Category Archives: Insurance

A home is a place where one loves to live in. A home is something which is special to everyone on us. It is a place where one feels super comfortable. No money is better spent than what is invested in your home. Your home is one of the biggest and powerful investments that you would make it in your life and it is a bit natural that you would protect it. This is where the householder’s insurance will help you. They are like the angels that come from above to protect your shelter space. Thus, safeguarding your house from the unforced events becomes a priority and the best way through which it can be done is by securing the home with a Home Insurance.

A home insurance or Householder’s insurance is commonly defined as a type of Property Insurance that covers Private Homes security from different natural and unnatural cases like theft and robbery, fire attack damages of houses due to natural disasters like earth quake, cyclone etc.

Home Insurance

It is a type of investment that you make for protecting your house from disasters and other causes. Insurance is meant to come in rescue in these types of calamity. It is a type of insurance policy that combines a variety of policies and liabilities that protects the houses.

Most of the home insurance policies include four essential types of coverage

1. Coverage for the structure for your house
2. Coverage for your personal belongings
3. Liability Protection
4. Additional living expenses if you are temporarily unable to live in your home because of an insured disaster.

The Structure of Your House

This type of policy helps to pay you to repair or reconstruct your home if it is damaged by fire, lightning, hurricane and other disasters listed in your policy. This policy will not pay for the damages like the earthquake, flood, disaster or routine wear, and tear.

When you purchase the structure of your House policy, make sure that you study the guidelines carefully. Make sure that you purchase enough of coverage to rebuild or reconstruct your home.

Some of the policies also cover the detached structures such as the garage, tool shed etc. This includes about 10 percent of the insurance on a home structure insurance policy.

Coverage for Your Personal Belongings

This policy covers up different products such as -furniture, clothes, sports items, utensils and other personal items that are destroyed or damaged by different insured disasters like fire, lightning, hurricanes etc. which are listed in your policy. This policy covers up around 50-70 percent of the insurance of the structure of the home. The best way to know that whether your policy envelops enough of coverage of home structure is to conduct a Home Inventory.

A home inventory ensures that homeowners are sufficiently prepared, in terms of their insurance coverage and deal with the potential Losses. A detailed list of all the items that are destroyed, damaged or stolen is required for an insurance claim. Proper paper documentation work ensures a faster and smoother claim process.

Insurance Institute of India offers a Home Inventory tool that lets you create, maintain a photo home inventory which you can save it in the cloud safely.

The personal coverage loans include the items stored off premises- this means that you are covered anywhere in the world. Some of the companies limit the amount to 10 percent of the amount of the insurance.

The Liability Protection Coverage Plan

This type of coverage insurance plan helps you to protect you and your family member is responsible for hurting or damaging someone else’s property. Like for an example- if someone slips from the staircase in your home and is injured, then the liability insurance can help you by providing with legal defense fees and in the event of settlement or judgment and can pay damages up to your coverage limit.

The liability coverage also pays for the damages caused by the pets. So if your son/daughter or your dog damages any property of your neighbor then you are covered.

Additional Living Expenses

This policy pays you additional costs of living away from home if you cannot live their due to certain damages caused by the natural and unnatural disasters. It includes your hotel bills, restaurant meals, and other usual living expenses. This coverage policy has certain limits like time limitation. You also have an option to increase the amount of ALE Coverage for an additional premium. This coverage insurance plan is different to that of the plans for the structure of the home. If you are renting a home, then the ALE Plan covers you for the rent that you have collected from your tenant if your home had not been destroyed.

Benefits of Home Insurance

The top most benefits of Home Insurance are

• Financial Protection– The Homeowners Insurance Policy provides money to rebuild or reconstruct your home if your house has suffered from any sort of disaster or to replace any lost property.
• Timely Recovery– The Home Insurance Policy helps the family to go through the rebuilding process quickly and help them to move on in their life. It also benefits families having psychological health, reducing stress and feeling loss.
• You can get a good policy at a low monthly premium rate.
• The Home Insurance policies can cut down your stress and tension level.

How to Choose a Home Insurance Plan Based on Your Requirements

There are different types of Home Insurance Plans available at various different prices and customised plans and offers and as per the individual needs. Below mentioned are some of the techniques that will ease down the method of choosing an insurance plan-

Check Premium and Coverage

At first, calculate a number of risks that your house faces or may about to face in the future. Like for an example- if you are staying near to the flood-prone area then you should ensure that your home insurance policy is covering these risks. Always check that whether your insurance policy plan fits in the shoes of the budget. You can also compare the premium policy plans as per your need.

Check claim settlement Ratio

A good company is surrounded by the time settling claims. The purpose of insurance might get deflated when you do not claim when it is required. Therefore, it is necessary to check the Claim settling record of the Companies before making an investment.

Company’s Reputation

Before making an investment on any insurance plan do check the repo and the background of the company. Make sure that whether they have the offers and plans based on your need or not.

