Moneylife Foundation hosted an insurance session by Raj Pradhan for management students of Centre for management, Bandra (Mumbai). Mr Pradhan gave insights to an eager audience of B-school students on different types of insurance ranging from personal accident, life, health to car, travel and home insurance. Personal accident (PA) is a must-have for everyone. PA cover premium is inexpensive and remains unchanged, even though most products are offered only till 70 years. PA covers accidental death and disability.
Health insurance is skipped by students and young generation, but there is rise in lifestyle related diseases and even hospitalisation for gastric related issues. Even if students don’t buy health insurance, they should know the terms and conditions of the mediclaim policies of their parents. It is important not just to have right mediclaim, but also being able to get the claim paid by following the proper procedure and honouring the timelines given for hospitalisation intimation and claims filing. Critical illness can be thought as an add-on to your mediclaim. It will pay lump-sum irrespective of your expenses on medical condition. It is useful as many times after hospitalisation you may not be able to work for an extended period and mediclaim will not cover beyond hospitalisation expenses and few months of pre and post hospitalisation expenses.
It is imperative to get adequate life insurance for financial risk protection against death of a bread-winner in the family. There are different avenues to do it like Term Life, Endowment, Money-back, ULIP, Whole Life, etc. While a term plan is pure life insurance the others are insurance-cum-savings products. It is best not to mix insurance and investment needs. There is increasing awareness of online term plans and people are finding it to be attractively priced.
Buying life insurance policy in utmost good faith will ensure your family does not have to run from pillar to post to get the death claim paid. Every insurance company will repudiate fraudulent claim. Hiding a medical condition at the purchase of the product is as good as wasting the premium payment. Insurers know how to detect a fraud which can entail services of detective agencies.
Third party liability car insurance is mandatory, under tariff and inexpensive. It is important to ensure your car/two wheeler has this cover. Own Damage cover is optional, but gives comprehensive cover for your car. Shop for car insurance as premiums vary across insurance companies and even across channels like online, agents, car dealers, brokers, etc.
Overseas students and travellers should consider buying health insurance as medical treatment can be unaffordable abroad. Beware of fine-prints and check which hospitals offer cashless network. Paying upfront from own pocket can be expensive.