LIC Jeevan Saathi

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How ICU charges can be devastating

                                           


Few weeks ago, one of my friends has talked to me at 10.00 in the night for about 10 minutes and everything was quiet normal. Early in the morning next day, I received a phone from his Mother, who was staying down stairs, that my friend had a 'Brain Stroke' the previous night around 11.00 and there were nobody in his house to notice it. His wife and kids have gone to their native place for summer holidays. The old parents have to rush him to a nearest Corporate Hospital and he was kept in ICU since then, for almost a month. The cost of ICU + medicines + other expenses are around Rs.40,000/- per day and after 25 days and a hospital bill of 10 LAKHS, he became conscious and was shifted to general ward. After another two weeks in general ward, he has now come to his house and was advised bed rest for atleast 6 months, till he regains his lost memory.

Since he was employed with a private company, he is not having a leave of 6 months to his credit and the insurance cover provided by his Employer was Rs.1.5 lakhs under group insurance. He is around 35 years of age and is a very normal person with no adverse Medical history. Around 2 months back, both of us got checked 'Normal' for a Master Health Checkup offered by a Corporate Hospital. He has also bought a flat very recently and as such he was not receiving salary in full. Some of the hand loans were still outstanding.

Since he himself is unable to speak, his financial position has gone down from bad to worse. Even if he joins his duties after six months, I don't think, he will be out of the financial crisis in the near future. Though he is an MBA, he would have never imagined that his family members would have to handle such a contingency in their life time.

Lesson to be learnt: Prioritising Health and Term Life Insurance Cover with disability benefits.      

Are you adequately insured

 

The basic concept of Risk Management is built on the following principle :

• Whether you can avoid the risk - possible through various risk management practices
• Whether you can ignore the risk - applicable in case of articles or goods whose value is nominal
• Whether you can retain the risk  - where the amount at risk is within your limits
• Whether you have to transfer the risk - where the risk is high and is beyond your limits

The principle of risk management, which is applicable to industries and firms, is equally applicable to individuals and families. If individuals ignore this aspect, entire family has to bear the burden of such indecisiveness. We come across many such cases in our day-to-day lives, wherein an individual with a liability of Fifty lakh Rupees, will be insured for a meagre sum of 5 or 10 lakhs, just because of his casual approach. The family members will have to bear the burden of such decisions and will have to forego either properties or will have to clear the debts by themselves.

The ideal Sum Insured would be :  Future income  +  Present liabilities.

This is for basic cover, without taking average annual inflation of 5 to 6%, into consideration. For example, an individual with the age of 35 years and with an annual income of Rs.5 lakhs, has to take an insurance cover for Rs.1.25 Crores(5 lakhs X 25 yrs). With  the rising incomes, this may go even up to 2 to 3 crores. Since the premium for an Endowment policy from any company will be very high for this Sum Assured, it is always advisable to buy a Term Policy at a nominal cost for either 1.5 or 2.0 crores, and secure ones family financially.

Once the family is secured financially from any uncertainties, the focus will shift to building a corpus for certain events in life like building a house or buying a flat, creating provisions for children's education, their marriages and finally for annuity or pension. Any miscalculation or adventurism will have devastating effects on middle class families and as such is not advised.

Please take the help of a professionally qualified Certified Financial Planner or an Insurance Adviser and protect your families responsibly.
                                                       

What is Term Insurance

Term Insurance is a product offered by Life Insurance companies, which pays the Sum Insured ONLY in case of death of the Life Insured  to  Nominee, along with Accident Benefit (if the LA dies in an accident and if Accident Benefit is opted for and is accepted by the Insurer).

There is no 'Maturity Value' or bonus for this policy. At the end of the term, nothing is payable.

But this should not be a deterrent while buying a Term Plan. We pay premium for our vehicle insurance promptly every year but even there we do not get anything. Are we less worthy than our Bike or Car ?

LIC's Jeevan Tarang

What does LIC's Jeevan Tarang Offer you?

Cash value of bonus on the full sum insured + Annual Installments @ 5.5% of the sum insured up to your 100 years of age + Sum Insured whenever you are not alive instead of annual installments, without any deduction towards installments already paid + Loyalty Addition if any, on your surviving the premium payment term you have chosen (10 or 15 or 20 years),

Sum Insured + Bonus accrued in case you do not outlive the premium payment term you have chosen ( 10 or 15 or 20 years)

Loan against surrender value at 9.00% per annum simple interest,

Additional sum equal to face value but not exceeding Rs 50 Lakhs in case of fatal accident against a small extra,

Premium waiver in addition to the above accident benefit in case of Total and Permanent Disability due to Accident against a small extra,

Term Cover Rider against extra

Why Should You Invest On LIC's Jeevan Tarang?

