Insurance is a highly misunderstood product and it’s often bought and sold for the wrong reasons. At the same time it’s a very important part of your life and you must know certain ground rules for making the right decisions in this year. Many of us consider insurance just another investment for tax saving. Our day-to-day life is full of unpredictable risks for example loss of life, loss of income, critical illness, disability etc. Insurance planning means figuring out adequate cover against “insurable risks” and getting the maximum out of the premium you pay. Tax exemption is just another aspect of it.
Insurance is for the earning member of the family
Life insurance is a replacement for your income. When your income ceases or falls insufficient either due to death, illness, retirement or a major goal such as children’s education or marriage, insurance fills in the gap. On your death, the money received from term insurance policies will provide a corpus with which the family can pay off debts, convert dreams to reality and still lead a comfortable life. You must have seen cases of non-working mothers or non-earning family members getting insured. It goes against the fundamental principle of insurance.
Therefore it’s important that the breadwinner covers the risks to his life and income, so that his family’s quality of life is not compromised after he is gone.
Life Insurance is a contract by which you can protect yourself against specific losses by paying a premium over a period of time. Since each one of us, during our lives are faced with numerous risks – failing health, financial losses, accidents and even fatalities, our instinct drives us to cover ourselves against those risks. Though an insurance cover can’t protect you against the emotional losses arising out of these risks, it softens the economic crisis that usually accompanies these losses. Simply put, life brings with it many surprises, both pleasant and unpleasant. By taking a Life Insurance Plan one can ensure that he / she is better prepared to face uncertainties in number of ways.
Life throws challenges at us all the time. One way to ensure that you always come out on top is to opt for health insurance. The premiums are a small price to pay to ensure not only peace of mind but also financial support for a wide range of illnesses. According to a World Bank report published in 2012, the out-of-pocket expenditure on health (percentage of private spending on health) stood at 87.0% in 2011. The only way to make sure that you aren’t part of this staggering figure is to insure yourself and your loved ones. Whether there is a terminal or critical illness or if one meets with an accident, having health insurance ensures that you and your family aren’t put through a huge financial burden. Secure your future and your finances by making the right choice.