Author: Sidharth Hampanavar

Best Pension Plans in India – Compare & Buy Top Retirement Plans

Sidharth Hampanavar

You need money at all stages of life. When you are working, you are financially independent and you have various financial responsibilities on your head. After you retire, your financial responsibilities are taken care of but you still need funds to meet your lifestyle expenses. After retirement, you don’t work and don’t have a regular source of income. That is why you need a specific fund which would meet the expenses of your retirement. A retirement fund is, therefore, needed after retirement and you need to plan for the fund when you are working.

Planning for retirement:

Retirement planning should be done starting from an early age. This is because of the following reasons:

  1. Longer investment horizon
    When you are young you have longer investment tenure to invest before you retire. The longer the investment tenure is the higher the corpus that you can accumulate for retirement. Moreover, when the investment tenure is high, you also earn higher compound interest because the interest grows exponentially if the tenure is high. Both these factors of a longer investment period and higher returns ensure you have a good retirement corpus.
  2. Smaller investment required
    When you start from an early age, you can invest smaller amounts to build up a larger corpus. You can set aside small, affordable amounts every month regularly and build up a large corpus over time because your investments would attract compound interest and grow substantially if they are given time.Both these reasons stress on creating a substantial retirement corpus which would be sufficient to cover your expenses for two or three decades down the line. A substantial retirement corpus is needed because after you retire the cost of goods and services would have increased manifold due to the effect of inflation. As such, if your corpus is small it would not be sufficient to cover your expenses fully. So, you should start saving early so that you can create a good corpus through affordable investments.

Top #5 Retirement planning tools

Since retirement planning is important, there are different types of retirement plans in India which help you create a retirement fund. Some of the popular investment avenues include the following –

  1. Fixed deposits
    Fixed deposits are where you invest a lump sum amount for a specific period of time. Your deposit, thereafter, earns a guaranteed rate of return and the deposited amount along with the returns earned is refunded when the deposit matures. Fixed deposits are good for investors who are looking for fixed returns from their investments.
  2. Mutual funds
    Mutual funds are another popular investment option which promises market-linked returns. You can invest small amounts in a chosen fund regularly through Systematic Investment Plans (SIPs) and then earn market-linked returns on your investments. There are different types of funds to choose from but you should know that mutual funds are exposed to market risks and returns are not guaranteed.
  3. Real estate
    Many investors also consider real estate investments for their retirement. They invest in a plot of land or property and then sell the property to get gains. Real estate investments, however, involve huge sums of money and are not suitable for small investors.
  4. Public Provident Fund
    Public Provident Fund (PPF) is a fixed interest investment avenue wherein you can make investments regularly or in a lump sum. PPF gives you guaranteed returns which are also tax-free in nature and you can also choose a long investment period to grow your retirement corpus substantially.
  5. Life insurance pension plans
    Life insurance pension plans are specifically designed retirement oriented life insurance plans which help you create a retirement corpus. Pension plans promise you the payment of annuities after you retire. These annuities are a series of payment which gives you a regular income for your lifetime.Among the above-mentioned retirement planning tools, pension plans offered by life insurance companies are the best and the most suited tool for your retirement. Do you know why? Let’s understand the concept of these plans and why they are ideal for retirement planning –

What are pension plans in India?

Pension plans are a type of life insurance plans where the insurance company promises to pay a lifelong income to you through annuities. Under pension plans, you can invest in building a retirement corpus. Thereafter, when you retire, the plan promises the payment of annuities throughout your life.

Types of pension plans in India

Retirement plans in India come in two variants – deferred annuity and immediate annuity. Let’s understand these variants in details –

  1. Deferred annuity plans
    Deferred annuity plans are those wherein you can choose the investment tenure to create a retirement fund and annuities are paid after the investment tenure is over. Under deferred annuity plans, you buy a plan with a chosen term. During the term, you can pay premiums which are accumulated to create a retirement corpus. Thereafter, when the plan tenure is over, you can use the accumulated corpus to receive annuities. Moreover, in case of death during the plan tenure, deferred annuity plans also promise a death benefit. Thus, deferred annuity plans provide insurance coverage as well as the promise of annuity payments for your life.
    Features of deferred annuity plans
    Deferred pension plans in India have the following salient features –

    1. The plan can be offered as a traditional insurance plan with guaranteed returns or as unit-linked insurance plans with market-linked returns
    2. When the plan matures, you can withdraw 1/3rd of the corpus in cash. This withdrawal is called commutation of pension and it is tax-free. From the remaining corpus, you would have to receive annuity payments. The remaining corpus is utilised to buy an immediate annuity from the company to provide annuity to the annuitant.
    3. In traditional deferred annuity plans, you can earn bonuses
    4. Premiums can be paid in one lump sum, for a limited period or over the entire duration of the plan
    5. Under deferred plans, there is an accumulation phase, deferment phase and a pension phase. The accumulation phase is when you pay premiums to create a corpus. Deferment phase is when the corpus grows. Pension phase is when you receive pension payments from the accumulated and grown corpus.
  2. Immediate Annuity Plans

    Immediate annuity plans are those which promise you immediate annuity payments without any waiting period. The age of entry for Annuity Plan depends from company to company so that pension can start immediately waiting. –

    The annuity payments are promised for as long as you live and depending on the annuity option chosen, the purchase price –

    Features of immediate annuity plans

    1. You can choose the annuity payment frequency. It can be annually, half-yearly, quarterly or monthly
    2. There are different types of annuity payment options and you have to select one option as per your requirement. Common examples of options include increasing annuity, the annuity payable for a joint-life annuity payable for life and return of purchase price, etc.
    3. Immediate annuity plans are traditional life insurance plans which promise a guaranteed rate of annuity
    4. Premiums are payable only one as a single premium. This premium is also called the purchase price