Under this plan, your nominee is assured of the face value of the policy on your death whenever it occurs within your 100 years of age. Your premium payment however is limited only for the term chosen (10 or 15 or 20 years).

You are assured of a regular annual income as long as you are alive up to a maximum of 100 years of age, once you outlive the premium payment term you have chosen. By going for LIC's Jeevan Tarang every month, you can reduce the frequency of annual installments to monthly also.

From income-tax point of value also, you stand to gain quite a bit through LIC's Jeevan Tarang investment. While the premium paid qualifies for Section 80 C benefit within the overall limit of Rs 1 Lakh per annum allowed for various savings, annual installments received as above are free from income-tax, since they are nothing but settlement options on the sum insured exercised by you. In other words, under LIC's Jeevan Tarang, you are assured of a tax-free annuity @5.5% of the sum you have insured for rest of your life, once you outlive the PPT chosen.

Bonus available before commencement of Annuity can be profitably invested to fetch you income additional to annuity installments available under the plan.

Policy loans available under the plan offer you additional investment facilities without affecting any of the policy privileges.

These are some of the prominent reasons why you should invest on LIC's Jeevan Tarang as much as you can.

How long you need to Invest on LIC's Jeevan Tarang?

10 or 15 or 20 years ceasing at death, if it occurs early.

What are the Modes of Investment available under LIC's Jeevan Tarang?

Single, Yearly, Half-yearly or quarterly or monthly.

Want to know more about LIC's Jeevan Tarang or want to invest on the plan? 

Call us at 9899307833 / 9811362697 or write us at everyoneinusred@gmail.com

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LIC's Jeevan Mitha (Triple Benefit)

What does LIC's Jeevan Mitra (Triple Cover) Offer you?

Sum Insured + Bonus Accrued For the Policy Term chosen, on your surviving the premium payment term you have chosen (15 to 30 years),

3 times the basic sum Insured + Bonus accrued on the basic sum insured in case you do not outlive the premium payment term you have chosen ( 15 to 30 years)

4 times the basic sum insured in case death is due to accident against a little extra,

Waiver of further premium payable + Basic Sum Insured spread over in the form of an Annuity for next 10 years + All other Maturity benefits in case of Total and Permanent Disability due to Accident,

Loan against surrender value at 9.00% per annum simple interest,

Why Should You Invest On LIC's Jeevan Mitra (Triple Benefit)?

Financial security available to your nominee in your absence during the currency of the plan is maximum,

Maturity Benefit available should you outlive the PPT you have chosen is quite impressive,

 Premium paid qualifies for Section 80 C benefit within the overall limit of Rs 1 Lakh per annum allowed for various savings,

Policy proceeds received by you on surviving the PPT chosen are free from income-tax under section 10(10D) of the I.T Act.

Policy loans available under the plan offer you additional investment facilities without effecting any of the policy privileges,

Most ideal as a collateral security while drawing housing or any capital loans in view of the high security it offers.

These are some of the prominent reasons why you should invest on LIC's Jeevan Mitra (Triple Benefit) as much as you can.

How long you need to Invest on LIC's Jeevan Mitra (Triple Benefit)?

15 to 30 years ceasing at death, if it occurs early.

What are the Modes of Investment available under LIC's Jeevan Mitra (Triple Benefit)?

Yearly, Half-yearly or Quarterly or Monthly.

Want to know more about LIC's Jeevan Mitra (Triple Benefit) or want to invest on the plan?

Call us at 9899307833 / 9811362697 or write us at everyoneinsured@gmail.com

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LIC's Bima Account -1

What does LIC's Bima Account - 1 Offer you?

Balance in your Account ( Total investment in regular premium account + Total investment in top up premium account - expenses) on surviving the policy term you have chosen (5 to 7 years),

Sum Insured + Balance in your account ( Total investment in regular premium account till the day of death + Total investment in top up premium account till day of death - expenses till the day of death) in case you do not survive the policy term chosen ( 5 to 7 years)

Guaranteed Interest at 6% per annum on the balance in your account,

Possibility of enhanced interest on the premium account portion of the policy account,

Loan against surrender value at 9.00% per annum simple interest after 1 year from the commencement,

Facility for topping up the premium with additional amount.

Why Should You Invest On LIC's Bima Account-1?

It is a short term plan of 5 to 7 years.

You are assured of a minimum 6% per annum on the balance in your account. In addition, there is a possibility of higher returns on your premium account. But in reality, you are earning more every year, since, more and more amount out of your gross investment is getting transferred to your policy account with reduction in charges towards expenses. Coupled with Section 80C benefit subject to a overall limit of Rs 1 Lakh per annum allowed for various savings and full I.T exemption on the claim amount you receive under section 10(10D) of the I.T Act, you will observe Bima Account 1 as one of the most lucrative investment options you love to explore.

