Insurance Bytes

Life insurance is a way to make good the financial loss of the dependents in case the breadwinner passes away. It is a means to financially secure the aspirations and lifestyle of the dependents in the absence of the breadwinner. And hence only a person who earns an income can be insured. But what about those people who nevertheless provide a critical service but do not get reimbursed. A housewife manages the cooking, laundry, upbringing of the children, oversees their studies, takes them for various extracurricular activities, inculcates good values, takes care of aged parents and in-laws and handles various miscellaneous tasks. In a nutshell, a housewife ensures that the breadwinner (husband) can concentrate on his career without getting stressed out on the various nitty-gritties of running a house. However, what would happen if she meets with an untimely death. The tasks mentioned above would still need to be carried out. A housekeeper, cook, tutor all may need to be hired. Th...

Rajesh is a 35-year-old techie working with an IT major. He has two children aged three and one. Of late, he has started seeking investment avenues that will help him build a corpus to fund long term financial needs like his children’s higher education, his retirement etc. He has seen advertisements and read articles in newspapers extolling people to invest in mutual funds for long term wealth generation. However, he is highly risk averse and does not want to invest in mutual funds or stocks or for that matter in any investment which carries a risk of losing his hard-earned money. His philosophy is that it is better to get guaranteed returns even if they are lower rather than aim for higher returns which carry a risk or an element of uncertainty. On hearing his requirement and understanding his low risk profile, his friend Ashish who is a financial advisor suggested that he purchase an endowment plan. Rajesh was interested and wanted to know more. This is what Ashish had to say: ...

Rajesh is starting an online venture with his friend. He has used a substantial part of his savings and has also taken huge loans to fund the venture. Rajesh is married with two school going children. His wife is a homemaker. Rajesh realizes that should he be unable to pay his creditors his assets (house, car, fixed deposits, mutual fund investment, life insurance proceeds etc) will be attached by his creditors to recover their dues. Rajesh wants to ensure that his wife and children’s future is not impacted in case of such an unfortunate eventuality. He plans for this contingency by taking a term life insurance policy on his life under the MWP act. But isn’t a life insurance policy a part of his asset and why would his creditors spare the policy? The answer to this lies in it being a MWP act policy. Read on to know more about the MWP act and the benefits associated with it. What is MWP act? Married Women's Property Act 1874 (MWP Act) was created to protect the prope...

As kids, we all would have heard at some point of time our elders talking about having a Mediclaim policy, we knew that it was something to do with hospitalization. In recent years, we have started hearing a new term Health Insurance. Is this health insurance same as Mediclaim? Is health insurance just a new name given to Mediclaim by the private insurers or is it something different? This is a question many people have. Let us find out in this post. Mediclaim deals with hospitalization (only). It aims to do good the monetary loss that has taken place due to hospitalization.  For eg: Amit is diagonized with Dengue and is hospitalized for four days. The final hospital bill is Rs 35,000/-. Amit pays the amount and subsequently files a claim with the insurance company by submitting the discharge summary, final bills and payment receipts. After requisite checks the insurance company reimburses Rs 35,000/- to Amit thereby making good the financial loss incurred by him. Till the ...