Benefits of pension plans in India
Pension plans are said to be the best retirement planning tools because of the following benefits which these plans give –

  1. Pension plans in India promise a lifelong income. This income ensures that your retired life is led comfortably without any financial hiccups
  2. Immediate annuity plans allow you to receive annuities on a joint life basis. This means that you can add your spouse as the secondary annuitant and in case of your death, the annuity payments won’t stop. They would continue for as long as your spouse is alive. This feature allows you to ensure a source of income for your spouse too in your absence thus giving them financial security in their old age
  3. Premiums paid for pension plans in India are allowed as a tax deduction under Section 80CCC of the Income Tax Act. Thus, by investing in pension plans, you can also lower your tax liability while building your retirement corpus
  4. The commuted pension that you receive is tax-free and allows you to meet any financial responsibilities that you might have
  5. These pension plans in India create a certain amount of corpus solely for your retirement and allows the corpus from being used on other financial needs
  6. You can create a substantial retirement corpus through unit-linked deferred annuity plans which promise you market-linked returns on your investments
    Given these benefits, there is no doubt that pension plans in India are the best way to create a retirement fund for your golden years.

Top #4 pension plans in India

If you are looking to invest in a life insurance pension plan, here are some of the best pension plans in India which you can choose from –

  1. LIC’s Jeevan Shanti Plan
    When it comes to best pension plans in India, LIC has some of the best options to offer and its Jeevan Shanti policy is a very popular plan. Here are the salient features of the plan –

    • The plan can be taken as an immediate annuity plan or a deferred annuity plan
    • Premiums are payable only once
    • You get a choice of nine types of annuity payment options to choose from
    • If you opt for a deferred annuity plan, you also get guaranteed additions during the deferment phase to build up your corpus
    • The loan is allowed under the policyEligibility parameters
      Entry age30 to 85 years
      Deferment period1 to 20 years
      PremiumMinimum- INR 1.5 lakhs
      Maximum – no limit
      Annuity amountMinimum – INR 12,000/year
      Maximum – depends on the premium paid
  2. LIC’s New Jeevan Nidhi Plan

    Another plan offered by LIC, Jeevan Nidhi Plan is a traditional deferred annuity plan which has the following salient features –

    • The plan promises bonuses as well as guaranteed additions during the policy tenure
    • LIC’s Accidental Death and Disability Benefit Rider is available as an optional coverage benefit which you can choose at an additional premium
    • Premiums can be paid at once or regularly throughout the policy tenure
    • You get premium discounts for choosing a high sum assured and also for paying the premiums annually or half-yearly

      Eligibility parameters

      Entry age20 to 60 years
      Deferment period5 to 35 years
      Sum assuredMinimum – INR 1 lakh
      Maximum – no limit
      PremiumDepends on the sum assured chosen
  3. ICICI Pru Immediate Annuity Plan
    This is an immediate annuity plan offered by one of the leading life insurance companies in India. The salient features of the plan are as follows –

    • You get a choice of 12 annuity options under the plan
    • Premium is payable only once to buy the plan
    • You can get higher rates of annuities if the purchase price is high
    • If you are a National Pension Scheme investor, you get a discount of 0.5%

      Eligibility parameters

      Entry age30 to 100 years
      PremiumDepends on the annuity that you want
      Annuity amountMinimum – INR 12,000/year
      Maximum – depends on the premium paid
  4. HDFC Life Click 2 Retire Plan
    HDFC Life’s Click 2 Retire is a unit-linked deferred pension plan which has the following salient features –

    • The plan has minimal charges which ensure that you can get maximum growth for your fund value
    • The vesting benefit is guaranteed even if the market is volatile
    • Premiums can be paid at once or for a limited period

      Eligibility parameters

      Entry age18 to 65 years
      Deferment period10 to 35 years
      PremiumMinimum- INR 24,000
      Maximum – no limit
      Annuity amountDepends on the premium and fund value

Buying pension plans in India – what you should know?

Before you invest in a pension plan for your retirement needs, there are some factors which you should keep in mind. These factors include the following –

  1. Type of plan
    Choose the type of plan based on the need of receiving annuities. If retirement is a long way off and you have started investing early, choose a deferred annuity plan to build up a retirement corpus. If, on the other hand, you are retired and want to invest your corpus for regular incomes, immediate annuity plans are ideal. So, choose a plan based on your needs.
  2. Sum assured and premium
    In case of deferred annuity plans, choose a sum assured which would be sufficient to cover your family’s financial needs in case of your absence. However, along with the sum assured ensure that the premiums are affordable so that you don’t feel a pocket pinch while saving for retirement.
  3. Vesting age
    Vesting age is the age at which you start receiving annuities. Choose the vesting age wisely. The higher the vesting age is the higher would be the annuity amount. So, choose an age from which you would need annuity income to fund your retirement.
  4. Annuity amount
    The annuity amount depends on the premium that you have paid and the vesting age selected. You can calculate the annuity amount beforehand through annuity calculators. Ensure that the annuity amount is sufficient to cover your retirement expenses.
  5. Compare before buying
    The last factor to keep in mind is comparing the available pension plans in India. There are a lot of plans available in the market and when you compare you can find the best plan. So, go online and compare the pension plans in India to choose the most suitable one.

How to buy pension plans in India?