The plan offers quite an impressive life insurance coverage right from day one till day last. In addition, entire balance in the policy account is returned in such an event marking the uniqueness of the plan!

Policy loans available under the plan offer you additional investment facilities without affecting any of the policy privileges.

These are some of the prominent reasons why you should invest on LIC's Bima Account-1) as much as you can.

How long you need to Invest on LIC's Bima Account-1?

5 to 7 years ceasing at death, if it occurs early.

What are the Modes of Investment available under LIC's Bima Account-1?

Yearly, Half-yearly or Quarterly or Monthly.

Want to know more about LIC's Bima Account-1 or want to invest on the plan?

Call us at 9899307833 / 9811362697 or write us at everyoneinsured@gmail.com

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LIC's Bima Account -2

What does LIC's Bima Account - 2 Offer you?

Balance in your Account ( Total investment in regular premium account + Total investment in top up premium account - expenses) on surviving the policy term you have chosen (10 to 15 years),

Sum Insured + Balance in your account ( Total investment in regular premium account till the day of death + Total investment in top up premium account till day of death - expenses till the day of death) in case you do not survive the policy term chosen ( 10 to 15 years)

Guaranteed Interest at 6% per annum on the balance in your account,

Possibility of enhanced interest on the premium account portion of the policy account,

Loan against surrender value at 9.00% per annum simple interest after 1 year from the commencement,

Facility for topping up the premium with additional amount.

Why Should You Invest On LIC's Bima Account-2?

It is a short term plan of 10 to 15 years.

You are assured of a minimum 6% per annum on the balance in your account. In addition, there is a possibility of higher returns on your premium account. But in reality, you are earning more every year, since, more and more amount out of your gross investment is getting transferred to your policy account with reduction in charges towards expenses. Coupled with Section 80C benefit subject to a overall limit of Rs 1 Lakh per annum allowed for various savings and full I.T exemption on the claim amount you receive under section 10(10D) of the I.T Act, you will observe Bima Account 2 as one of the most lucrative investment options you love to explore.

The plan offers quite an impressive life insurance coverage right from day one till day last. In addition, entire balance in the policy account is returned in such an event marking the uniqueness of the plan!

Policy loans available under the plan offer you additional investment facilities without affecting any of the policy privileges.

These are some of the prominent reasons why you should invest on LIC's Bima Account-2) as much as you can.

How long you need to Invest on LIC's Bima Account-2?

10 to 15 years ceasing at death, if it occurs early.

What are the Modes of Investment available under LIC's Bima Account-2?

Yearly, Half-yearly or Quarterly or Monthly.

Want to know more about LIC's Bima Account-2 or want to invest on the plan?

 Call us at 9811362697 / 9899307833 or write us at everyoneinsured@gmail.com

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LIC Health Insurance Jeevan Arogya

What is Jeevan Arogya?
It is LIC’s family Medical Insurance Plan. 

Whom All I can cover under Jeevan Arogya?
Yourself (Known as Principal Insured), Your Spouse, all your family members including dependent parents and parents-in-law in the age group 0-75.

Is there any Maturity or Death Benefit under Jeevan Arogya?
What is the Mandatory requirement for claiming Medical Benefits under Jeevan Arogya? Hospitalization in India due to either accident or sickness for at least 24 hours, every block of 4 hours deemed as 1 day.

What is the basis of calculating Medical Benefits under Jeevan Arogya?
Hospital Cash Benefit (HCB) you opt for at the time of entering the plan. It can be anything between Rs 1, 000/- to Rs 4, 000/- per day (in multiples of Rs 1,000).

What are the eventualities covered under Jeevan Arogya?
Hospitalization as above. No surgery: Cash reimbursement equal to Applicable Daily Benefit (ADB) x No of day's hospitalization.
ICU admission: 
Cash reimbursement equal to double the ADB.

Listed Surgical Procedures:
Cash reimbursement equal to 2 times the ADB subject to a maximum of 45 days in a year or 360 days during the entire policy term (15 days - First Year).
Listed Day Care Procedures:  5 times the ADB applicable regardless of the actual costs incurred not exceeding 3 times in a year and 24 times in the entire policy term.

What is `Applicable Daily Benefit' (ADB)' referred to under Jeevan Arogya?
It is the sum total of HCB you have opted for at the commencement of the plan + 5% of the HCB you earn every year subsequent to first year reaching a maximum of additional 50% of the initial HCB + 5% of the HCB you earn at the end of every 3 years in case you have not claimed any amount under the plan for previous 3 years, without any limit.

How long I need to pay premium under Jeevan Arogya?
Upto age 80, if the age at entry is 18-75 years, Upto age 25, if the age at entry is 0-17.

Does premium under Jeevan Arogya remains same throughout the premium payment term or will it keep varying? 
It keeps varying once in 3 years.

