future financial goals. The best part is that with changing times older people in the bracket of 75 years and above can also avail of its benefits. Given these factors, it makes sense to opt for a lumpsum payout rather than a fragment one. This blog explores why.
A term cover provides security and cover only for a fixed duration that may differ from 10-20 years. The policy holder has the choice of paying premiums for the term, annually, half yearly or quarterly. In a nutshell, if a policy holder dies then his family receives a lumpsum from the insurer. It’s important to note that if a policyholder outlives the period of the policy, then he does not receive any payout from his insurer.
In the current scenario, the policy holder has a choice wherein a portion of the sum assured is paid as a lump sum. Thereafter, the rest can be given as monthly payouts. There is another alternative where the entire sum assured is divided into monthly payments or the policy holder can make monthly payouts gradually which increase for a certain number of years. 
But before opting for a lumpsum payout, there are two major point that should be considered. Firstly evaluate how much you can pay based on the salary you earn currently, monthly and yearly savings and expenditure. Also factor in that your future income will only rise from the current income. The second point to be considered is that the value of money today is much more than what it will be in the future. The latter is a significant fact as you can invest the lump sum amount received and earn returns over the years. 
Benefits of Term Plan
1.      A  Term insurance cover can be used as a finance planning and risk management tool. For instance, if you’ve taken a housing loan for a long time, then you can purchase a term policy of corresponding value. The premium payable for a term policy is linked to the outstanding principal over a period of time. It will decrease over the period as both the tenure as well as the insured amount decreases. In case of death of the primary earning member who is repaying the loan, the family does not lose the home as the insurance company will repay the outstanding loan amount.
2.      Buying term insurance online will reap rewards and you can add riders of your choice. These comprise accidental death benefit, terminal illness cover and premium waiver.
3.      Depending upon your insurer, if your policy requires some medical tests, they  may be covered.

Micro Life Insurance Plan :What Does It Entail?
[Posted by: InsuringIndia Blog on Monday, October 17, 2016 10:57 AM]
These days, life has become challenging and hectic for everyone residing in urban and rural India. While a large section of people can afford life insurance, there are many in the bracket of weaker sections who find this a daunting task. With a booming insurance sector is there any space for these potential buyers? Yes. Micro life insurance plans are the correct answer as these are designed to cater especially to those who are in the lower income group.
As compared to conventional life insurance covers, these policies offer a lower coverage to the policyholder, in terms of a low premium. Even the sum assured sum of Rs. 50,000 or lesser depending on the type of plan opted for. But the policy holder has the option of availing other benefits. These include protection against accident, partial disability benefit and also death benefit. This does not require any access to banking or financial institutions. Typically these policies require three types of intermediaries for facilitating micro insurance. These comprise NGOs, self-help groups and the micro-finance institutions.
Anyone within 18-55 years of age bracket can apply for these plans. It is valid for domestic helps, vendors, agriculture and construction laborers etc.
        i.            This plan also includes health insurance contracts in its ambit, making it a win-win situation for the policy holder.
      ii.            The policy holder is provided a flexibility option. This means he can either choose health insurance or club it with general insurance for a dual benefit.
    iii.            Lower premium as compared to conventional life plans.
     iv.            Plans have been customized my many insurers to suit the needs of the policy holders in rural areas.
       v.            Accident Benefit is an important aspect of these plans. In fact, many insurance companies factor in the option of life risk with accident benefit to the policy holder. Also, various other permanent disabilities are also covered here.
     vi.            These plans are not complicated. Rather they are designed very simply to offer life insurance cover and also sum assured is given at the time of maturity.
    vii.            Typically, these plans do not expect the policy holder to undergo any medical tests.
 viii.            There is no prerequisite to buying these plans.
     ix.            Micro insurance plans also offer coverage for huts, livestock, instruments, etc.
       x.            These plans can be purchased on an individual cover or as a group cover.
     xi.            Depending on the type of insurer chosen, some of these plans come without accident benefit rider also.
   xii.            These plans are term insurance that comes either with premiums returns or without premium returns or can an endowment contract as well

What is Long Term Care Insurance (LTC)
[Posted by: InsuringIndia Blog on Friday, October 07, 2016 1:31 PM]
With escalating cost of everything including medical care, it is very important to invest an insurance that will see you through your sunset years. While purchasing a health insurance is a sensible decision, your security can be further bolstered with a Long Term Care Insurance. This will not only give you and your kin peace of mind but you will also be able to lead a life of independence and dignity. 
Typically, this type of insurance facilitates skilled nursing, inter-mediate care, or custodial care for a patient (generally over age 65) in a nursing facility or his home residence following an illness or an injury. It is also helpful for the patients who are physically/mentally challenged. This policy includes a host of facilities within its ambit. These include physical assistance for regular activities like taking medicines, maintaining personal hygiene, taking medicines, aiding patients for performing daily functions like brushing teeth, bathing and maintaining high standards of hygiene around the patient.
An LTC is very useful during critical situations where providing timely medical treatment is potentially a lifesaving factor. It’s also adept in providing emergency health care, transportation of patients to hospital, taking them for Diagnostic tests, X-rays, etc. Essentially, long-term care provides a holistic and comprehensive health care service and assists the patient to restore good health and also more importantly sustain the good-health.
Myths surrounding LTC
•         It is not essential to buy this policy: An ailment or accident can happen anytime, anywhere to anyone. It makes sense to buy this policy as it is a good fall back option to any medical crisis.
•         It will add to the costs: No. In fact, having an LTC policy will bring down long term costs. Besides you can also weigh in the factor that you may not require full time admission to a nursing home and you can be taken care of, at home itself. By investing in this, you are ensuring that your family has peace of mind, knowing that you are taken care of. 
•         A good health insurance is a far better option than the additional burden of a LTC. This is not true, either. While a health insurance is a must for everyone, you must keep in mind that it can be very restrictive. So in this scenario, having an LTC is a good option. Many health insurance policies cover overall hospitalization costs, whereas LTC will cover day-to-day  costs.
•         LTC is meant for only disabled or mentally challenged people: No. Everyone in their sunset years must opt for this policy because it is the key to an independent life, with dignity.


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*This is based on the difference between the highest and lowest premium's for a single person, age 25, looking for an individual health policy with the sum insured of Rs. 5 lakhs.
**This is based on the difference between the highest and lowest premium's for a single person, age 25, looking for a term plan, with the sum insured of Rs. 30 lakhs, and the premium paying term of 30 years.
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