Wondering if this is the right insurance policy for you? Find out using the ultimate checklist!
MANGO MILLIONAIRE is an easy and straightforward guide to mastering your money – from two trusted experts.
Read more for a handy list of the things you must consider before investing.
It's startling to realize that only about 4% of Indians hold adequate insurance, especially when compared to 80% of people in countries like the U.S. Often, we don't consider the necessity of insurance until it's too late. Relying on luck is risky when it comes to securing your family's future. It's far wiser to ensure their protection, no matter the circumstances. The core message is clear: prioritize insurance above all else—sabse pehle insurance.
Before you decide on a policy, refer to this checklist to ensure it is the right fit for you.
⬜ Coverage: Can the policy fully cover your family’s financial needs, outstanding loans and future expenses?
The policy's ability to fully cover your family’s financial needs is paramount. It should encompass outstanding loans and anticipated future expenses, such as educational costs and significant life events (weddings, etc.). By ensuring the coverage aligns with your lifestyle needs and projected expenses, you safeguard your family from financial distress in your absence.
⬜ Exclusions: What are the exclusions? Any mention of risky professions, hobbies, or activities that might affect your claim?
Understanding exclusions is critical in any insurance policy. These exclusions might include specific professions, hobbies, or activities that increase risk and could lead to denied claims. It’s essential to know these beforehand, so you are not faced with surprises if you need to make a claim.
‘A simple formula for calculating the right insurance coverage for you is: Insurance Needed = (Annual Expenses + Inflation) × Years to Support Family + Liabilities + Major Expenses. ’
⬜ Waiting Period: Are there any restrictions on claims within the first few years of the policy?
Some insurance policies have waiting periods restricting claims within the first few years. Knowing your policy's specific terms can help you manage expectations and financial plans in case of an early claim requirement.
⬜ Premium Affordability: Can you pay the premium amount consistently without feeling financial strain?
The premium must be a manageable expense within your budget. If the premium causes financial strain, the policy could lapse, negating its purpose. Ensuring that premiums align with your financial abilities is vital for maintaining coverage over time.
⬜ Claim Settlement: Does your insurer have a high claim settlement ratio to ensure a hassle-free experience?
A high claim settlement ratio is a sign of a reliable insurer. This ratio indicates the percentage of claims the insurer successfully settles, reflecting their reliability and efficiency. Understanding this can help provide peace of mind, knowing that claims are likely to be handled efficiently.
‘Tip: Buying term plans is cheap, skipping them is costly.’
⬜ Read the Fine Print: Did you take the time to review the details before signing up? This isn’t something you want to overlook.
The importance of reviewing policy details thoroughly cannot be overstated. This includes understanding the terms, conditions, exclusions, and the specific benefits the policy provides. It's wise to comprehend all aspects before committing to ensure it meets your needs and expectations without any unfortunate surprises.
FIND OUT MORE:
Mango Millionaire
by Radhika Gupta
An easy and straightforward guide to mastering your money – from two trusted experts
How much should you spend and how much should you save? Should you rent or buy? How much debt is too much? Which insurance policy is right for you? How do you choose the best investment product?
If you’ve ever found yourself grappling with these questions, you’re not alone. As India’s financial landscape has evolved, the sheer number of choices have grown, but so have the myths and misinformation. Managing money isn’t just for the privileged few; it’s for everyone – especially the aam janta, or the mango people.
Radhika Gupta and Niranjan Avasthi draw from their extensive experience at Edelweiss Mutual Fund – one of India’s leading and fastest-growing asset management companies – to bring you Mango Millionaire – a crisp, reliable and no-nonsense guide to smart financial planning.
From budgeting and saving to investing, debt management, risk and taxes, it lays down practical advice in bite-sized, easy-to-read chapters. Packed with insightful stories from real investors and easy-to-follow steps, Mango Millionaire slices through the jargon and serves up practical answers to empower you to take control of your financial future.