Buying pension plans in India has been simplified due to the online mode which allows you seamless processes and hassle-free buying. You can buy online pension plans in India through Turtlemint which is an online platform giving you the chance to compare the available plans before buying. You can find both deferred and immediate annuity plans online and then buy them as per your needs. To buy through Turtlemint, you have to follow a simple process which is as follows –

  1. Visit https://turtlemint-stage.dreamhosters.com/life-insurance which is Turtlemint’s life insurance home page
  2. Choose ‘Pension/Retirement’ pension plans in India
  3. Provide your details which include your gender, date of birth, annual income, smoking habit, expected age of retirement, investment tenure, investment amount and frequency and your contact information
  4. You can then check the available pension plans in India which offer some of the best features
  5. Compare the available plans and choose one for your needs
  6. Fill up an application form for the chosen plan, pay the premiums online and you can buy the policy instantly online through Turtlemint
    Easy, isn’t it?
    You need a retirement plan in place if you want to lead an independent retired life which is dependent on no one. So, invest in pension plans in India and create a retirement corpus for yourself and your spouse. If you start early you can even leave behind a legacy for your children besides funding your retirement. So, don’t delay. Start retirement planning at the earliest so that you can amass a good corpus by the time you retire.

Frequently Asked Questions:

  1. Can I buy more than one pension plan?
    Yes, you can buy as many pension plans as you like. There is no restriction on the number of plans that you can buy provided you can afford the premium.
  2. Is annuity income tax free?
    No, the annuity income that you receive from pension plans is taxable in your hands. The annuity would be considered as your income and it would be taxed at your income tax slab rates.
  3. Can I defer the vesting age if I want?
    Yes, many deferred annuity plans offer you the option to defer the vesting age and receive annuities from a later date. If you do so, you can get a higher annuity rate by staying invested for a longer period.
  4. Do immediate annuity plans have any death benefit?
    The death benefit under immediate annuity plans depends on the annuity payment option that you choose. Usually, under life annuity option, the annuity payments stop after your death and there is no death benefit. However, if you have chosen the return of the purchase price, the premium that you paid would be refunded back on your death. Moreover, in the case of joint life annuities, in case of your death, the annuity continues if your spouse is alive and stops on the death of the spouse.

Best Cashless Health Insurance Plans : Compare Plans, Benefits & More!

Sidharth Hampanavar

With the dramatic rise in healthcare costs, medical emergencies can make a big hole in your pocket. Hence, it has become imperative for everyone to buy health insurance plans in India. While buying health insurance plans, people consider various things such as coverage offered, premium and additional benefits etc. But, the most important thing one must consider in any health insurance plan is the ‘’cashless facility’’ offered to avail the quality medical care services at the right time.

Overview of cashless health insurance

Cashless health insurance is a health insurance policy that comes with a cashless claim facility. As the name implies, in cashless health insurance plans, you don’t have to face the hassles of paying cash during medical emergencies and then getting it reimbursed from insurers. In this, your insurer will directly settle the medical bills to the network hospital where you avail healthcare treatments. Hence, in order to avail the quality healthcare treatment at the rightly needed time, it’s important to have an ideal health insurance plan that is supplemented by the cashless facility. With a cashless health insurance policy, you can get the timely treatment even without having a contingency fund for medical emergencies

Features of cashless health insurance

Today, health insurance policies come with wide array of features cover each and every aspect of healthcare emergency. There are plans to suit the healthcare requirements of individuals, families, senior citizens, women and group of people etc. Almost every insurer today is offering cashless health insurance policies. Features of these policies are designed by the insurance companies. Let’s take a look at some of the standard features offered by cashless health insurance plans.

Following are the features of a cashless health insurance policy:

  • In-patient hospitalisation expenses
  • Pre and post hospitalisation expenses
  • Day care procedures
  • Domiciliary treatments
  • Daily hospital cash allowance
  • Emergency ambulance cost cover
  • Value added services
  • Pre-existing illness cover
  • Free health check-ups
  • No claim bonus
  • Organ donor cover
  • Critical illness cover, etc.

Top #4 Advantages of cashless health insurance

An ideal cashless health insurance plan is the one that offers you unending benefits in the time of need. Let’s take a look at the major benefits offered by cashless health insurance.

  1. Extensive coverage:

    Cashless health policies provide comprehensive coverage for all health issues including in-patient care, pre hospitalisation and post hospitalisation, domiciliary hospitalisation, day care procedures, health check-ups and ambulance coverage etc. Many policies provide additional coverage such as critical illness cover, parental care, maternity expenses and new born child cover etc. to make the coverage extensive.

  1. Convenience of instant cashless treatment:

    Cashless health plans are the quickest with the convenience of an immediate treatment facility at network hospitals without having to pay the cash. The best part is hospital network is widely spread across the country in almost all the insurance companies. Hence, cashless medical treatment can be availed by you conveniently even when you are travelling.

  1. Worry-free access to funds:

    If you have cashless medical insurance, you can avail treatment in the time of need without any worry irrespective of your financial condition at the moment. Cashless insurance offers a sense of security as there is no worry of depleting savings or liquidating assets. You will be in a better position to handle the unforeseen situation with the financial security offered by cashless health plans.

  1. Saves tax:

    Along with all the financial protection and convenience benefits, a cashless health insurance policy also offers tax benefits.

Premiums paid towards health insurance plans taken for self, spouse, children and parents can be claimed under Section 80D of the Income Tax Act for tax deduction.

