In simple terms, Insurance is planning for uncertainties. We normally plan for certainties of life and ignore uncertainties and unfortunate events.  Insurance is one of the most important financial topics in today’s complex world. Failure to have adequate A insurance coverage is like putting oneself under a Financial burden. Insurance is nothing but a transfer of potential risk to the insurance company at a cost. Nothing will make your business, car, house, family, or self more vulnerable or susceptible to financial strain than a lack of adequate insurance. However, paying too much for insurance premiums can be a financial strain in itself. Hence insurance should be looked at purely as expenses and premium is paid for risk and not forgetting any returns or any maturity benefit. It should benefit you or your family A in case of any A uncertain events.

Many people have a preconceived notion that insurance is just a waste of money, something that is not necessary. This is not true. Almost everyone needs insurance. How do you know? If you own anything that cannot be easily replaced without economic hardship, it should be insured. If your house catches fire, what would you do? If you become disabled at work, would there still be food on the table? Or, in the worst case, would your family be able to main the standard of living  in your absence.? Will your income continue?

These are tough scenarios to imagine, but they happen every day. It is important to understand the consequences and to be prepared for the worst. Some people tend to think of insurance as a luxury, but this is not true at all. Insurance is simply a way to avoid an impoverished state.

Like many things in life, the decision to purchase insurance or not is based on a system of risk/reward. Unfortunately, consumers often look at the reward and ignore the risk altogether. This can impede the process of making an educated decision. For example, the lottery is a very popular system of risk/reward. In this case, the risk is generally small, but the reward can be great, making it a popular choice. Gambling in casinos is another example. In this case, some people become so fixated on the reward that they forget the risk of losing. Think of insurance as an inverted version of the lottery. The reward (not paying for insurance and therefore saving an immediate expenditure) is minuscule compared to the possible risk (losing everything you own and being in debt for the rest of your life). And sadly, the chances of your number coming up in the insurance game are a lot greater than your chances of winning millions.

Hopefully, you now realize that insurance is a necessary part of today’s world. So let move on. There are four questions you should have in mind when you set out to purchase insurance.


What kinds of insurance do I need?

How much of each kind do I need?

Who do I insure from?

How do I get the best deal?

There is also a fifth question that you should continually ask yourself when deciding about your insurance needs.

What happens if I am not covered?

What really happens if you arena covered, whether it’s not enough of a particular type of insurance or none at all? Imagine a scenario and play it out in your head. Will it even affect you? Can you recover from it at all? We will go through some basic scenarios together and you can decide for yourself.



Why you do not need Life Insurance? If you fall under any of the categories mentioned below, you can skip Life Insurance and say goodbye to Life Insurance Agents,

  1. No dependents
  2. Income-generating assets are more than liabilities and commitments
  3. Retired and all responsibilities have been completed
  4. The income of a spouse is sufficient to take care of basic needs, liabilities, and family responsibilities.
  5. Only if you do not fall in any of the above categories, you need Life insurance and work out what should be your adequate life insurance.

Life Insurance is a contract by which you can protect yourself financially against specific losses by paying a premium for a specific term. Since each one of us, during our lives is faced with numerous risks – failing health, accidents, and any eventuality, our instinct drives us to cover ourselves against those risks. Though an insurance cover can’t protect you against the emotional losses arising out of these risks, it softens the economic crisis that usually accompanies these losses. It can partially cover your future value and compensate the dependants to take care of their rest of life. It can help them to pay off the housing loan, car loan any other loan, and maintain the current standard of living, take care of education and marriage expenses of kids.

Simply put, life brings with it many surprises, both pleasant and unpleasant. By taking a Life Insurance Plan one can ensure that he/she is better prepared to face uncertainties in a number of ways and can plan to leave behind a certain guaranteed sum of money at an uncertain time.



  • Undergo medical tests and disclose all the necessary information about health, lifestyle, and current life insurance cover.
  • Keep the nominees informed
  • Pay premiums every year



1. Term Plans

Offer high death benefit at a low premium but no maturity benefit. Premium return policy or premium guarantee plan policy. There are term plans which return back the premium paid at the end of the plan without any returns on the premium.

2. Traditional Plans

Popular and widely accepted products like Endowment, Whole life, Money Back, and Pension plans with/ without guaranteed Maturity benefit fall under the category of Traditional Plans. Periodic payment of a certain percentage of sum assured is made at regular intervals as premium and the Sum Assured is payable at Death/maturity. A Whole Life plan is a permanent insurance plan with a limited payment option and it provides guaranteed death benefit as the insurance is covered till age 100. Premium is higher than the term plan but cheaper than normal endowment plans.

3. Unit Linked Insurance Plans (ULIP)

ULIPs offer a unique combination of security from life insurance and earnings from investments along with various fund options. Like any traditional plan, ULIP also addresses various future financial needs which may come up for an individual, like Child Education, Marriage, any financial goals arising in the Medium-term, Retirement, etc.

General insurance is the insurance of assets, financial assets included. If due to a contingency which is covered under the plan, there is an economic loss, the loss is compensated by general insurance policies.


