Prajna Capital - An Investment Guide

Term insurance may not be the most-marketed product by life cos, but it’s a must-have in today’s risk-prone lifestyle WHEN was the last time your insurance agent sold a term plan to you? It’s not a very popular policy among agents, as their commission in absolute terms is low because of the low-premium. Just as agents have their self interests in mind while selling, you need to make your own decision about your insurance needs, which are unique to your family. COST ADVANTAGE A term plan is pure protection. It is the cheapest type of life insurance policy. But what you see might not be what you get, most insurers have a range of health parameters for standard rates. If any of your health parameters — weight, blood pressure for instance fall outside this range, you will pay more. For some companies, the standard range is very narrow. EARLY BIRD GAINS A 30-year-old will pay 15% more premium than a 25-year-old. At 40, the premium is double of what is applicable for a 25-year old, points...

Add-on offers or riders are best options for customising your present and future insurance needs. But you have to be careful while opting for one. This article provides a pocket guide for taking the right cover In a bid to stand out above the pack in the face of increased competition, insurance companies have of late started offering add-ons to customise their products and make them more powerful. These add-ons — or riders, as they are called — are a special policy provision or group of provisions that can be added to a policy to supplement the cover provided. They allow you to increase your insurance coverage or limit the coverage set down by the policy. Riders can also be blended according to your present and future insurance needs. Riders are optional additional benefits that you can opt for with your insurance plan for a nominal extra amount. One important thing to remember, however, is that riders are always attached to the basic policy which a person takes. They cannot be bo...

Some conditions that enable you to claim a tax deduction on the expenses incurred towards the medical treatment of family members You can take a medical insurance plan for yourself, your spouse, parents or dependent children. Under Section 80D, you can claim a deduction up to Rs 15,000 for the premium paid. Mediclaim policies are offered by almost all insurance companies. Mediclaim policies provide insurance cover for the treatment of most ailments and hospitalisation. In addition to the basic cover, add-ons are available on payment of extra premium. You should go through the coverage and exclusion clauses carefully. In some cases, pre-existing ailments are also covered on payment of an additional premium. The cover may be enhanced to ailments which are not normally covered also. Some insurance companies provide cover for day-care and annual medical checkups as well. For senior citizens who are tax payers and 65 years of age or more, the limit now has been enhanced to Rs 20,000...

Here are some tips to help you choose the ideal insurance policy that meets your needs Numerous insurance products such as children's education plans, life insurance plans with huge death benefits, and accident insurance covers are marketed aggressively. Often, people aren't aware of the actual insurance coverage. They jump onto the bandwagon, without reading the fine print. Tax payers make hasty last-minute insurance purchases to avail tax benefits under Section 80C. Though you may be saving a small amount of tax money, you could be stuck to a worthless policy for long years. Here are a few points to ponder over while buying an insurance policy: Insurance is not investment Insurance products are designed to provide protection. A term cover usually offers insurance protection but no benefit in case the insured survives the term of the policy. A unit-linked insurance policy ( ULIP ) on the other hand provides dual benefits of insurance protection and a flexible inves...