Following are the details –

DescriptionAll members of the family below 60 years of ageSelf, spouse and children  below 60 years age
Either of the parents above 60 years age		Self- 60 years above Spouse and children below 60 years of age
Parents above 60 years age
Maximum premium for self, spouse and dependent childrenINR. 25,000INR. 25,000INR. 50,000
Maximum premium for parents (dependent/non-dependent)INR. 25,000INR. 50,000INR. 75,000
Total deductions availableINR. 50,000INR. 50,000INR. 1,00,000

 

Types of cashless health insurance policies in India:

There are various types of health insurance policies offered in India with cashless facility. Following are the types of cashless health insurance policies available in India:

  1. Cashless individual health insurance:

    Cashless individual health insurance policies provide coverage to an individual against various unforeseen medical events depending on the terms and conditions of the policy.

  1. Cashless family health insurance:

    Cashless family health insurance provides coverage to an entire family in a single policy against various unforeseen medical events as per the terms and conditions of the policy.

  1. Cashless senior citizen health insurance:

    Cashless senior citizen health plans provide healthcare coverage to senior citizens with many exclusive features like coverage for pre-existing illness, day care and critical illness etc.

  1. Cashless mediclaim/group health insurance:

    Cashless mediclaim insurance policies provide coverage to the group members. These are the employee sponsored health insurance plans providing coverage against various unforeseen medical events.

Top #5 best cashless health insurance plans

There are a wide variety of cashless health insurance policies available in the market. The best cashless health insurance plan out of these plans may vary depending on each individual’s requirement. However, here we have tried to list out five best cashless health insurance plans available in the market.

Following are the details:

 

Plan namePlan typeEntry ageRenewabilityWaiting period for pre-existing illnessSum insured (in INR)Premium
Apollo Munich Optima Restore PlanIndividual/ Family floater91 days to 65 yearsLifelong36 monthsINR 3 lakhs to INR 50 lakhsINR 7,971
Star Family Health Optima PlanFamily floater16 days to 65 yearsLifelong24 monthsINR 2 lakhs to 15 lakhsINR 10,608
HDFC ERGO Health Suraksha PolicyIndividual/ Family floater3 months to no limitLifelong48 monthsUp to INR 10 lakhsINR 8,044
Religare Care PolicyIndividual/ Family floater91 days to no limitLifelong48 monthsINR 2 lakhs to INR 60 lakhsINR 6,318
ManipalCigna ProHealth planIndividual/ Family floater91 days to no limitLifelong48 monthsINR 2.5 lakhs to INR 100 lakhsINR 6,996

(Premium is taken for a 30-year-old healthy male for INR. 5 lakhs sum insured. Star family Health optima plan premium is for a 30-year male + a 28-year-old spouse, as the plan is family floater)

Apollo Munich Optima Restore Plan

Apollo Munich Health Insurance is one of the leading private health insurers in India with a wide gamut of health plans in its product offering. The company offers best in class services with 4500+ network hospitals across the nation. Let’s take a look at some of the amazing features offered by optima restore health plan.

Following are the key features/facilities offered by the plan:

  1. The plan offers comprehensive coverage for various expenses that include hospitalisation, daycare, pre hospitalisation and post hospitalisation, organ donor expenses and daily hospitalisation allowance etc.
  2. The policy offers no-claim benefit for each claim-free year which is up to 50% along with multiplier benefit that can double the NCB benefit up to 100% of sum insured.
  3. The plan comes with an automatic sum insured restoration benefit
  4. The policy offers you portability benefit which helps you get all the previous transferable benefits under the policy
  5. You can stay active and earn up to 8% renewal discount by using stay active mobile application
  6. Complimentary health check-up at the block of every two years
  7. Policy comes with an optional add-on cover called ‘critical advantage rider’ that covers eight major illnesses for up to INR. 10 lakhs. Policy also offers e-opinion facility post-diagnosis of critical illness
  8. Policy requires no pre-medicals for a person aged below 45 years and for sum insured below INR 15 lakhs

Star Family Health Optima Plan

India’s first standalone insurance company, Star Health Insurance Company offers various uniquely crafted health insurance plans for you and your family. With its largest network of 9600+ hospitals, the company displays excellent service quality. Star family health optima is one of the best plans offered by the company to secure your entire family under one umbrella. Let’s take a look at the key features and facilities offered by the plan.

  1. Policy offers extensive coverage for the whole family at reasonable cost of premium. Coverage mainly includes, hospitalisation, pre hospitalisation and post hospitalisation, 405 day care procedures, organ donor expenses, domiciliary hospitalisation and newborn cover etc.
  2. 100% automatic restoration of sum insured benefit
  3. Policy offers no claim bonus of up to 35% of the sum insured
  4. Recharge benefit to enhance the sum insured up to 30%
  5. Health check-up benefit of up to 1% of the sum insured
  6. Policy offers you portability benefit which helps you get all the previous transferable benefits under the policy
  7. Policy requires no pre-medicals for person aged below 50 years

HDFC ERGO Health Suraksha Policy

HDFC ERGO General Insurance Company offers a diversified range of health insurance plans to suit various healthcare needs of its customers. With a wider network of 9500+ hospitals, the company endures your healthcare needs are addressed effortlessly. Health Suraksha plan of HDFC ERGO comes with various amazing benefits and features. Let’s take a look at the features of the plan.

  1. Policy offers wider coverage that includes in-patient care, day care treatments, organ donor cover, pre hospitalisation as well as post hospitalisation and non-allopathic treatments, emergency ambulance charges etc.
  2. Policy offers optional add-ons like maternity cover, critical illness benefit and convalescence benefit etc.
  3. Policy offers family discount of up to 10% on premium for covering two or more family members
  4. Policy offers 5% cumulative bonus for each claim free year
  5. Automatic sum insured restoration benefit
  6. Health check-up allowance of up to 1% of the sum insured
  7. Policy requires no pre-medicals for person aged below 46 years

Religare Care Policy

Religare Health Insurance is one of the most trusted brands that offers a wide range of health insurance plans. With 4700+ network hospitals, Religare makes global healthcare treatment easily available for you. Religare Care is one of the best plans offered by the company with various valuable features. Let’s take a look at the facilities offered by Religare Care policy.

