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I’m 35 years old. I have a term insurance policy of 80 lakh for a period of 30 years. How should I increase my life insurance cover? Also, is it possible to change the insurer and the term period of my existing life policy?

—Name withheld on request

Term plans are long-term contracts, where premium and coverage is fixed for the duration of the policy. Select plans allow modifications within a predefined set of parameters. To enhance coverage, you need to buy additional term insurance plans. This could be bought from the same insurer or a different one. In case of death, all active term insurance plans need to pay. Term plans do not allow portability. So, you cannot shift the current plan; however, you can buy a new plan and discontinue the existing plan. The only waiting period in a term plan is that of suicide for a year.

I have an endowment life policy with a yearly premium of 30,000 and sum assured of 7 lakh. I’m paying premium since December 2010. Should I continue with the policy?

—Name withheld on request

Endowment plans are of various types and their returns could vary. Most plans load the charges upfront. To decide whether you should surrender this plan, you should compare the current surrender value with the potential maturity value. The difference in these two values is the corpus you would generate from the future premium payable. Calculate the return based on the differential corpus and the future payable premiums. If the expected return is higher than the alternative avenues of investment available to you, then you can keep the plan. Else, you must surrender.

I have taken a life insurance policy and the premium payment is over, but I’m not getting services properly. So is it possible to cancel the agency commission amount by informing Irdai? What should I do?

—Name withheld on request

Agency commissions are paid out in the same year as premium paid. So, commissions on your premium would already have been paid out to the agent. However, if there has been deficiency in services, you can certainly lodge a complaint with the insurer. You should reach out to the designated grievance cell and cite the agency code mentioned on the face of the policy. This would ensure that the firm takes corrective action.

Abhishek Bondia is principal officer and MD, SecureNow.in

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