Insurance is not only a great investment option but is a great way to provide for two risks -- dying too young and living too long!
Which is the best insurance policy to opt for? Is insurance actually a good investment option? Which company provides the best health cover for senior citizens? Which policy should the youth buy?
In an hour-long chat on rediff.com, insurance expert Harsh Vardhan Roongta answered to many such readers' queries.
Here is the transcript:
Harsh Roongta says, Hello and welcome everyone. My name is Harsh Roongta and i am the CEO of Apnainsurance - a market place where you can compare various insurance products and depending on your requirement get referred to various insurance companies. I will answer as many questions as my typing speed allows. Would request you to read the chat transcript as a question similiar to yours may already have been answered. So let's get started.
Anirudh asked, I am 32 running...which insurance should i opt for...i am not having any chronic diseases...am looking for some scheme which gives me decent returns on maturity as well as a decent amount in case of any eventuality...what premium do i need to pay say for a cover of 50 lacs?
Harsh Roongta answers, at 2008-04-23 14:55:17The first thing that you must look for in any insurance plan is the risks that it covers. Apart from the risk of death (which means you will need to have enough cover so that your family can get enough income to maintain their current lifestyle)you should also look at the risk of critical illness such as stroke, organ failure, etc(which you might survive but which might adversely affect your earning capacity)and medical cost risks. At Apnaisnurance our advise to the consumers is to segregate their insurance requirement and their investment requirements. For your investment requirements you should definitely evaluate mutual funds, small savings apart from ULIPs and take a desicion in conjunction with your personal finance advisor. In most cases unless you plan to invest for more than 10-12 years ULIPs may not necesarily be the best option to invest in.
Syam asked, Hi Harsh, Good Evening. my age is 34.I have 19L LIC endow, 80L term with LIC+HDFC. For LIC Endo, i'm paying nearly 1.3L p/a since last 5 years. As per the policy, i will get 3 L p/a after 15 yrs of policy for 10 yrs. pls. suggest whether to continue the same
Harsh Roongta answers, In most cases it will not make sense to stop making payment on an endowment policy. However you are paying a large amount and you need a detailed woirking to find this out. At apnainsurance we are making a calculator that will help you take this desicion. But meanwhile you can write in to us with details of the surrender value of the policy, tenure, bonus entitlements etc. so that we can provide a more specific answer. You can write in to my collagues apnaloan id (the apnainsurance ids are still being created) at kairav@apnaloan.com .
Jignesh asked, Can i pay my insurance primum through a credit card if yes than do they charge any extra interest
Harsh Roongta answers, That depends on whether your credit card company has a tie up with your insurance company or not. If they do then there will be no extra interest payment as long as you pay off the full amount due on the credit card on the due date.
oliver asked, I would like to go for a plan which gives me a good amount of risk cover and at a relatively lower premium? what would you suggest me.
Harsh Roongta answers, Go for a pure term plan. All companies offer such plans at the lowest possible cost. You can compare plans available to you at market places like www.apnainsurance.com and then take a desicion.
sanjoy asked, In Birla Sunlife insuirance they said that 100% allocation but after receiving policy seen that the amount deduct in the shape of unit. That means at the time of deduction if market downward then I will be in loss.As per your opinion the policy of Birla is as compare to other is profitable or loss?
Harsh Roongta answers, It is very difficult to answer queries related to specific policies simply because there are so many polcies out there with hugely different terms. But to give a relevant reply please understand that there can be no ULIP policy without some form of dedcution for the costs incurred by the insurance company (these deductions may happen immediately on policy issuance or or over a period of time- but they definitely will happen). In terms of whether the polciy you ahve is better than others or not a good parameter (but not necessarily the only one) to check would be what percentage of the premiums are dedecuted as costs.
sudesh asked, I want to take a Term plan for 15lakhs. Please suggest which insurance company shall i prefer.
Harsh Roongta answers, Look around in the market and select the cheapest one. You can use the services of sites such as apnainsurance.com for such purpose also. If you are a non -smoker and in perfect health would recommend Kotak's preferred term policy meant exclsuively for non smokers. But please do compare with other polcies available in the market before deciding.
yogivaze1 asked, Hello Harsh, What is better ULIP or MF+Pure Insurance
Harsh Roongta answers, In most cases it will be MF plus Pure insurance.
Mohan asked, Dear Sir, Can you suggest some good policy for my daughter's future needs like education & marriage expenses.
Harsh Roongta answers, It's a great idea to save for your daughter's future needs. As already suggested earlier in the chat please do not restrict your choice only to a suitable insurance policy. there are several other options (such as mutual funds, small savings, etc.) which also should form part of your consideration set. Your post tax returns may be comparable or better in most cases for similiar risk investments outside an insurance policy as well. Off course please do not forget to tajke adequate insurance cover for risks such as death and incapcitation from an insurance company so that your diaughter's future is not affected by any unfortunate thing happening to you. All that we are recommending at Apanisnurance is to separte your desicion for investment and for insurance.
ketan asked, Hi harsh i want to buy medical insurance whether it takes from life insurance companies rider or gen insurance company mediclaim
Harsh Roongta answers, Excellent question. At teh risk of oversimplyfying let me quickly summarise the differences: Life insurance comapny's health plans are primarily what are called hosipitalisation plans - in that you get a fixed allownace on the happening of a covered event like hospitalisation (irrespective of the cost that you may incur). Non life companies offer such plans as well but also have expense reimbursement plans more pouplarly called "mediclaim" plans. Both these polcies serve different needs - the "mediclaim" kind of plan helps you meet the expenditure you may incur in the hospital whilst the hospitalisation policy helps you recover a part of the lost earnings or some other expenses that are not covered by the mediclaim kind of policies. The other big thing is that life insurance companies offer a savings element whereas the non life companies have a pure insurance cover. Another thing is that life insurance companies offer cover for long period of time which cannot be withdrwan whereas the tenure of a policy from a non life company will generally be restricted to a max of 2-3 years. Also non life companies have a right not to renew the policy at the end of the tenure as well as cancel a polciy midway through the tenure by refunding the pro-rata policy premium. Hence the conclusion could be that for hospitalisation kind of polkcy the life insuarnce companies are a good bet but there is no substitute for the non life companies for the mediclaim kind of policies.
skb66skb asked, i am 64 yrs. Suggust good policy.