Covered Perils Offered by the Home Insurance Companies

The Home Insurance Policy offers coverage on the “Named Perils” and “Open Perils” basis. The named perils provide coverage for the loss that is mentioned on the list of policy. If it is not listed then it’s not covered. Whereas, the Open Perils provides coverage for all the losses except for those that are excluded specifically from the policy.

Some of them are as follows

Basic-Form covered Perils

These are the least comprehensive coverage plan. This provides the protection against the perils which is likely to get a result of total loss. If something happens to your home that’s not on the list below then you are not covered. The basic formed Perils include:

• Fire
• Lightning
• Windstorm or Hail
• Explosion
• Smoke
• Vandalism
• Aircraft or Vehicle Collision
• Riot

Broad “Named Perils”

This includes the Basic form perils as well as other 6 additional covered perils. This is a named peril policy. This peril form is designed to cover most of the damaged caused to the property. The different types of Perils are-

• All basic form perils
• Burglary, Break-in damage
• falling objects (Breaking of tree branch)
• Weight of Ice and Snow
• Freezing and Plumbing
• Accidental Water Damage
• Artificial generated electricity

Special “all risk” Perils

These is the most inclusive form than the other two forms of perils. This policy covers all types of losses unless specifically excluded. The Special “all-risk” perils that are excluded-

• Ordinance of Law
• Earthquake
• Flood
• Power Failure
• Neglect War
• Nuclear Hazards etc.

For many homeowners, an Insurance is just a piece of paper that is signed and filed away. Home owner’s insurance is financial covenant, but it should also be treated as a living, breathing entity to be nurtured over time. Only by reading the policy carefully and considering a right agent and knowing about your coverage limits and choosing the offer plans and updating a Home Inventory can ensure your hard-earned money will keep that roof over your head strong and intact.

Term insurance is a type of insurance that is available for a defined period of time (number of years). The only difference between a term insurance policy and other policies is that a term insurance policy is comparatively economical as it does not have any cash value. The policy is applicable only if the insured dies within the timeframe during which the term insurance policy is in force.

Various insurance providers are offering a term insurance policy that comes for various terms such as 10 years, 20 years, 30 years etc. The term insurance policy also has a built-in feature where it can get converted to permanent life insurance policies irrespective of the state of the health of the policyholder.

In case of the event death of the policyholder during the term of the policy, the beneficiaries can claim death benefits from the insurance company. And the beneficiary or nominee can be a family member.  To know more about various Insurance Policies in India – Click Here  Best Online Term Plans in India

Insurance companies offers online term insurance plans keeping the convenience of customers in mind. We have listed out some of the benefits of buying term insurance online:

• Buying term insurance online is more beneficial as one can benefit from lower policy cost as compared to buying it in traditional ways. From the insurer’s point of view, the involvement of life insurance agents and field officers, for online sales are limited. Hence, the insurance company passes on this benefit to the customer.
• Also, online process is the most convenient as one can operate from the convenience of their home and the application process also happens in a hassle-free manner.
• As the customers are purchasing the term insurance online, they are saved from the manipulation of the insurance agent or advisor.
• Irrespective of the way the customer chooses for purchasing the term plan, the customers are serviced in the same manner.
• In addition, online plans have low premiums such as
• There is no mediator in the deal
• The online buyer is considered to be a low – risk customers for the insurance company. The customers are expected to be educated, earning well, and is likely to have health insurance. In the event of an emergency, the customers would be in a position to reach a hospital on time and get access to quality medical facilities. These factors contribute towards the low risk and reduction premium.

Why should you buy Term Insurance?

Getting a Term Insurance is profitable as you can secure your family’s future and save them from the crisis by financially securing them through a term plan. In case of an event of a death of the policyholder occurs, the family of the insurer will get a lump sum amount as a death benefit which can bring financial stability to your family and pay off the liabilities.

Things to ponder over while buying online Term Insurance

Your online price quote depends on the basis of an assumption that the applicant carries normal risk in terms of health, occupation, and your family’s medical history. Once you have provided all the required documents, you may have to undergo a medical check – up to arrive at the actual policy cost. In case your medical test indicates that you are exposed to a certain risk, the premium for your insurance may arise.

The Internet has revolutionized our way of living and buying an online insurance plan is indeed a smart move. However, one should be careful and avoid policy lapse which can occur by missing premium payments as there will be no insurance agent to remind you of your premium payment due date. Another way to avoid the date of your premium payment is that you can send ECS (Electronic Clearing Service) mandate to your bank so that the premium amount is automatically deducted on the due date. Besides that you can also set up an alert on your mobile phone or computer is also a great way to remind yourself of the payment date.

Also, your insurance premium will be 25% to 30% higher if you are a smoker or use tobacco in any other form compared to people who does not use tobacco. Hence, make sure to mention this information in your application for insurance as at the time of the claim, if the insurer finds that the customer had concealed the information, the claim will be rejected. The insurer may also cancel the policy, as applicable.

