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Health insurance This is a critical period since you are likely to start facing medical problems. To ensure you retain the health cover and critical illness rider/cover, pay the premium so that the policy does not lapse. If it does, you'll have to pay a high premium, take medical tests, and pre-existing diseases will be covered only after the waiting period. Continue with your existing covers for accident&disability, as well as property insurance. Raise the latter toaccountfor inflation or after a rise in contents. Health insurance This is the most crucial period for your health as your medical expenses are likely to comprise a big chunk of your outflow. So, ensure your premiums are paid regularly. COVER `10 lakh ANNUAL PREMIUM Will vary depending on claims. Personal accident & disability covers Continue with your existing covers. COVER (STRUCTURE & CONTENT) `60 lakh ANNUAL PREMIUM `6,200 Property insurance Do not end this policy as you need to protect your property and its contents at all times. Review to account for inflation and increase in contents. SINGLE & EMPLOYED MARRIED, WITH KIDS MIDDLE AGE, OLDER KIDS MARRIED, NO KIDS RETIREMENT Life insurance During these years, you are unlikely to need fresh insurance unless you take a loan or act as guarantor for your child's education loan. It will also be the period when you start to cash in on your endow- ment policies or child plans. So continue with your existing cover. Life insurance By this time, you would have stopped earning, your children would be financially independent, most of your liabilities, including loans and debts, would have been paid, and you would have built assets. So when the life cover's term ends, you won't need to buy more. COVER Nil From the time you start working till retirement, each lifestage calls for a review of your insurance portfolio. While some covers, like those for vehicle and travel abroad, are mandatory, others need to be bought proactivel y. Find out the t ype and quantum of insurance you'll need. Insurance for each lifestage TEXT RIJU MEHTA ACCIDENT COVER `25 lakh DISABILITY COVER `25 lakh ANNUAL PREMIUM `1,500 ANNUAL PREMIUM `1,600 Life insurance If you have no financial dependants, you don't need to buy a life cover, but if you support someone or have taken an education loan, you may need one. The best option would be an online term plan till retirement. The amount should be 5-6 times your annual salary. If you are a non-smoker male with a monthly salary of `30,000: COVER `20 lakh ANNUAL PREMIUM `3,400 TERM 30 years Life insurance If your salary has risen to `45,000 (approx 10% a year) and your spouse is working, you will need to raise your cover. Instead of a fresh cover, you can also pick a top-up plan, with a lower premium. If your spouse is 27 years old, non-smoking and employed, with a salary of `35,000 per month: If your spouse is non-working, buy a higher cover for yourself. COVER `30 lakh ANNUAL PREMIUM `4,200 TERM 30 years COVER `20 lakh ANNUAL PREMIUM `3,400 TERM 30 years COVER `50 lakh ANNUAL PREMIUM `4,700 TERM 30 years SPOUSE COVER `45 lakh ANNUAL PREMIUM `6,500 If your spouse's salary has risen to `55,000 a month (10% a year): If you want to plan for your kid's education/marriage, buy a child plan. While it offers a cover and a lump sum on maturity, the premi- um is high. For your 4-year-old, it will yield`10-14 lakh on maturity. Life insurance If your income is now `75,000 (approx 10% a year), you have two kids, aged 6 and 4, and have taken a`30 lakh home loan, a car loan of `4 lakh, your cover should be: COVER `80 lakh ANNUAL PREMIUM `9,500 TERM 25 years COVER `40 lakh ANNUAL PREMIUM `60,000 TERM 15 years COVER `45 lakh ANNUAL PREMIUM `6,500 TERM 30 years Property insurance If you've bought a house worth `40 lakh, insure it against damage. You'll also have to review the contents and raise the cover, if needed. COVER (STRUCTURE & CONTENT) `50 lakh ANNUAL PREMIUM `5,000 Health insurance At this stage, you will need to increase the cover of your family floater plan to include your children. Also consider a critical illness rider, which will cover the risk of major illnesses like cancer, heart attack, etc. It takes care of the costly treatment and loss of income. CRITICAL ILLNESS `5 lakh ANNUAL PREMIUM `3,000 COVER `5 lakh ANNUAL PREMIUM `10,000 COVER `80 lakh ANNUAL PREMIUM `9,500 ANNUAL PREMIUM `4,500 ANNUAL PREMIUM `20,000 Personal accident & disability covers If your spouse (27 years) is working, ensure she also buys these. ACCIDENT COVER `25 lakh ANNUAL PREMIUM `2,000 Property insurance You may not have a house of your own, but cover the contents of your house, including electronic gadgets, jewellery, etc. COVER `5 lakh ANNUAL PREMIUM `1,600 Personal accident & disability covers Don't write off this cover as superfluous since it’s probably one of the most important ones you need once you start working. It will help ward off any loss of income due to a mishap, including partial/ total or temporary/permanent disability. 25 YEARS 30 YEARS 35 YEARS 45-50 YEARS 60 YEARS COVER `7.5 lakh CRITICAL ILLNESS COVER `5 lakh Personal accident & disability covers Since you would have stopped working and would have sufficient assets by now, you won't need to buy a fresh plan. COVER Nil ANNUAL PREMIUM `4,000 Health insurance You’re likely to be covered by your employer’s group insurance, but given the rising cost of medical care and the fact that you could be coverless between jobs, it’s better to have your own medical insur- ance. Besides, the premium will be lower at this age. COVER `3 lakh TERM 1 year Health insurance Convert your policy into a family floater plan, which will cover both you and your spouse at a lower premium than individual plans. COVER `3 lakh ANNUAL PREMIUM `4,800 Premiumsare indicat ive.Theywillvaryamong insur ers,andasper aperson'ssituati on/need s. Premiumsforhealthcoverwillvaryas perclaims. Instea dofbuying freshcove rs,itwill be cheaperto buytop-up plansand riders . Considerinflation while calculating covers. 16 The Economic Times Wealth, August 26-September 1, 2013 Learn & Keep
