Group Life Insurance Policy: Because employees are meant to stay forever

You can arrest your company’s high employee attrition rate with a humane gesture: get group insurance for your staff.

India is fast developing into a start-up destination for the world. Stories of people quitting successful corporate careers to launch their own companies are frequently heard of these days. The drive to internalise your dream and launch it via an enterprise is a rare quality, but many people in the country seemingly possess it!

But while many of these start-ups are able to get off the ground and do well after a while, many more are biting the dust. The biggest problems that plague new businesses involve not enough revenues to pay high salaries, and staff attrition. Many youngsters who work in start-ups do so because they want to gain some experience before they venture into bigger companies. But there are many who are always on the lookout for a higher salary and good benefits so that they can stay on at the company.

Many new companies struggle with staff attrition. Good talent is hard to come by at lower pay, and even more difficult to retain. It is also not possible to offer the kind of employee benefits that bigger corporations do. However, as a business owner, you can quite easily offer one important employee benefit: a group life insurance policy.

What is group life insurance?

As the name suggests, it is a life insurance policy by which a group of people is covered under one term life insurance plan. This group is often a group of people working in the same company. Unlike an individual life insurance plan, the group life insurance policy extends the benefits of a high sum assured amount for all the members covered under the plan.

Employees receiving the benefit of a group life insurance policy are less likely to quit the company to work elsewhere. Knowing that their company can protect their loved ones’ interests in their absence is a powerful motivator to work long and hard for the business! Businesses that offer employee group life insurance find that staff attrition rates are lower and employees are more inspired to give their best for the company.

How does it work?

As the business owner, you pay the premiums towards the group insurance plan. In case of the unfortunate demise of any of the group members while they are still employed with the company, the plan’s benefits pass on to the deceased’s family members. The policy is just a single master policy issued in the name of the employee to which new names may be added periodically.
The coverage is ceased the moment the employee leaves the company or passes away.

Mistakes to avoid while buying term insurance

As the name suggests a Term Insurance plan is a kind of insurance plan that is designed to cover for a particular period. This insurance plan also provides you with the benefit on the death of the insured over the total sum assured in the insurance. It is very tactical to purchase the best term plan to get the maximum benefit of what you have invested in the plan. 

Nobody wishes to lose their hard earned money so easily and that is why you need to be extra careful while selecting a term plan for your requirement. Here are some common mistakes that people do while selecting a term plan for themselves. Knowing and avoiding them would help you get the most returns on what you insure.

Buying insufficient cover: the main motive behind the purchase of a term plan is that even something happens to the policyholder in between; the family should not suffer the consequences and lead a comfortable life even after him. If the sum assured you opt for is inappropriate then it becomes hard to meet the needs when it is most required and the purpose fails. The sum insured in a term plan must be at least 10 times of the annual income of the policy holder.

Procrastinating: It is advisable to buy insurance when you are young and healthy since by doing this you get the best opportunity to cover all of the unforeseen risks pertaining to the life. You should not procrastinate with term insurance as with the increasing age the premium of the plans also increase.

Taking shorter term plans: A very common problem that most policyholders do is that in order to save money most of us tend to purchase term plans with shorter terms and result in inappropriate coverage by cheap plans with lesser premiums and so. A lengthy term plan is beneficial in terms of covering higher risks that too for a longer time period.

Inappropriate information: another most common mistake that most of the policyholders face while finalizing a term plan is inappropriate disclosures. If you have insufficient and incorrect information about where you are investing your money then It is very likely to land into the financial loss in different ways.

Excessive riders: Sometimes extra riders are beneficial but in most cases, excessive riders in a term plan may act as boomerang in terms of financial benefits. Excessive riders prove to be highly expensive in most cases without even offering the basic return to the policyholders.

Not comparing insurance companies: With the advancement of time, various new options in the field of term insurance has also come up with numerous benefits as well. Most of the insurance buyers tend to buy policies from only those companies who they know for some time. This could also land them into a financial loss as they missed out to compare with other term facilities and coverage that other companies are offering in the world of competition.

 
These mistakes may appear very silly but they are highly expensive when your hard earned money is at stake. So, better try avoiding these mistakes to get the most out of what you insure.

Health Insurance: Another way to stay healthy

Daily exercise, a balanced diet and health insurance: the 3 things you need to remain fit and healthy always.

Most of us today realise that being fit and healthy can increase our longevity and quality of life. But fitness is not just about joining the gym and consuming healthy salads and protein smoothies – it is also about maintaining fiscal health so that one may be able to combat the high costs of treatment and medication if one falls ill.