Harsh Roongta answers, Unless you are earning and have dependents the only polciy you need are health insurance policies. Off course you should also explore buying an immeidate annuity plan from any insurance company if you are curently not earning.
jarin asked, Hi Harsh, I am 30 years old and i look looking at insurance surely for risk cover and not for investment and keeping that in mind I have decided that term insurance is the best option for me. Could you let me know if I right? Also please let me know if given my age if I am likely to get a term insurance for 35 years? Which term insurance policy would u suggest?
Harsh Roongta answers, Great desicion. Please also also consider taking critical illness and accident cover as well as other health insuarnce plans. To the best of my knowledge the maximum term for a term polciy being offered today is 30 years. Go for the cheapest available option. You can use the services of sites like www.apnainsurance.com to explore and reach the maximum number of relevant insurance companies.
Mahesh asked, my age is 32 can i get insurance+mediclaim+Pension Plan in One Policy Pls help
Harsh Roongta answers, To the best of our knowledge such a polciy is not currently being offered in India.
jgrastik asked, Are there any Insurance Company for Insurance Companies like Reliance, Kotak,LIC, or they take their risk on their own?
Harsh Roongta answers, Great question. Most Insurance companies shift a part of their risks to other insurance firms (in India or overseas) who are called re-insurance firms. Each company has its own polciy as to the extent of risk that they keep on their books and teh balance is shifted to re-insurance companies abroad.
SSBHATIA asked, Sir, I am a 52yr old and wants to buy an insurance policy which will help me at the age of at least 62yr. which policy is suitable to me sir. thanks
Harsh Roongta answers, for what risks ???
Rahuls asked, I am 32, I have a kid 1year old and wife , What kind of investments should i look for? so that i can have money time to time
Harsh Roongta answers, Apnainsurance recommends you separate your insurance and investment needs. Your insurance polciy will take care of the risks involved and the investments will take care of your time to time money needs. Please see the following link for a similiar answer. http://www.apnainsurance.com/life-insurance-query/query/Question18.html
cp asked, Which is the best Insurance Policy for Dependents, as i am planning one for my Wife, who is 24 yrs Old ?
Harsh Roongta answers, I am assuming you are talking of life insurance and of covering the risk on your own life for the benefit of your dependent. It makes absolutely no sense to even consider taking a life insurance policy on the life of a person who is not earning (such as children or your non -earning spouse). Off course you need polcies on them as well to cover risks such as health.
harsh asked, pl.suggest me if there is any flooter mediclaim policy which should be opted or we should opt for family maediclaim individual policy
Harsh Roongta answers, Excellent question. Personally given the fact that premium to cover all the family individually versus taking a flaoting cover is only marginally higher, i prefer the family individual polciy. The risk in a floater polciy arises if more than one member incurs the risk during the tenure of the policy. In that case your claim is restriced to the total value. However must hasten to add that it is difficult to quantify such risks and the floater schemes are good as well especially where budget is a constraint.
saugat asked, Hi my age is 28, Which is the best term policy for me?
Harsh Roongta answers, go for the cheapest available plan.
sureshg1972@rediffmail.com asked, Will the premium be the same if we apply for insurance thru apnainsurance versus approaching the insurance company directly?
Harsh Roongta answers, Off course. Premiums are fixed by the companies and filed with IRDA and acnnot be changed. In any case let me clarify that we are not an insurance agancy nor an insurance brokerage firm. Apnainsurance only provides free information and general financial advise to its readers and they are free to approach any insurance company (or their agennts) of their liking. They can also use our referral module to get referred to relevant multiple insurance companies (or their agents). Apnainsurance makes its revenues from advertisements and referrals and not from commissions.
Smitesh asked, Should we get mediclaim on the age around 28 or to invest in other ULIP
Harsh Roongta answers, These 2 things are not either or. Both serve compeletly different needs.
TM asked, Hello Sir, I am a working woman and have medical cover from my company for me & my dependants. Is it a good idea to go for another personal mediclam policy?
Harsh Roongta answers, Excellent question. Normally the group policy that your employer will have taken will not allow you to carry your claims history with you if you decide to leave the particular employment. That means if you do happen to leave that job (but in the meanwhile there has been an illness to any of the covered persons) than it will be an pre-existing illness as far as taking avrresh independent polciy is concerned. For somebody who can afford it and is also likely to switch jobs it might be advisable to have an independent polciy as well. Must hasten to add that this can be expensive and may not really be needed but is advisable if you can afford it.
Harsh Roongta says, I am simply iverwhelmed by the number of questions that have come on this chat. Have found it impossible to answer all of them. Please read the chat transcript as a question similiar to the one you asked may already have been answered. You can also log in to www.apnainsurance.com and click on the insurance guru section and ask your query there. Thank you and good evening everybody.
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