BackAsk Mint Money | In plans for children, cover starts after child turns seven
Ask Mint Money | In plans for children, cover starts after child turns seven
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Is there a limit to how much life insurance can one take? Is it a function of the income of the person or he can take any amount that he thinks is fine? Also is there an age limit for taking a life cover?
—Aniruddha
The extent of life cover should depend on your financial needs, income and age. I would suggest you use a financial planning tool to set out your goals and the means to achieve them. You can also seek help from a certified financial planner. The need analysis will give you a clear picture of what kind of money you need to set aside for life insurance based on your need to cover your dependants in your absence or any other life goals that require an insurance product.
I would suggest you start off with a term insurance plan that covers you to the extent of 10-15 times your annual income. I am assuming here a standard profile of a person who is healthy, employed in low to medium risk sectors and is under the age of 35. Usually there are age limits for taking a life cover, which could be in the range of 50-70 years depending on the type of plan. If it is a pure term plan, maximum age at entry could be 65 years. Some companies also offer entry for higher age groups.
I have a one-year-old son. Do I need to take a life insurance policy now or wait till he turns at least 10 years old?
—Rahul Mishra
Children’s plans help you plan your child’s future. These plans also help in securing your child’s future by providing for key milestones in their lives if you are no longer around to take care of them. Children’s plans usually cover the parents’ lives with the child as the beneficiary. There are few plans that offer an entry age of 30 days for a child. However, the risk cover starts only after the child has attained the age of seven (as currently offered in the plans available).
Can I buy a term insurance for my son online? Is term insurance cheaper than other life insurance products in the market?
—Nivedita Sen
You can buy an online term plan for your son provided he is 18 years old. Pure term plans are cheaper compared with other life plans as there is no element of savings and the premium charged is only for the risk cover (death benefit during the term of policy). Online plans are cheaper.
My niece is trying to get the insurance claim after her father’s death. Ideally how much time should a company take to process such a claim?
—Mukesh Singh
The claim settlement process is initiated by a life insurer after it receives intimation from the deceased person’s nominee/family. Once all necessary documents are submitted, most insurance companies are able to process the claim within five-seven working days.
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