Let us look at the table below where we have listed out the Term Insurance plans in India:

Features of Term Life Insurance Plans

Term Insurance Plan is designed in a way to secure your family’s core financial needs at the uncertain events such as death. In this scheme, the beneficiaries such as family / dependents of the life insured will get lump sum amount in case of death or critical illness. Such insurance plan can help your family to have a sound financial independence, even if you are not around.

Read below to know some of the key features of Term Life Insurance Plans:

• Term Life Plan comes with excellent tax benefits. Under the scheme, one can avail profitable tax benefits under section 80 C. Also, the premiums paid the premiums paid for the Critical Illness Benefit also qualify for a deduction under section 80 D.

• The minimum policy term of Life Term Plan is of 5 years and the maximum is of 25 years to whole life span for equated monthly premium payments. For single premium payment policies, the policy term is 5 to 15 years. One can opt for the term plan period they think works for them. Experts suggest that one should go for long term plan as the premium amount generally gets locked and the insured party gets to pay the same premium over the tenure of the term plan for the same amount of cover.
• One can also choose the payment options according to their convenience as Term Insurance policies offers flexible premium payment options. Where premiums can be limited pay, single pay or regular pay plans. And the subscriber who chooses limited or regular pay plans can pay their premium plans either monthly, quarterly, half – yearly or annually.
• The subscribers also get a choice to opt for the kind of plan they wish to take as per their convenience. They can choose either single or joint life plans as per their need. They can thus choose to extend coverage for dependent spouses or choose a plan exclusively for the breadwinner of the family.
• On the event of the death of the policyholder during the policy term, the beneficiary will receive the amount chosen at the time of choosing the policy. And the amount that the beneficiary would receive depends on the term plan, with the amount increasing, decreasing or remaining the same irrespective of at what point of time of the policy, the policy holder’s death occurs.
• There are insurers who design plans in a way that they can offer survival benefits in the form of premium refunds on maturity, whereas a regular term insurance plan does not have any survival benefits.
• Also, upon maturity of the policy, surviving policy holder stand to receive benefits under a TROP (return the premium paid by the insured person over the tenure of the plan) policy only. And in case of a TROP policy, the policyholder will receive the premium amount paid over the policy tenure as one lump sum.
• Any interested policy holder can also opt for add – on features to their regular term insurance policy. And these add – on plans will push up the price of the premium being paid but provide additional benefits in case of accidental death, critical illness, total and permanent disability benefit etc.

How to choose a Term Insurance Plan

There are many options in front of an interested person, with different policy terms, benefits and sum assured amounts. To make the decision making easier, we have listed out some important points that you should keep in mind when looking for a term insurance plan:

• Make sure to check the reputation of the insurance company before picking an insurance policy. It is important to check the FICO score as a term insurance policy is a long-term investment.
• One of the important factors before choosing a term insurance policy is the amount you would be paying in terms of a premium for the protection offered.
• Inflation is another factor one should keep in mind before choosing a Term Insurance Plan. Term Insurance Policies are usually taken for 10 – 20 years, during which time inflation will grind down the value of the rupee, which will result into lower returns at the time of maturity. To offset this, consider companies that offer plans where the cover increases by 5% to 10% annually to keep in line with inflation.
• Also, make sure to compare policies online so that you can be clear of the plan you want to proceed with. The comparing facility is offered by the third – party financial websites, which are also free of cost.
• In case you are unable to choose the best policy for yourself, it is advisable to seek advice from an insurance advisor. This way you can pick up the right policy for yourself.
• The most important part of choosing the right policy for you is to read the terms and conditions properly before making a decision.

Documents Required for Term Insurance

Every insurance company ask for some documents at the time of applying for term insurance. Following is the list of documents you are required to provide when taking a term insurance plan.

• PAN (Permanent Account Number) card
• Proof of identity using documents like passport, Voter ID card, Aadhaar card, driving license, letter from a public servant or authority verifying identity.
• Proof of address with documents like utility bills (electricity, telephone) ration card, bank account statement, voter ID card or passport
• Proof of income with documents like Income tax returns, employer’s certificate, or Income Tax assessment order.
• Some recently clicked passport size photograph.

Eligibility Criteria for Term Insurance

Before taking up a Term Insurance policy, interested people are required to meet certain eligibility criteria which are as follows:

• To take the plan the policyholders are required to have attained 18 years or above that
• The maximum entry age will depend on the minimum tenure of the policy
• The maximum age at the time of maturity for these policies can be 75 years but this could change from one insurer to the next
• The minimum age for maturity will be determined based on the minimum age at entry and the minimum tenure offered
• The sum assured will also be a factor in calculating the eligibility as many policies have a fixed minimum sum assured
• This may not be mandatory; however, some insurer may ask you to undergo a medical checkup before taking up the policy.