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Ask Mint | Know your insurance plan in its entirety, read documents well

Ask Mint | Know your insurance plan in its entirety, read documents well
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First Published: Mon, Jan 12 2009. 01 12 AM IST

Updated: Mon, Jan 12 2009. 01 12 AM IST
The insurance business in India isn’t just growing, but also becoming more sophisticated in terms of product offerings. To help readers keep ahead of developments in this business, Mint features a Q&A on insurance every Monday.
I am a 35-year-old man with a monthly income of about Rs40,000. I have already invested in a term plan and now I intend to make provision for my three-year-old child. What is the best option?
You can opt for specific children insurance plans to save money for children’s education and marriage. The benefits under these policies are designed to guarantee targeted savings for the child. So, where conventional forms of savings work only as long as the parent is alive and well, a typical child plan continues the savings plan even in the event of the parent’s death or disability. This ensures that you construct a fail-safe plan for your little stars’ future and help them shine the brightest.
These plans allow withdrawals which coincide with the requirements of the children at different stages of life, be it education, profession or marriage, among others. There are options under children insurance plans in the market to insure the life of the parent or that of the child. It is advisable to take the option with the life of the parent insured as it can make the child the beneficiary and hence provide protection during the child's growing years. A good child plan can be a vehicle to ensure a smooth, guaranteed and risk-free financial future for your little star.
I am 33 and am planning to buy a life insurance plan. How can I add to my insurance against an accident or a fatal mishap?
Most companies will offer riders on your base policy which provide additional protection to the insured in case of an accidental death or disability arising due to accident-related mishaps. Riders are flexible options that provide additional protection to a customer which helps him plan his life insurance needs more effectively. They allow customization of a life insurance policy to suit the specific needs of customers. Thus, you can opt for a personal accident benefit rider that is a low-cost additional benefit that is paid to the nominee in case the insured’s death is caused by an accident. It is very important to always read sales brochures and the policy document so that you are aware of the plan in its entirety.
Readers are welcome to write in with their queries to askmint@livemint.com. The questions will be answered by senior executives from leading insurance firms.
This week’s expert is Rajesh Relan, managing director, MetLife.
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First Published: Mon, Jan 12 2009. 01 12 AM IST