So apart from exercising daily and eating balanced meals, it is important to have a good health insurance policy to remain both physically and fiscally fit. The importance of health coverage cannot be emphasised enough – in times of rising inflation and high treatment costs, a good health policy can keep you and your loved ones protected from the financial repercussions of illness and associated treatment.

The best policies in India offer the following 3 health insurance benefits:

1. They pay for hospitalisation and treatment. The most important benefit of health insurance is that it pays the high costs of diagnosis, hospitalisation and treatment. Medical care is quite expensive in India, and just a single hospital visit can set you back by thousands of Rupees. It may take years to rebuild your savings after you have spent it on health care. But the best health policy can pay for diagnosis of serious diseases, hospitalisation costs and also post-operative treatment. 
2. It provides access to quality healthcare. Instead of deferring an urgent surgery to later, for want of funds at that point in time, your health insurance policy provides immediate access to quality healthcare. Choose a health plan that lets you choose your preferred health care provider at a facility of your choice, apart from quick admittance and discharge procedures, online record of your treatment plan, and fast tracked doctors’ appointments. 
3. It has your back at all times. You can get considerable peace of mind from buying a health plan that thinks of everything. It is important to choose a health policy that not only provides sufficient coverage, but also incentivises the maintenance of good health. In the digital age, it helps to have your health insurance working 24/7 to stay connected with you over the Internet – the best health plans today offer online access to health tips, provide you with an accurate analysis of your heart health and other vital parameters, and reward you for adopting a healthy lifestyle. And all of this, with the benefit of safeguarding you and your loved ones in times of illness.

Tips to buy best life insurance policy with high returns

Is life insurance something that every breadwinner should consider? Why is life insurance important? The answer to these questions is certainly yes, life insurance is crucial for everyone who is concerned about his/her family’s financial state or want to provide financial security to loved ones after retirement. Financial planning is essential to take care of yourself and your family. 

Even when you are watching television, you will come across numerous commercials for life insurance policies. The majority of people understands the importance of life insurance and wants to purchase one; however, many people are not aware where to begin or find the policy. There is also a misconception that probably insurance can’t be affordable for them anyway. However, with various companies offering different policies, benefits, and rates, you can find most plans are affordable and suit your needs.

A life insurance policy helps cover the risk of unexpected eventualities, by securing your family in the event of your death. Furthermore, it also helps secure your retirement by providing a source of income for you in non-earning years.

If you are interested in buying a policy that will suit your needs yet you will get the maximum returns, then here are some tips for you.

A little research will help you understand the basics of the different type of policies and how to work out how much of an insurance policy cover you may need are the most important aspects of purchasing a life insurance policy. A broad range of policies is available on the market, ranging from pension plans, term, whole life, money back policies to endowment insurance and ULIPs. So, finding the right policy type with the coverage that is best suited for you is a slightly daunting task. 

With the advent of the internet, it has become very easy to buy any insurance at the comfort of your home or office. You will also get various details about different policies online. It is every easy to search various insurance companies and different types of schemes and then you can easily compare various insurance policy quotes. This comparison will help you find the plan that most suits your needs and budget; thus saving your time, money and efforts as well. 

It is also essential to understand that different factors affect your premium rates such as your age, health, and habits. Things like smoking, obesity, drinking, etc. may cause you to pay higher premium whereas healthier people need to pay lower premiums. Furthermore, starting at an early age also helps reduce your premium with maximum life cover.  

This helps you get access to some of the best policies and get high returns. All in all, with a little research and by keeping a few things in mind, you can easily find the right policy suited to you.

So, what are you waiting for? Start your search on your laptop/mobile and get ready to find the best one with high returns, now.

Buy term insurance online now in few steps!

Relax, sit back, and buy term insurance – it’s really that quick and easy!

Ever since the advent of the Internet in our country, every behaviour that we identified as ‘typically Indian’ has changed dramatically. We no longer wait in long lines at the bank. We get our groceries delivered online instead of haggling with the local grocer. We pay for taxi rides using online payment platforms. And we also buy insurance online, after getting all the information on it, also online!

Insurance and banking sectors have dramatically changed the way they do business in the country. No longer are both sectors identified with several reams of paperwork and endless rounds to get the slightest job done. Today, a large amount of autonomy has arrived in terms of customer interactivity with insurance companies. Thus, there is no need to even hire an insurance broker. Customers can select their preferred insurance provider, find out all the relevant information about a plan and proceed to purchase it online.

