Insurance
What is a Term Assurance?
Term assurances are the purest and cheapest form of insurance. Term assurances are plans where benefits are payable only on the death of the policy holder within the term.
What is Whole Life Plan?
Whole life plans are a special type of term assurance wherein the term of the policy is whole of the life. So it follows that benefits under the policy are payable only on death of the policy holder.
What is an Endowment Assurance Plan?
Endowment plans are among the most popular forms of insurance as they provide both insurance coverage and also act as a savings instrument. These are the plans wherein benefits are payable on death within the term or survival to maturity whichever is earlier.
What is Money Back Plan?
Money back plans are a special type of endowment plans and are also called as anticipated endowment assurance plans. Under money back plans, survival benefits are spread over the term of the policy i.e., certain percentage of sum assured is paid at regular intervals. Apart from the above death benefit continues like an endowment plan i.e., full sum assured shall be payable on death within the term irrespective of earlier survival benefits.
What is Nomination?
Nomination is the process of identifying a person to receive the policy money in the event of the death of the Policyholder.
When to Nominate?
Nomination can be done at the inception of the Policy by providing details of nominee in the proposal form. However, if the nomination is not done at the inception of the policy, the policyholder can nominate at a later date. This nomination has to be effected by giving notice in a prescribed form to the insurer and getting it endorsed on Policy Bond.
Change of Nomination
Change of Nomination can be done by the Policyholder any time during the term of the Policy and any number of times. For this, the policy holder has to give a notice in a prescribed form to the insurer and getting it endorsed at the back of the Policy. Further, Nomination can be removed any time by the Policyholder without giving prior notice to the Nominee.
Procedure for Nomination
Nomination can be done only by a policyholder who is a major holding Policy Bond in his own name. In the case of Children's Policies, Nomination is not done until the Child becomes major.
Rights of a Nominee
Under Nomination, the Nominee gets only the right to receive the policy money in the event of the death of the Policyholder. Nomination does not pass on the property in the Policy. If Nominee dies when the Policyholder is still surviving then the nomination would be ineffective. Nomination has no effect if the Policyholder is surviving. If Nominee dies after the death of the policyholder but before receiving policy money, then also Nomination becomes ineffective and money can be claimed only by the Legal Heirs of the Policyholder.
Can I take a loan on my Policy?
Policy holders are eligible to take loans on their policies subject to certain rules. The policyholder has to apply for a loan in a prescribed form and submit the Policy Bond with the form duly completed. The loan amount is calculated depending on the Surrender Value (SV) that the policy would have acquired, and approximately 85% of the Surrender Value is given as loan. Rate of interest charged varies from company to company and time to time.
How can I revive a Policy?
A policy gets lapsed if the premiums are not paid within the due date or the period of grace permitted by the insurance company. However, a lapsed policy can be revived and procedure varies from company to company.
What is the procedure in case of a lost Policy?
The policy issued by the insurer is a valuable document and should be stored in a safe place till its maturity. In case the policy gets lost, destroyed or mutilated, then the policy holder must immediately procure a duplicate policy.
The need to possess a duplicate policy arises on the following occasions:
- At the time of receiving Maturity Amount or Death claim.
- To obtain Surrender Value/Loan.
- To obtain a Duplicate Policy in other cases.
What are the Tax benefits available?
Important Income Tax provisions applicable to Policyholders are :
An individual can claim rebate on premium paid on his/her life, his/her spouse, his/her children including adult children and married daughter.
Under section 88 of the Income Tax Act, certain percentage of rebate is allowed on investment in the form of insurance premium with any of the insurance company approved by IRDA. Percentage of rebate can be up to a maximum of 20% and varies depending upon the tax bracket one falls. This rebate is deductible from the tax payable by the individual. The total amount of investment in the form of insurance premium and other specified investments like PPF, NSC, etc. is restricted to Rs. 60,000 per annum.
Under Section 80 DDA a deduction up to Rs. 40,000 p.a is allowed from gross total income, when a contribution or deposit is made with the LIC for the maintenance of a handicapped dependent.
Under Section 80 CCC a deduction up to a maximum of Rs. 10,000 per annum is allowed from gross total income.
Any sum received under insurance policy including maturity bonus etc., is non-taxable. The exceptions to this are Keyman Insurance, Jeevan Aadhar, Jeevan Dhara, Jeevan Akshay policies.
How much life insurance should an individual own?
An individual can have life policies for any amount. However, in practice, it is determined based on the needs for insurance and the capacity to pay premiums regularly.
What is the benefit of opting rider's/add ons?
Riders/add ons are the additional benefits which can be added to the basic policy by paying marginal additional premium. Each company has got their own set of rider and most common rider's offers by insurers are:
- Term rider.
- Critical illness rider.
- Accidental death and dismemberment rider.
- Waiver of premium rider.
For all of your Life Insurance needs!
Your insurance needs will change as your life does, from starting to work to enjoying your golden years and all the stages in between. Each one of these stages may pose a different insurance needs and cover for you and your family. In this section, we have drawn up the basic life stages that will help you analyze various insurance needs accordingly.
Getting started
- Young & single
- Just married
- Planning for retirement
- Proud parents
Life Insurance Needs
Your Needs when you are young and single
- Save for a home and wedding
- Tax Planning
- Save for Golden Years
Your Needs when you have just married
- Planning for home/securing your home loan liability
- Save for your first child
Your Needs when you are planning for retirement
- Provide for regular income post retirement
- Immediate Tax benefits
- Lead a secure, independent and comfortable life style in your retirement years
Your Needs when you have become proud parent
- Provide for children’s education
- Safeguarding family against loan liabilities
- Savings for post-retirement
We are ready to give our support for your Life Insurance needs and will be pleased to have a meeting with you and discuss the unique benefits of our products and services, which you will find extremely attractive and beneficial to you.
!! Assuring you of our best services always!!
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