  1. Policy comes with complete package of wide coverage that includes in-patient care, pre hospitalisation and post hospitalisation, day care treatments, organ donor expenses, outpatient cover, daily hospitalisation allowance, ambulance charges and domiciliary hospitalisation etc.
  2. Sum insured restoration benefit of up to 100% is offered
  3. No claim bonus of 10% on each claim free year up to a maximum of 50% is offered. The plan also comes with additional no-claim bonus of 50% making the total to 100%
  4. Complimentary health check-up once a year
  5. Policy offers discount on choosing longer policy term
  6. Policy requires no pre-medicals for person aged below 46 years. However, the requirement may depend on sum insured chosen and health history

ManipalCigna ProHealth Plan

ManipalCigna Health Insurance Company formerly known as Cigna TTK Health Insurance Company offers a wide range of health insurance solutions. ProHealth plan is one of the best products offered by the company to secure you and your family. Let’s take a look at amazing facilities offered by the plan.

  1. ProHealth policy offers flexibility in choosing the plan based on your healthcare requirements – plans available are Protect, Plus, Preferred and Premie.
  2. Policy comes with comprehensive coverage that includes in-patient hospitalisation cover, day care treatments, organ donor expenses and pre and post hospitalisation cover etc.
  3. Policy offers up to 10% of long tenure discount and family discount on premium
  4. Restoration benefit of up to 100% of sum insured
  5. No claim benefit of 5% to 10% (depending on the plan chosen) is offered which can be accumulated up to a maximum of 100% of sum insured
  6. Policy comes with voluntary deductible of INR. 1 lakh, INR. 2 lakhs and INR. 3 lakhs which can help you reduce your premium to a certain extent
  7. Complimentary health check-up for every three years
  8. Policy provides you an option to earn healthy rewards that can reduce your premium
  9. Policy provides maternity cover and worldwide emergency benefit
  10. Policy comes with optional add-ons – critical illness cover and waiver of copay.

11 most important points to consider before buying a cashless health insurance policy

To buy the best cashless health insurance plan, certain important points are to be considered. Following are the important points to consider while buying:

  1. Coverage:

    Coverage offered by the policy needs to be given utmost importance at the time of buying. It’s important to have adequate coverage in case of an unfortunate event. Not just the amount of sum insured, coverage offered needs to be comprehensive in terms of features and benefits also. Consider wider coverage policies that can cover almost every medical situation. There are policies that come with restoration features, wherein sum insured gets reinstated when it’s exhausted. Consider policies with such features.

  1. Exclusions:

    It is important to consider what is not covered in the policy before you buy it. Cashless health claims also can get rejected if you are not aware of the limitations. Being aware of exclusions helps you make a rational decision

  1. Claim settlement ratio:

    The claim settlement ratio or incurred claim ratio of the health insurance company is an important consideration while buying your cashless health insurance policy. As the ratio signifies a company’s potential to pay claims, it’s ideal to go with cashless health plans of insurers with a high claim settlement ratio.

  1. Co-payment:

    Co-payment refers to the portion of medical expenses that needs to be paid by you as an insured before placing the claims with the insurance company. Hence, it’s important to look for policies that have no co-pay clause.

  1. Network hospitals:

    Cashless facilities can be availed only at network hospitals of the insurance company. Hence, to avail treatment without any hassles anytime, it’s good to go with an insurer having a wider hospital network.

  1. No claim benefits:

    No claim benefit is one of the common features in any cashless health insurance. Basically, you can avail this benefit for being healthy and not making any claim during policy year. Benefit for each claim-free year can be accumulated up to a maximum of 50% by most of the policies.

  1. Lifetime renewal:

    With the rising age, it’s difficult to get comprehensive medical cover. Hence, it’s important to consider policies that are renewable for lifetime in order to avoid coverage hassles and high premium.

  1. Waiting period:

    Almost every cashless health insurance plan comes with a waiting period, after which financial benefits can be claimed for specific treatments, illnesses and procedures. Policies with less waiting period can help you get financial aid without much waiting. Choose the best cashless health insurance policies based on your requirement.

  1. Portability:

    If you have to switch from one insurer to another for any reason, portable cashless health plans transfer all your earned benefits to the new plan. Hence, portability is an important consideration.

  1. Additional benefits:

    Health insurance policies do come with additional benefits like critical illness cover and accidental cover etc. which can enhance your healthcare cover. Consider such features while buying the best cashless health insurance plan

  1. Cost:

    Though, the cost of the policy is not the primary consideration, it’s important to avail all the required benefits at an affordable cost. You can compare the quotes of various cashless health plans online on side by side basis.

How to buy cashless health insurance plans?

As most of the best cashless health insurance plans are available on an online platform, buying is more convenient. Plans of your choice can be bought anytime, anywhere within a few clicks online. You can buy the best cashless health insurance plans through Turtlemint through following steps:

  1. Go to Turtlemint and choose the category of insurance as ‘health’
  2. Click on ‘buy new policy’ and select your profile details such as gender, members to be insured, age, health history and contact details etc.
  3. Compare the plans available and select the cashless health plan based on your need
  4. Provide necessary coverage details
  5. Make the payment online. That completes the buying process!