The best insurance providers in the country give customers the chance to buy term insurance online. You may not even require to take a medical test to complete the process. Buying term insurance online is simply as easy as clicking 1-2-3 on your laptop or mobile phone.

If you wish to buy a term plan, you can follow these steps.

Step 1: Calculate the sum assured you may need. This amount must account for all future expenses and also factor in inflation and higher living costs of the future. Write down all the future expenses that you anticipate, and multiply it by 10. The number you arrive at is the sum assured that you must seek from the plan.
Step 2: Browse for suitable plans online. Be sure to pick the most reputed insurance provider and glance through their term plans.
Step 3: Use the insurance provider’s term insurance premium calculator. To use it, you must enter the figures for sum assured, age, marital status, annual income, and tenure. The calculator then shows the premium payable figure. The premiums for term plans are quite affordable, despite the high sum assured amount.
Step 4: You can now fill out an application form. The form is quite simple to fill out and you can proceed to the next stage, i.e. paying for the plan using Netbanking or your Debit/Credit card. That’s it – you have finished buying term insurance online!

What is the best time to buy life insurance for yourself and your family?

While returning back from office today, I got a call from Mithu, my 4year old daughter requesting me to get few stuff for her. While I was busy talking to her over mobile a car swept past me and missed hitting me just by an inch. I was held aback. Standing in the middle of the road my hands began to tremble and all I could think of was my family and my little daughter Mithu who was desperately waiting for me to return home. 

Various thoughts began to cross my mind. The only thing I could think of was what would have happened if I had been hit by that car or had been left physically disabled or dead post the accident. Who would have taken care of my family? Being the sole earning member of my family, I was scared about the security of my family. And this very fear got me thinking about the nine letter word ‘Insurance’ which has been by and large ignored by me till date. 

Suddenly I remembered having read recently that the frequency of traffic collisions in India is amongst highest in the world. Every year more than 135,000 traffic collision related deaths are reported in India (Source: National Crime Records Bureau, India)

 

All my life I and my friends ridiculed insurance agents. We ignored their calls stating that we were not prepared to buy an insurance plan at the moment.   But this incident made me realize my mistake and I immediately contacted my friend who works with a well-known life insurance company. He then explained to me the various types of Life Insurance plans and advised me on the one suitable for me.

Did you know that even though the Indian Life Insurance sector is biggest in the world with about 360 million policies and expected to grow at 12-15% over the next 5 years, the penetration of Life Insurance compared to our huge population is only around 3.4% only at the end of the financial year 2015-16! According to the last Swiss Re’s last sigma report the penetration was only 3.30% in 2014-15. With the expected growth rate as mentioned above, the penetration will still be at 5% level only by 2020.

Insurance aversion is a common phenomenon. While some lack the basic knowledge, others do not know how and what to buy. What about you? Do you know why and when you need insurance? 

We have heard, one must enjoy life and live it to the fullest! But what we do not hear or realize is that along with the enjoyment of life also comes are the various responsibilities and uncertainties. Responsibilities towards your loved ones come in various forms and uncertainties do not come after giving a notice. 

Let us see what our main responsibilities are -

1. Towards our Parents - When they grow old and are no more in a position to earn, it is our responsibility to look after their daily needs, health and other overall well being.
2. Towards our Spouse - Once we are married and our spouse is not working, it is our responsibility to look after his/ her financial needs.
3. Towards our children - Once they are born, right from their childhood to schooling and higher education and till they are settled in their respective lives, it is our responsibility to look after them.

Uncertainties just like responsibilities also come in various forms and without any notice. These uncertainties lead to disruption in our normal day to day life and thus leading to disablement in fulfilling our responsibilities. In such situations, how do we expect to meet the financial needs of our family? Who will take care of the lifestyle they have been used to? The education of children and financial need of our spouses and so on. 

But do not worry -There is a solution to every problem and so does this problem have a solution. The solution to this problem is what we call ‘LIFE INSURANCE’. 

Yes, life insurance can help you ensure financial security for yourself and your loved ones. But do you know when to buy a life insurance policy?

Anybody can purchase any Life insurance policy whenever he/she wishes to. But only purchasing a policy is not the right solution to this problem. Purchasing the right kind of policy at the right time depending upon your need is the ultimate solution to all problems.

For example: A Life Insurance Child Plan can be purchased once a child is born, but a term plan cannot be purchased when one is very old. Similarly, a child plan cannot be bought before the birth of the child, but an endowment plan can be purchased immediately after one begins to earn.

Let us understand that when it is the right time to buy an insurance policy by following the various life stages of Santosh Kumar, an IT professional.

