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  1. Life Insurance: Term plan can be bought only by an earning individual

Life Insurance: Term plan can be bought only by an earning individual

A term plan is issued to a person who is earning. Both the proposer of the policy and the life to be insured has to be the same person.

By: | Published: July 10, 2018 2:38 AM
term plan, unit linked insurance, charges of Ulip,  Aditya Birla Capital,  Irdai norms The charges in Ulip vary from product to product and depend on age and gender.

Pankaj Razdan

Can I buy a term plan for my 19-year-old son?
—Lohit Sunder

A term plan is issued to a person who is earning. Both the proposer of the policy and the life to be insured has to be the same person. Hence, if your son is working and can provide an income proof he will be able to purchase a term plan for himself. You can guide him to opt for the appropriate plan. In case he is not earning, for now you can make him a nominee in your term plan.

How much does one pay as charges in unit-linked insurance (Ulip) and does it help in creating long-term wealth?
—Dhiman Ghosh

The charges in Ulip vary from product to product and depend on age and gender. Broadly, there are four categories of charges—premium allocation charge, policy administration charges, mortality charges and funs management charges. An Ulip is amongst one of the popular investment choices for long-term wealth creation. It also offers life insurance cover and tax free returns.

How can I change the nomination in my insurance policy?
—Ayush Kumar

You can visit the nearest branch of your insurance provider or connect with them through email and give a written request for changing the nomination along with the reasons and the same will be done.

I got a term plan but cancelled it within 3 days of issue date. The insurer deducted Rs 6,570, saying it is for medical expenses and stamp duty. Also, it said there is no provision to provide any receipt/invoice for this. Can insurers really do this?
—Gajendra Yadav

In case an insurance policy is cancelled within the free-look period, the firm deducts proportionate risk premium for the period of cover and expenses incurred by it on the customer’s medical tests and the stamp duty charges incurred while issuing your policy as per Irdai norms. stamp duty is a percentage of the sum assured and is paid to the government. Fee paid to the medical centre for tests is not refundable, given the medical tests are completed and the reports have been generated. This information is mentioned in your policy contract and the deductions should be in accordance to the same.

The writer is MD & CEO, Aditya Birla Sun Life Insurance and Dy. CEO, Aditya Birla Capital. Send your queries to fepersonal finance@expressindia.com

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