Is there any Income-Tax Benefit on Jeevan Arogya Premium?
Yes, Premium paid every year enjoys I.T exemption under section 80 D within the statutory limit for medical insurance premium up to Rs 15,000/- per annum in case of individuals and Rs 30,000/- for the family members.

Does Jeevan Arogya offer any Cash-less facility?
No.

What is so special about Jeevan Arogya?
This is one plan where,You get medical coverage up to age 80 without any interruption, provided, policy is kept in force by premium payment in time. You can cover all your family members including your parents and parents- in law in the age group 0-75. Medical reimbursement available under the plan is independent of the actual medical expenses incurred. Mere hospitalization followed by discharge certificate is enough to claim medical reimbursement unlike  Mediclaim plans where medical reimbursement is directly related to the actual expenses claimed by your hospital. As a result, unlike  Mediclaim Plans, Jeevan Arogya takes care of your post treatment expenses and possible drop in your income especially during prolonged illness.
You can draw up to 50% of the claim amount in advance for meeting surgical procedures instead of waiting for the claim settlement. ADB keeps increasing every year by 5%, reaching a maximum of 150%. As a result, other benefits like HCB and MSB sum also stand increased. You can claim HCB every year upto 30 days at a stretch that includes 15 days in ICU or as a lifetime benefit up to 720 days that includes 360 days in ICU.

It provides you premium waiver for next 1 year in case of your undergoing major surgical procedures.
Jeevan Arogya investment as an additional benefit, even if you have invested in General Insurance Companies' Mediclaim plans Infact, a combination of Jeevan Arogya Mediclaim could be the best way of providing for medical exigencies. While Mediclaim provides for Medical Expenses during treatment,  Jeevan Arogya takes care of your monetary requirement after treatment.

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Investment options for a New Generation

ENTER ULIPS - A NEW PARADIGM :

Complying with the condition imposed by the Reserve Bank of India, to maintain solvency margins, the Life Insurance Companies started launching Unit Linked Insurance Plans, where no fixed returns are assured to the client and the returns depend on the market performance. All Life Insurance companies started selling ULIPs with vigour and enthusiasm that markets are headed North and that BSE Sensex would touch 1 lakh.

Come 2008 the entire scenario has changed. There was gloom surrounding Stock Markets and the clients, who were unfamiliar with the fluctuations of the Markets, felt let down by Insurance Companies. The very people who stood in queues all day to pay the premiums were dejected and frustrated. The delicate fibre of confidence and trust, which binds an Insurance Agent and a client started to fade away slowly.

RE-ENTRY OF CONVENTIONAL PLANS :

For well over 50 years, the risk-averse average middle class Indian, had never felt a jolt like this. There were redemption of ULIPs all over and people just refused to listen. This even affected the Mutual Funds market and the stock market. The conventional plans of insurance, which do not participate in the market but still give a return of 6 to 7% per annum, started to gain ground. 

We are all back to square one - still unable to de-link 'Insurance' and 'Investments'.

Delinking Insurance and Investments

Image courtesy : Google

We come across many instances, where people are sold insurance policies in the name of savings. People, particularly those from lower middle class, are most often the victims of this theory. Let us study its  backdrop and  evolution.

BACKGROUND :

When the life insurance was nationalized, the 300-odd private companies were operating more or less like today's chit fund companies. After nationalization, the primary objective of LIC was to inculcate the habit of savings in the evolving mixed economy. Since most of the services were run by Government, wages were low and so was cost of living. Primary services like education, medical care and transport were heavily subsidized and focus was given to small savings from Post Office and products like Postal Life Insurance and Endowment Plans from LIC were promoted by the Govt.

The scene changed drastically post liberalization. As the Governments withdrew subsidies one after the other private sector entered the space vacated by the Govt.institutions. Education was the first area which raised the cost of living. Sectors like Health care, real estate, communications, transportation followed suit. With no substantial rise in income levels in employed sector, the parity between future commitments and present income, began to widen.

ALIGNING WITH GLOBAL MARKETS :

When the insurance sector was opened to Private Enterprises, several new products were introduced, but the basis of insurance remained same. All products were designed around three basic concepts viz., Endowment, Money Back and Whole-life. Exclusive policies meant for children, women and senior citizens remained the same. With increase in companies, the spread of insurance has multiplied throughout length and breadth of the Nation. The specialized knowledge of Insurance, which was the forte of PSU insurers, slowly started spreading all around. The operational and technical expertise of MNCs, has paved way for establishing new benchmarks in client service.

But this was no solution to the gap between income and expenditure of an average middle class Indian family. The reason is simple - the returns given by either PSU Insurer or Private Insurers were simply not in a position to beat inflation. From Government's point of view, everything is fine - there is a positive growth in the Life Premium garnered by the Insurers and is being invested in the Stock Markets year after year.


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