Documents required for buying cashless health insurance plans

Following are the documents required for buying cashless medical insurance plans:

  1. PAN card is mandatory
  2. Age proof – Birth certificate/SSLC mark sheet/Voter ID/Passport etc.
  3. Identity proof – PAN card/ driving license/voter’s ID/ passport/aadhaar card, etc
  4. Proof of address – Driving license/passport/latest electricity bill/ telephone bill etc.
  5. Photographs

Requirement of pre-medical check-ups may vary depending on the policy’s terms and conditions.

What is the process of cashless health insurance claim?

Usually, in cashless medical insurance policies, TPA (third party administrators) work like a bridge between the insurance company and the network hospitals that helps to speed up the claim process. Some insurance companies will have their in-house claim processing team which makes the process even quicker. Generally, TPAs or insurers will have their help desk set up in their network hospitals to help the claimant.

Cashless health insurance claim process may vary depending on whether it is emergency hospitalisation or planned hospitalisation. Let’s take a look at the process.

  • Cashless emergency hospitalisation

    During medical emergencies, if the insured gets admitted at any network hospital, following is the process to be followed for cashless claim:

    • Once the insured is admitted to the hospital, insured needs to show health card issued by his/her insurance company. Health card will have all the vital details such as name of the insurer, policy number and plan type etc
    • Insured needs to contact TPA/insurance desk and initiate the cashless claim by filling up pre-authorisation request usually within 24 hours of hospitalisation
    • Third party administrator/insurance company will review all the initial documents submitted
    • Once the cashless request is approved by the insurance company further documents are to be produced by the hospital to expedite the claim process
    • Once final set documents submitted by hospital are verified, claim amount will be directly settled with the network hospital
  • Cashless planned hospitalisation

    In case of planned hospitalisation at the network hospital for any treatment/procedures, following is the process to be followed:

    • You can go through the insurance company’s website to take a look at the list of network hospitals available for treatment or can seek this information by contacting the customer support team of the insurance company
    • Once you choose your preferred network hospital to get treated, you need to fill-up pre-authorisation cashless request form which can be downloaded online on TPA website or can be obtained from insurance desk at the hospital
    • It’s important to submit this pre-authorisation from within specified time limit prior to hospitalisation. Time limit may vary from insurer to insurer
    • Hospital authorities or an attending physician will also go through your request form, verify the details and sign
    • The submitted request form will then be checked by TPA/insurance desk for eligibility and authenticity
    • Post verification by insurance desk or TPA, approval will be sent to network hospital for cashless treatment
    • On producing the final documents by hospital, payment of claim will be directly made to the hospital

Documents required for cashless claim settlement

Requirement of documents may vary on claim to claim basis. However, there are certain common documents that are needed for cashless medical insurance claims. Following are the documents required:

  1. Claim form duly filled and signed
  2. Doctor’s advice for hospitalisation
  3. Discharge summary of the hospital
  4. Doctors’ prescription, treatment details along with original medical bills and receipts given by hospitals, diagnostic centres, doctors and pharmacies
  5. Diagnosis reports (ECG/Scan/X-ray, Lab test reports etc)
  6. Police FIR copy for accident cases
  7. Health card copy, etc.

Exclusions under cashless health insurance

Though cashless health insurance policies provide comprehensive coverage against most of the medical emergencies and health conditions, there are certain exclusions applicable under these plans. Some of the exclusions come with waiting periods, thus temporary in nature. Some of the medical costs are permanently excluded from the policies. Let’s take a look at exclusions under cashless medical insurance.

  • Temporary exclusions
    • Medical expenses incurred during the first 30 days (initial waiting period) of the policy
    • Specific medical illnesses/treatments – usually come with the waiting period of 12 -24 months
    • Pre-existing illnesses – usually come with the waiting period of 24 -48 months
    • Maternity expenses – Generally come with the waiting period of 9 months to 6 years
  • Permanent exclusions

    Following are some of the general exclusions under cashless medical insurance:

    • Non-medical expenses
    • Pregnancy and childbirth
    • Fertility treatments
    • Sexually transmitted diseases
    • AIDS/HIV
    • Self-medication/treatment
    • Unproven and experimental treatments
    • Congenital illnesses
    • Mental disorders/illnesses
    • Cosmetic treatments
    • Treatments received outside geographical limits
    • Self-inflicted injury
    • Breach of law
    • War and nuclear perils
    • Alcohol and drug abuse

    To conclude, cashless health insurance plans give you peace of mind and sense of complete financial security against various health issues and emergencies without having to worry about personal financial condition. With a wide variety of plans available for purchase online, compare them on a cost-benefit basis and secure your health!

Cashless health insurance – FAQs 

  1. What is the meaning of TPA?

    TPA stands for Third Party Administrator. TPA is a company which is tied-up with the insurance company to help its customers with a cashless claim. In case of a claim the customer should contact with the TPA of the insurance company which, in turn, would contact the company on the customer’s behalf. Thus, TPA is the intermediary between the insurance company and the customer at the time of claims.

  2. What is the meaning of PPN?

    PPN stands for Preferred Provider Network. PPN is the hospital which is tied-up with the insurance company for allowing cashless claim settlements to the company’s customers. Thus, when you get admitted at a PPN, your claims would be handled on a cashless basis.

  3. Are pre and post-hospitalization claims settled on a cashless basis?

    No, usually, pre and post-hospitalization claims are settled on a reimbursement basis while your inpatient hospitalization expenses are settled on a cashless basis.

