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Family Health Insurance For Expecting Parents

Health insurance has almost become one of the basic necessities of life and in ways can it be termed as a luxury or an option, particularly in a developing country like ours wherein the cost of healthcare is relatively high and also health care is not that easily accessible to one and all, having an adequate health insurance cover is a must. Health insurance plans are utmost important as they can go a long in smoothening out a medical urgency that can otherwise turn ugly if one is not well prepared in advance. Not just for an individual but these days, exclusive health insurance plans for senior citizens to children with plans for particular diseases and many different family health insurance plans.

Family health insurance, in particular, is a more holistic type of insurance that facilitates complete coverage for all family members under one single policy. It usually provides proper cover for several diseases within a single unified plan and on the basis of the plan selected; it could be more than one time for one specific disease for all members. It functions on a certain sum ascertained for the policy to provide for the entire family that entitles the family to claim multiple times for every person covered within the mentioned duration of the plan.

And family health cover becomes way more critical when one is the way to parenthood as having a child can seriously increase one’s medical expenses in terms of maternity procedures like a caesarian operation or hospitalization and other treatment. Thus, it is extremely significant for expecting parents to avail a suitable health insurance plan in order to prep-up for the coming tough times and staying relaxed free with respect to the medical expenses. There are many reputed insurance companies that offer exclusive plans for maternity as an add-on feature to the existing family health insurance policy or even a new one.

The maternity health cover facilitates coverage for only pregnancy and delivery related medical expenses including a normal delivery or caesarian surgery or any related treatment costs as well as the initial baby hospitalization and care expenses are also offered by many good companies under relevant plans. There are several benefits of a maternity health cover for expecting parents to invest in including cashless hospitalization, hospitalization charges included for all treatment before and after the delivery and the room cost as well, ambulance cost also included along with all cost coverage for the newborn child as well such as nursery charges and initial vaccinations etc.

Life Insurance and its Five Types

Therefore, just to make your decision easy below are the five basic types of life insurances that you can choose from-

  1. Term Coverage Plan- This type of policy provides you protect from uncertain mishap for few set of years as stated in the plan. The premium that you are asked to pay remains stable throughout the policy period. If you purchase term life plan, then be sure that you will get the policy benefit only if the policyholder dies within the set of years mentioned in the policy. In short, it is the most instant protection giving life insurance policy.

In fact, many of term indemnity plans provide you facility to renew your policy term years. However, as many times as you will renew, the premium will increase. Similarly, few of the term insurance can also be converted into whole life insurance plan but again you need to pay high premium.

  1. Whole Coverage Plan- It is the type of life policy that makes sure that your family is protected after your death no matter when you pass away. It is the most common kind of indemnity where you need to pay same premiums for lifetime. However, the premium of whole life insurance is much higher than term plan, but still it is cheaper than renewing your term plan often.

You can buy online life insurance policy or through an agent. Few of insurance policies allow you to pay all your due premiums in shorter period, say for 20 or 30 years or till you are 60. However, then you need to pay high premium every month as insurance company needs to cover all premiums in less time.

Even though premium of whole indemnity plan is bit more as compared to term plan, still there is one advantage. It provides you cash value so, even when you discontinue paying your premium, you can use the cash in cash value account for other purposes or to purchase new insurance.

  1. Variable Coverage Plan- It gives you lifetime security and several benefits to your family after your demise. However, depending on the profit of the investment of your insurance plan, the demise benefits may oscillate often. Though, many variable coverage plans ensure that the policy amount won’t decrease more than a specified amount that was promised to you at time of buying. Therefore, we can say it is a type of permanent life policy but with many risks involved.
  2. Universal Coverage Plan- It is distinction of permanent life policy. Here, your insurance amount is kept aside from your investment amount of the plan. The investment amount of plan is invested in mortgages and other market trust funds. In contrast to whole indemnity plan, the cash value in under universal coverage plan keeps growing and the nominee is paid from cash value account only. Even if your policy investment turned out badly, you will be given a promised interest rate.
  3. Variable-Universal Coverage Plan- In this your nominee will obtain certain benefits after you death. The performance of investment determines the benefit of the plan. It provides you more power on cash value. Even if the investment falls short, still you will be provided the promised interest rate.

Benefits and Need for Life Insurance

Insurance is no doubt most important and unavoidable and as we start earning, the first thought that strikes our minds is to get a life insurance. Most common reason for delaying this is lack of time and this makes us lose valuable time which can help us accumulate corpus.

In term insurance, you pay a premium for a specified period, for instance, 10, 20 or even 30 years, and at the end of that period, the policy matures and you get a lump sum amount which can be used or you can also reinvest if your financial position allows.

There are two situations which call for a term insurance – first is a longer life, which requires funds till longer period of time and second is dying too early, which requires you to financially secure your beneficiaries as soon as possible. However, it is not wise to delay such a crucial decision as no one knows when contingency knocks your door and so, it is good to stay prepared. Hence, we should never delay in taking up a life insurance, the best time to buy one is as soon as you accumulate the minimum amount required. This is because, it provides funds for coping up with adverse financial circumstances due to the death of the insured. Once, you decide to buy it, you will look for the best term insurance plan, which can be evaluated on the following features:

Death benefits are income tax free to the beneficiaries. Although a normal life policy is not tax deductible it is possible to take out relevant life insurance if you are an employee. Relevant life can save up to 40% over a normal policy. Try this relevant life calculator to see how much you could save.  If policy term is not over, and an adversary occurs, the cash withdrawals up to total paid premium is tax free and rest of it depends on the company.Policy loans are income tax free.Buying the policy online not only saves your valuable time, but also gives you the opportunity to weigh it against other options online, since all the information is provided on the websites.This has the most favorable tax treatment unlike other available financial instruments.

