Be it your own health or your material possessions like your home, car, jewellery, among other things, protecting yourself and your family against risks is a smart move.
By Subrata Mondal
Imagine a situation when you are driving to the office and meet with an accident or you are out for a wedding with your family, and your house gets burgled. Also, what if you fall sick on an international vacation? The intention of listing out such probabilities is not to make you feel frightened, it is only to help you get prepared for possible uncertainties.
Be it your own health or your material possessions like your home, car, jewellery, among other things, protecting yourself and your family against risks is a smart move. This is where insurance comes into play. Here is a lowdown on important covers you must buy to secure your life and assets.
1. Health Insurance: You should first buy a basic indemnity policy that covers your hospitalization and surgery related expenses. Once you have a basic health policy, it is recommended to buy a Critical Illness Plan, which pays a lump sum amount if a person gets diagnosed with a life threatening illness, such as cancer, bypass surgery, etc. The Critical Illness Plan enables customers to take care of expenses arising due to the illness ensuing expensive treatment. Importantly, while in case of a mediclaim policy you need to submit hospital bills at the time of making claims, critical illness plan pays the entire sum insured on diagnosis without the need of submitting hospital bills. Buy these two policies for complete health protection of you and your family.
2. Motor insurance: Motor insurance is another must-have cover if you own a vehicle. It is mandatory under the law that any vehicle that plies on Indian roads should be covered by a third party liability insurance. Under the new Motor Vehicles Act, there is a penalty of Rs2,000 if the person is found driving without an insurance cover and Rs4,000 for a repeat offence.
Since most of the Indian roads are narrow and highways are prone to accidents, chances of scratch or dents are more. Therefore, own damage cover is also important to buy. You should buy a comprehensive cover which protects you not only from third party liabilities but also from own damage.
3. Personal Accident Policy: A personal accident cover is another must have policy as it reduces financial constraints in case of accidents by compensating for loss of income due to disability or death. Moreover, it is a low cost policy and is easier to purchase.
It is important to note that personal accident insurance is often bundled with several credit cards or other financial instrument but it may have restricted coverage. Therefore, it is recommended to buy a standalone policy or as a rider along with your health insurance policy.
4. Home and Asset Insurance: Home is one of the most valued possessions for a person but still an insurance cover for this prized possession is more often ignored. One should consider buying a home insurance policy as it safeguards the house and its contents against natural as well as manmade disasters, including fire, burglary, flood, earthquake, among other things.
Interestingly, a home insurance policy protects not just your house and its contents but offer more coverage than that. For example, the home insurance plan can also protect your personal belongings too, like electronics or jewellery in the house. If you want comprehensive coverage for personal belongings like jewellery then there are standalone products too in the market at an affordable price. For example, few insurance companies now provide a comprehensive coverage only for valuables kept in your bank locker at a very affordable rates.
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5. Travel Insurance: Buying travel insurance has also become a common practice these days, especially when one is travelling out of the country. It is important because if you fall ill while travelling, the cost of trip could multiply many times. Not only it covers medical emergencies but non-health related situations as well, like the loss of passport or baggage, delay in flight, etc.
Today, our lives include numerous spheres and elements. This is a fact that not only enriches our lives but also leaves us open to several kinds of risks. The best idea here is to be well-prepared to face those risks by ensuring that you are covered for all types of contingencies.
(The author is Executive Vice President, IFFCO Tokio General Insurance)