  4. How can I find the list of networked hospitals for cashless claim?

    The list of networked hospitals is available on the insurance company’s website. You can visit the website of your insurer and find the list of networked hospitals in your city. Alternatively, you can contact the claim helpline number of your cashless health insurance policy and ask the helpline department to locate the nearest networked hospital. The claim department would also be able to provide the details of the hospitals in your city at which you can avail cashless claims.

  5. What is a health card?

    A health card is a card which is issued with your cashless health insurance policy. This card contains your name, policy number and customer ID. When you are getting admitted in a networked hospital you need to present this health card for availing cashless claims. The card helps the hospital identify you as the insured member and the number contained on the card is used to process your cashless claims.

Know everything about Health Insurance premium calculator

Sidharth Hampanavar

Illnesses and diseases are rising alarmingly. Nowadays, the majority of individuals suffer from common ailments like diabetes, hypertension, heart-related problems, etc. These and other illnesses require frequent medical attention. Medicine, on the other hand, is progressing quite tremendously. Now you can find cures and treatments for illnesses which never existing before. Medical procedures have become less invasive and cutting edge. However, medical costs have risen tremendously. In recent times, a basic instance of hospitalisation tends to cost tens of thousands. Imagine if you suffer from a serious contingency. The costs would be prohibitive.

To tackle the rising medical costs as well as the rising need for medical attention, health insurance plans become a must. These plans cover the medical bills which you incur if you are hospitalised and need treatments. Since health insurance plans cover medical treatments, your finances are protected.

When buying health insurance plans, it is always recommended that you opt for an optimal sum insured. If the coverage is small, the plan would not be able to cover all your medical expenses. This would defeat the whole purpose of buying health insurance. An optimal sum insured is, therefore, necessary especially when medical costs are high. What about the medical insurance premium though? Would you be able to afford it at the high sum insured levels?

What is a health insurance premium?

The health insurance premium is the amount that you need to pay to avail health insurance coverage. The insurance company issues you a policy and promises to cover your medical risks. You are required to pay a consideration for this promise undertaken by the insurance company. This consideration is the medical insurance premium. Based on the agreement of the insurance company to cover your medical risks and the consideration that you pay for the agreement, a health insurance policy becomes a legal contract.

How is health insurance premium calculated?

There are different factors which determine the medical insurance premium that you have to pay. These factors include the following – 

Following are the features of cashless health insurance:

  1. Your age –

    The older you are the higher would be the chances of facing a medical contingency. Premiums are, therefore, higher at higher age and vice-versa

  1. Your medical condition –

    If you suffer from existing medical ailments, they would affect the health insurance premium rates. If you have chronic ailments, the premiums would be increased to balance the high risk which the insurance company is taking

  1. A number of members being covered –

    If you are opting for a family floater health insurance plan and covering your family members, the premiums would be high. The more members are covered under the plan the higher would be the premium which you would have to pay

  1. Age of covered members –

    The age of the members who are covered under the plan would affect the premium rates. The older members are the higher would be their respective premiums. This would, therefore, increase the total premium payable under the policy

  1. Gender –

    Females are considered to be healthier than males. That is why health insurance premiums for females are lower than for males

  1. Coverage features offered –

    If the health insurance plan offers a range of coverage benefits, it would be expensive. The more the coverage benefits in a plan, the higher would be the premium rate

  1. Riders selected –

    There are additional coverage benefits offered with health insurance plans. These benefits enhance the cover and come at an additional premium. So, if you choose the available riders, the policy premium would increase

  1. Discounts available –

    There is a range of premium discounts which can be availed under health insurance plans. Thus, the available discounts help in bringing down the premium rate.

Other factors affecting health insurance premium calculations

Besides the above-mentioned primary factors which help in calculating the medical insurance premium, there are other factors too. These factors determine the premiums that the company charges. These include the following –

  1. The expenses incurred by the insurance company –

    The insurance companies incur expenses on marketing and distributing their insurance policies. These expenses are, in turn, recovered from the customers in the form of expenses which are added when calculating the premium rate. The higher the expenses incurred by the insurer the higher would be the premiums

  1. Underwriting practices of the insurer –

    Once you apply for a health insurance plan, the insurance company’s underwriting team assesses the risk in your proposal. If the underwriter finds a higher amount of risk, the premium can be increased

  1. Claim experience of the insurer –

    If, in any financial year, the insurance company incurs very high claims which exceed its premium collections, the company suffers a loss. To make up for this loss, the premiums might be increased

  1. Returns earned from the company’s investments –

    The premium which the insurance company collects is invested in various fixed-income investment avenues. These avenues yield returns which increase the value of the insurer’s assets. This would lead the insurer to fix lower premiums

Now that you know the factors which determine your health insurance premium, can you ascertain its affordability?

Actually, you can. There are health insurance premium calculators which help you calculate the premiums payable for a health insurance policy before you actually buy it. Let’s understand what these calculators are and how they work –

What is a health insurance premium calculator?

A health insurance premium calculator is an online calculator which is designed to calculate health insurance premiums. You would have to enter your coverage details into the health insurance calculator and the calculator would give you the medical insurance premium which you would have to pay. Thus, the calculator helps you assess your health insurance premium and judge its affordability.

How does the mediclaim premium calculator work?

To use the health insurance premium calculator, you would have to enter the following details which affect premium calculations –

  1. Your age
  2. The type of policy which you want to buy – individual or family floater
  3. The number and age of the members who are being covered under the plan (if you opt for a family floater policy)
  4. The sum insured that you want
  5. The policy tenure
  6. Whether you have any pre-existing illnesses or not
  7. Gender
  8. Area of residence

Based on these factors, the medical insurance premium would be calculated.

