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Business News/ Money / Personal Finance/  What are the benefits of comprehensive insurance coverage?

What are the benefits of comprehensive insurance coverage?

Comprehensive insurance coverage is essential for financial protection in various areas such as life, auto, and health. It provides a higher level of benefits and protections compared to basic policies.

If a policyholder wants a variety of coverages contained in one policy, they might consider getting comprehensive coverage.Premium
If a policyholder wants a variety of coverages contained in one policy, they might consider getting comprehensive coverage.

Without sufficient insurance coverage, any individual's financial portfolio would be seriously inadequate. It is not only necessary to obtain life or non-life insurance, but the quantity of coverage should be appropriate. When this happens, having comprehensive coverage across many insurance kinds, such as life, auto, and health, is critical.

If significant out-of-pocket expenses are incurred while the patient is hospitalised, even the most basic health insurance or life insurance policy will be ineffective. If a policyholder wants a variety of coverages contained in one policy, they might consider getting comprehensive coverage.

Motor insurance

When it comes to auto insurance, policyholders can select between two types of coverage: own damage and third-party liability. According to the Motor Vehicles Act, all drivers must have insurance that covers third-party damages. These insurances only cover the policyholder's legal duty for injury caused to a third party by the policyholder's vehicle.

Whereas comprehensive coverage provides for damage to the covered vehicle as well as third-party damages. Personal accident insurance can also be purchased with comprehensive coverage, providing an extra layer of protection. Although the whole coverage is slightly more expensive than third-party insurance, it includes a higher variety of benefits and protections.

Both two-wheelers and four-wheelers can benefit from the extensive coverage provided. Comprehensive coverage is usually a good idea because it entitles the policyholder to benefits such as the no-claim bonus (NCB) and a variety of add-on covers such as zero depreciation and roadside assistance.

Health insurance

A comprehensive health insurance plan covers a wide range of medical expenses and protects the entire family under the umbrella of a single insurance policy. There are numerous advantages to having comprehensive health insurance, including cash rewards, value-added services, and additional advantages.

Depending on the type of treatment received, policyholders registered in such policies may be entitled for cashless or reimbursement claims. Teleconsultations with licensed medical specialists, preventive health screenings, financial protection for medical facilities, and zone enhancements are examples of value-added services.

Other advantages include a broad coverage cumulative bonus, which means that policyholders who do not file any claims during the year will have their total insured amount increased without paying any more premiums. Customers who have not made any claims during the year are eligible for this benefit.

A comprehensive plan is one that can be revised on a regular basis. As a result, regardless of policyholders age, they can continue to enjoy the plan's benefits as long as they continue to pay your premiums. If the policyholder obtains coverage for themselves or a member of their family, they get tax benefits under Section 80D of the Income Tax Act.

Life Insurance

Consumers in India can choose from a variety of life insurance policies, including endowment plans, money-back plans, term plans, and ordinary plans. Over the last few years, there has been an increase in the number of people choosing term plans. This is because their rates are lower while still providing a higher level of coverage than the typical plan.

A comprehensive plan, on the other hand, is a type of life insurance that offers advantages in addition to a death benefit or a life cover. In addition, the policyholder is protected by critical illness coverage.

Claims are paid out in two stages: The first when a serious condition is diagnosed and in regular payments to compensate for income loss in addition to death, and the second when the life assured dies. In the event of a serious illness or death, policyholders can choose between a lump sum payment, payments, or a mix of the two.

Even while there are now add-on covers such as critical illness riders that can be acquired in addition to the term plan, having a complete plan can also protect your future financial well-being. This is due to the fact that a comprehensive strategy covers a broader range of possibilities.

Rakesh Goyal is Director, Probus Insurance Broker.

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Published: 09 Sep 2023, 12:04 PM IST
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