1. Young and Unmarried

Santosh a young IT professional has just passed out of college and has joined a leading IT company in Bangalore. He has no responsibilities on his shoulders as his parents are still earning. He is very happy with his starting monthly salary of Rs 65,000. During one of his candid conversations with me, he told me about his dream of retiring from his job and owning a farm house at age 55. He further added that he would like to spend his retirement life farming and growing vegetables in his quiet space. 

Impressed by his thought, but with a doubt in my mind I asked him who does he plan to fulfill his dream. I asked as I knew, he spent major part of his salary towards shopping, going to the best restaurants and buying the latest gadgets. 

He was clueless and confused and it was then that I explained him the benefits of an Endowment Insurance Plan.  An endowment plan provides life insurance benefits along with an assured amount to be returned to the investor on maturity of the plan period. Endowment plan help an individual to plan for his future expenses. Just by investing a small amount from his starting salary Santosh can be rest assured of getting a decent lump sum amount for his future needs. Endowment plans should be purchased at an early age when an individual is free of huge responsibilities and can allocate fund for future needs. The other advantage of starting early is that cost of premium will be less. 

2. Married

Now, that Santosh is well settled in his job, his parents decided to get him married. He is now happily married and his spouse stays at home and looks after the family. It is a well balanced family where one earns and the other takes care of rest of the things in day to day life. 

Since death is uncertain, what if something happens to Santosh and he dies? Who will take care of his wife for rest of her life? The answer to this question lies in a Life Insurance Term Plan. Term Insurance Plans aim at providing financial security to the individual’s family or the nominee in case of untimely or premature death of the policy holder. The policy buyer is required to pay certain premium at regular intervals. Term Insurance Plans usually do not assure any returns at the expiry of the term period. By investing a small amount in a term plan at this stage of his life, Santosh can ensure that his wife is financially secured and able to maintain the same standard of living in case of his premature death.

3. Childbirth

Santosh and his wife are expecting a baby soon. All are very happy. But raising a baby also means that the expenses start right form childbirth to vaccinations, schooling, higher education and then wedding. Fund is required at every stage of child’s life. Then how will Santosh manage to meet these expenses in his absence? How will he make sure that his child gets the best of all even if Santosh is not around? 

Well, a Life Insurance Child Plan is what he needs at this phase of his life. Child plans are insurance plans whereby, the benefits of the plan are passed to the child or the nominee in the event of untimely death of the plan buyer. A child plan secures the future of the child in case of untimely death of his parents. The plan continues even after the death of the parent and no premiums need to be paid but future benefits are paid by the Insurance Company.

4.Middle Age

Santosh has now secured the future of his family by investing in various insurance plans. Now he realizes that he has certain part of his salary which he may easily afford to invest in some other Insurance plans in order to ensure wealth creation for himself. Santosh can now choose to invest in Unit Linked Insurance Plans or ULIPs, as it is popularly known. ULIP is a unit linked insurance plan which not only ensures the life of the person but also provides market linked return by investing in various stocks, shares and other securities. As the investment of ULIPs are market linked the returns are far superior than other Insurance Plans and investment products like, Fixed deposit, postal savings etc.  

5. Retirement

Now that Santosh has ensured the security of his family members and also planned for wealth creation, it is time for him to look after his own responsibilities. You remember his dream of owning a farmhouse and living a relaxed life post retirement? However, if he spends almost all his salary in fulfilling the desire of others how would he make any substantial savings for himself? Then how can he expect to live a relaxed life post retirement without any earning or savings? 

We know he has investments in an Endowment Life Insurance Plan. But an Endowment Plan will offer him only a lump sum amount at the end of maturity period which might not be sufficient for him to meet his monthly expenses. Therefore, what he now needs is a Pension plan which will offer him regular income on a month on month basis post retirement. While he can make use of this money to take care of his monthly expenses he can use the maturity proceeds received from other plans to invest in his dream. Therefore, he should invest in a Life Insurance Pension Plan.

Remember, the life insurance policy to be purchased depends on ones need and not on the general trend. You must plan your Insurance needs based on the amount you need in future and not based on your current expenses. The average Inflation rate in India is around 8% therefore you should determine the future cost by taking into account the inflation rate. In a nutshell, before purchasing any Life insurance Plan you must properly analyze your needs like Santosh and the premium amount that you can afford till the policy tenure. You should work out your future needs carefully with an IRDA licensed Insurance Advisor or the Insurance company and make the purchase decisions accordingly. A clear understanding of the various products and the benefits provided by them will help you decide when and what policy should be you buy.