Top advantages of General Insurance Plans

General insurance plans are beneficial because of the following reasons –

  • The plans cover financial losses and compensate you for the losses that you suffer. As such, general insurance plans provide you financial security even in the case of contingencies.
  • In some cases, general insurance plans are mandatory by law. For instance, motor insurance plans are mandatory as per the Motor Vehicles Act, 1988. Similarly, if you are traveling to Schengen countries, you mandatorily need a valid overseas health insurance plan. When you buy such mandated plans, you fulfill the legal obligation and save yourself from a violation offense
  • General insurance plans help in protecting your savings in emergency situations. You can, therefore, use your savings to fulfill your financial goals
  • Health insurance plans, which are a type of general insurance plan, allow you tax benefits. The premiums paid for such plans are allowed as a deduction under Section 80D. This deduction helps in lowering your taxable income which, in turn, lowers your tax liability and helps you save tax.


Types of General Insurance plans

There are a lot of general insurance plans available in the market. However, the popular and the most important ones are as follows –


Not having a cover for your vehicle is like driving one at night without switching on the headlights. You need to compulsorily take third-party insurance, or third-party liability cover, sometimes also referred to as the ‘act only’ cover, when you buy a vehicle. It is referred to as a ‘third-party’ cover since the beneficiary of the policy is not the two parties involved in the contract — the insured and the insurance company.

It covers the injuries to a third person or damage to the third person’s assets. But, it is better to go for comprehensive motor insurance.

You can negotiate for a discount while buying. Also, soon general insurers would be able to price the premium on the policy wordings.

As a buyer, you will need to understand how the wordings of the policy would affect your premium. Factors like the driver’s age and record, the type of vehicle, and usage could determine the premium in the future. For now, look for lower rates without compromising on any of the clauses or features.

Always remember, to transfer your no-claim bonus to the new car, if you are replacing your old one. This way, you would be able to save 20-50 percent on the first premium of your new car.


  • Talk directly with insurers or brokers while comparing premiums
  • Negotiate on discounts
  • Check if there is the deletion of any clause or benefit
  • Opt for co-payment/deductible to lower premium outgo
  • Make sure the benefit of no-claim bonus is added, if available
  • Receive the original policy certificate/cover note



Accidents don’t just happen on the roads. You may meet with one if you slip in your bathroom, or trip down the staircase in your office, or fail to see the next step in the darkness of a cinema hall.

One careless step could render a double blow to your finances — your healthcare spending increases as you undergo treatment and your income stream gets disrupted until you recuperate. It is here that accident insurance plays a crucial role.

In India, you have two major options to cover the risk of accidents. First, are standalone personal accident insurance policies (PAIP) available with general insurance companies. Second, you can get it as a rider along with a life cover.

Accident policies only cover bodily injuries due to accidents, which are external, violent, and visible, as the definition goes. It covers you for four contingencies that may arise from an accident — death, permanent total disability, permanent partial disability, and temporary total disability.


  • Choose your preferred insurer as premiums are the same across insurers
  • Provide income and professional details to the insurer
  • The insurer determines your risk category
  • Pay the premium based on the risk category
  • Opt for comprehensive cover to include disability
  • Receive a certificate and check its terms and conditions



For most Indians, buying a house is the most cherished dream and probably the biggest investment in life. Home insurance not only covers your dwelling against unpredictable events, such as a terrorist attack or an earthquake but also your valuable personal property, such as consumer durables and jewelry. The premium is less than 1 percent of the actual cost of the contents or structure covered. You can also opt for a long-term cover by paying a lumpsum premium.

In terms of cost, the policy gives you two choices — cover against the present market value and against the reinstatement value, or the value at the time of the claim. Opt for the latter. You can either opt for a standalone Fire Insurance policy (FIP) or a more inclusive Householder Package Policy (HHP).

Fire Insurance Policy only protects the building of your house against fire and allied perils like earthquake, lightning, storm, floods, and riots.

House Holder Package Policy covers the contents of the house against burglary and mechanical or electronic breakdown, in addition to covering the building and contents against fire and other perils. HPP even offers other covers like public liability due to your negligence, personal accident (offers an income stream for the period you are temporarily disabled and a lumpsum payment in the case of death or total disability), workmen’s compensation (covers you against injury or death of your domestic help) and baggage loss.

Remember, it’s never too late to buy insurance. So, if you don’t have the must-have five, buy them now.


  • Choose your preferred insurer
  • Compile a list of belongings
  • Keep handy the purchase bills of high-value items
  • Segregate items according to perils
  • Opt for personal accident cover or other add-ons
  • Receive the policy certificate

With medical costs spiraling out of control and the increase in the shift to lifestyle diseases, healthcare today is at its all-time high in terms of treatment costs. In the event of an unforeseen illness, you may have no option other than to utilize your hard-earned savings, built over your lifetime. Finally, what’s more
important than your health and what better way to protect it than with the right Health Insurance Plan.

A Health Insurance plan ensures complete peace of mind and makes sure that you use your hard-earned savings for the real reasons – Be it your child’s higher education or his dream wedding, a well-deserved family vacation, or just about anything you dreamt of all your life.

For those who have a family, we recommend a family floater instead of a standalone policy since the probability of all family members needing hospitalization at one go is remote.

Even if your employer offers group medical insurance, get your own cover. A change of job or retirement could leave you without health insurance. Getting a fresh cover after 45 is anyway difficult.