Insurance Plans

Types of Life Insurance:

• Term Insurance: It is one of the most basic and simplest life insurance product. It covers you for a specific timeframe. The biggest advantage of term insurance is, you can get a large amount of life cover (i.e. sum assured) at a relatively low premium rate.. The amount received is tax-free and can be used by your dependents as and when needed. However, if you survive the policy term, no benefits will be paid to you or your family. Please use the term insurance calculator to determine the cost of the policy based on your desired coverage and rider benefits.
• Whole Life Insurance: the policy covers you for a lifetime. Your loved ones will receive compensation in the event of your unfortunate demise. Moreover, your dependents are also entitled to a bonus that usually accumulates on the policy over time.
• Endowment Plan: Much like term life insurance, this policy covers you for a specific period. A lump-sum benefit is given to your family in the event of your sudden death. However, unlike term insurance, you are entitled to receive maturity benefits after the policy term is over.
• Unit Linked Insurance Plan: ULIP provides dual benefits – life insurance cover and investment. A part of the premium is used for life insurance cover; whereas the remaining amount is invested in equity or debt funds. The policy pays a lump-sum benefit from the life insurance cover to your loved ones after your death. Additionally, it also pays the returns gained from the investments.
• Child Plan: Child insurance plan is an investment cum insurance plan, which offers financial safety to your child’s dreams and goals. With such a policy, your child remains protected in the event of your unfortunate demise. You can use a child insurance plan to invest in the big life goals of your child like higher education and marriage.
• Pension Plan: This policy allows you to build your retirement fund. That way, you continue to receive money, even after your retirement. However, the sum assured can be claimed by your loved ones after your death.

Tax Benefits on Life Insurance

The amount paid towards life insurance plans can be claimed for deductions under Section 80C of the old income tax regime. However, you can claim up to Rs. 1.5 Lakh under this section. 
Moreover, the premium amount used for a tax deduction cannot exceed 10% of your sum assured amount.
The death and maturity benefits received on the policies are tax-free under Section 10(10D) of the Income Tax Act, 1961.

Types of General Insurance:

• Health Insurance: A health insurance plan covers the expenses incurred due to sudden medical contingencies. You can either avail a cashless claim facility at a network hospital enlisted by your insurer or claim of reimbursement after completing the treatment. Things that are usually covered in a standard health insurance plan in India are as follows:
  • Hospitalisation and medical expenses
  • Treatment of enlisted critical illnesses
  • Pre- and post-hospitalisation expenses
  • Daycare procedures
  • Maternity and newborn cover

In addition to these benefits, health insurance also provides tax benefits. You can claim a deduction on the premium amount as follows:

• You and your parents (All below 60 years of age) – Rs.50000/-
•  You and your parents who are senior citizen – Rs.75000/-
•  You (If you are a senior citizen) and Your Parents who are senior citizens – Rs.100000/-
  
  
• Motor Insurance: Motor insurance provides financial protection to your motor vehicle in case of damages/loss due to accidents, theft, and natural or man-made disasters. You can buy motor insurance for your private as well as commercial vehicles. Moreover, motor insurance is a mandatory policy under the Motor Vehicles Act, 1988. There are two types of motor insurance plans available in India.

• Car Insurance: Car insurance plan is the financial protection against unforeseen events like accidents or theft. In India, you can either buy a third-party car insurance plan or comprehensive car insurance plan, depending on your requirements. A third party car insurance plan covers third-party liabilities only. This policy is affordable but offers limited coverage. A comprehensive car insurance plan, on the other hand, provides extensive coverage. It covers third-party liabilities and damage to your vehicle as well.
• Two Wheeler Insurance: Similar to car insurance a two wheeler insurance policy is a financial protection plan for your motorcycle. So, whether you ride a scooter or bike in India, you will need a bike insurance plan. Two wheeler insurance is also available in two types: third party bike insurance and comprehensive bike insurance. A third party bike insurance has limited coverage as it covers third-party liabilities only. If you want extensive coverage for your two-wheeler, it is best to buy comprehensive bike insurance.

• Travel Insurance: a travel insurance plan protects you against any financial liabilities (medical or otherwise) during your travel abroad or within India. The things that are usually covered under a standard travel insurance plan are as follows:
• Baggage loss
• Sudden medical contingencies
• Passport loss
• Hijacking
• Flight delay/cancellation
• Accidental deaths

Based on your preferences, you can buy an individual travel insurance plan, a family travel insurance plan, or student travel insurance plan.

• Home Insurance: Home insurance is a policy that financially protects your house against damages/loss due to natural and man-made calamities, fire, or burglary. The cover is also extended to the valuable items inside your home. A few types of home insurance plans available are as follows:
• Home building (structure): Provides financial protection to your home/property.
• Household articles (content): Provides financial protection to valuables inside your house.
• Home building (structure) & Household articles: Provides financial protection to both your house and the valuables inside it.