Life Insurance is designed keeping in mind that we are all prone to sudden or natural accidents and death. This is the best precaution one can take to ensure a supply of income in times of need when a person is disabled, retires from work or human life is lost. Though life cannot be priced in monetary terms, we can still accumulate this saving to support our beneficiaries even in our absence or in the absence of our regular income.

Follow These Tips to Buy The Best Life Insurance Policy

In the year 1956, Life insurance sector was nationalized and in the same year Life Insurance Corporation came into existence. Since then, LIC has been making people aware about the importance and benefits of life insurance policy. But the real penetration of Insurance sector started after the entry of private players in the year 2000, due to privatization of the insurance sector. It extended the benefits and widened the reach of life insurance.

With the efforts of government and insurance companies, the number of people insured in India has increased a lot. But still many people don’t have the right life insurance policy. Many people don’t understand the various aspects of life insurance policy and end up buying a policy which gives them no benefit when required.

So through this article, we will look at some of the tips to buy the best life insurance policy.

Tip 1: Analyze your need for life insurance

You must understand your need for insurance. Your clear purpose for buying a life insurance will help you to filter your search in an appropriate manner. Now, life insurance policy isn’t only limited to protection against life, but it can also be used for various other purposes also. You may buy life insurance as a protection against loan or debt, investment option, saving option or as a retirement plan. For serving all these various purposes, there are different life insurance policies like Term Plan, Whole life plan, ULIP plans and you also need to customize your life insurance plan according to your need. So it is better to understand your basic need for buying a life insurance policy, which will help you get maximum benefit from the policy.

Tip 2: Decide the Right amount of Cover

The right amount of cover puts a strong base for making the best life insurance policy for you. A low amount of cover will keep you away from getting the right benefit while a high amount of cover will dig a big hole in your pocket. It is very much necessary to know how much cover you need. A right amount of cover is built upon the basic four pillars, which are, annual income, future obligations, inflation and debts. Keep all these factors in consideration to choose the right coverage amount which will help you to get what you expect from your policy.

Tip 3: Choose a plan as per your Risk Appetite

It is important to buy a life insurance product as per your need and risk appetite. If you want guaranteed returns on your policy, you should go for a traditional life insurance policy. If you have a high risk appetite and ready to take market risks, then you may opt for unit linked life insurance plan.

Tip 4: Compare Different Policies

Any product bought without comparison can make you pay a higher price with less benefit. Same goes with life insurance policy. It is very much necessary to compare life insurance plans of different companies. And with the availability of internet, comparing life insurance policy has become very easy. Insurance web aggregators provide a very easy and unbiased comparison of different life insurance companies. You can also visit websites of different insurance companies and know about the plan at brief.

Tip 5: Go through Fine Print

It is very much necessary to go through the fine print of the policy. There are many circumstances under which you are not covered in a life insurance policy and you must know them. A brochure of the policy contains all the details and is available on the insurer’s website. You must read every point of the brochure and if any questions arise, you must get it cleared as soon as possible. It will help you to understand the exclusion, inclusion, terms and conditions of the policy at brief.

Benefits And Risks of Life Insurance Premium Finance

Life Insurance Premium finance is the safer way of purchasing life insurance, especially for high net worth individuals. It allows a company to borrow the cost of life insurance premiums. It usually occurs when the company has a very high premium that makes it necessary to borrow the amount in part or in whole to prevent reducing the company’s liquidity.

More often than not, traditional lenders don’t provide premium financing, and business owners need to look for specific premium financing providers to secure the loan.

Benefits of Premium Finance

When a company releases a large amount of payment, its owner must first consider whether the funds are needed for the daily operation of the company or for the expansion of the business. And in order to prevent liquidating some of the company’s assets or using key funds, financing is required.

More often than not, businesses depend on some type of loan to be sustainable. Premium financing is often a part of the debt cycle for company with high corporate owned life insurance costs.

A business owner can finance multiple policies via a single agreement that allows the owner to make a single insurance premium payment a month. In most cases, insurance companies accept premium financing and accept payment straight from the finance provider. When that is the case, the premium finance company will bill the business owner instead of the insurer.

Premium Financing of Non-Qualified Executive Bonus Plans

Premium financing can be used on non-qualified executive bonus plans, which are available for vital employees of any type of corporation. The employer has the discretion to select the workers to cover and the amount of the bonus. The business owner pays for the premiums on the policy, and the employee has to pay tax that’s equal to the premium amount.

Financing of 770 Accounts

A 770 account is a permanent life insurance policy that has been structured to maximize its cash value. By maximizing the total death benefit and cash value, you can maximize the cash value of the life insurance policy. More often than not, the cash value is tax-free and can be accessed at anytime.

770 accounts have a very competitive rate of return and can be used as collateral. But the premiums can be high. High net individuals or business owners can resort to financing in order to keep up with the premium payments without the need to liquefy assets.