How you can save money by using health insurance premium calculator?

Besides telling you the premium payable, the mediclaim policy premium calculator also allows you to save money. Here’s how you can save money by using a health insurance calculator –

  1. You can calculate the medical insurance premium of different plans. Thereafter, you can compare the premium rates vis-à-vis the coverage benefits offered. After you compare, you can buy the best plan which offers the most inclusive coverage benefits at the lowest premium rates. As you find a plan with the lowest premium rate, you can save money
  2. The mediclaim premium calculator shows you the premium break-up of the basic coverage and any optional riders that you have selected. When you know the premium break-up, you can opt-out of riders which you do not need with your health insurance plan. As you opt-out of riders, the additional premiums payable for the same would be saved
  3. The health insurance premium calculator also shows you the discounts available under different policies. You can compare the discount rates and choose the policy with the maximum discounts to save on the premium cost

Benefits of health insurance premium calculator

It is a good practice to use the mediclaim policy premium calculator to calculate the premiums because the calculator gives you the following benefits –.

  • The health insurance premium calculator is dynamic. You can change the details were entered into the calculator and the premium rates would change. The health insurance calculator, therefore, allows you to try different combinations of the sum insured and policy tenure options to arrive at the most affordable medical insurance premium
  • You can ascertain the premium cost of your health insurance policy before you actually buy the policy. When you know the expected health insurance premium, you can make provisions in your annual budget for the same. Paying the premium for the policy would, then, become easier
  • The health insurance premium calculator helps you to judge the affordability of your health insurance policy
  • If you use the mediclaim policy premium calculator of an insurance technology firm, like Turtlemint, you can compare the premium rates of different policies. You can then compare the available health insurance policies and choose the policy with the best premium rates.

Given these benefits, using a health insurance premium calculator is a must before you buy health insurance.

How to reduce health insurance premiums?

Though the health insurance premium calculator shows you the premiums that you want to pay, there are ways to reduce your medical insurance premium. These ways are as follows –

  • Try and buy the policy at a younger age
  • Choose a policy which has the coverage benefits that you need. The higher the cover features the higher would be the premium. So, choose only those coverage benefits which are required and cut down on unnecessary premiums
  • Choose only those riders which you need
  • Go for long term policy tenure. When you choose a term of two or three consecutive years, the insurance company offers a premium discount which lowers your premium
  • Some policies offer premium discounts if no claims are made in a policy year. If you have such a policy which offers the no claim discount, utilise it
  • You can avail a premium discount if you add family members to the plan’s coverage
  • Compare and buy so that you get the plan which offers good coverage benefits at lowest premium rates
  • Lead a healthy lifestyle as your health would affect your premiums

Tax benefits of health insurance plans

The premium that you pay for a health insurance policy qualifies as a deductible expense under Section 80D of the Income Tax Act. You can claim the premium as a deduction from your taxable income and lower your tax liability.

The deduction which is allowed is as follows –

  1. If you are below 60 years of age and you buy a health plan for yourself, spouse and/or children – up to INR 25,000
  2. If you are 60 years and above and you buy a health plan for yourself, spouse and/or children – up to INR 50,000
  3. If you are below 60 years of age and you buy a health plan for yourself, spouse and/or children + a health insurance plan for your dependent parents – up to INR 25,000 + up to INR 25,000 for parents’ policy
  4. If you are below 60 years of age and you buy a health plan for yourself, spouse and/or children + a health insurance plan for your dependent senior citizen parents – up to INR 25,000 + up to INR 50,000 for parents’ policy
  5. If you are 60 years and above and you buy a health plan for yourself, spouse and/or children + a health insurance plan for your dependent senior citizen parents – up to INR 50,000 + up to INR 50,000 for parents’ policy

So, you can claim up to INR 1 lakh as a deduction by paying medical insurance premiums for yourself, your family and your dependent parents.

Calculating health insurance premiums through Turtlemint

Turtlemint is an online website which allows you to calculate your medical insurance premiums, compare the available policies and buy the best plan. At Turtlemint you can ensure that you get the best coverage benefits at the best premium rates. Turtlemint offers you the following facilities –

  • Calculation of your health insurance premiums
  • Facility to compare the health insurance policies of leading health insurance companies with respect to their coverage benefits and premiums
  • Personalised assistance to buy the best policy
  • A one-stop platform to compare and buy the best health insurance plan
  • Assistance at the time of claims

You can, therefore, calculate your premiums on Turtlemint’s health insurance premium calculator. To do so, the process is as follows –

  • Visit www.turtlemint.com and choose ‘Health’
  • Choose any one option from the following –
    • Buy new policy
    • Top-up existing policy
    • Change insurer
  • Provide your details which include the following –
    • Gender
    • Members to be covered
    • Age of the members
    • Whether or not you are planning to have a child
    • Whether or not you have pre-existing illnesses
    • Area PIN code
    • Income level
    • Your contact details
  • Once all the information is provided, you can check the different health insurance policies, their coverage benefits and respective premiums
  • You can then compare the premium rates and buy the best policy directly from Turtlemint’s website.

A health insurance policy is a must in today’s age when medical costs are rising unchecked. So, invest in a good health insurance policy for yourself and your family. However, before you invest, don’t forget to use the health insurance premium calculator to calculate your premiums and ascertain their affordability. Only if the premiums are affordable, buy the plan and enjoy lifelong coverage.

How to Check LIC India Policy Details?

Sidharth Hampanavar

The Life Insurance Corporation of India was established in the year 1956 and up until the year 2000 LIC enjoyed a monopoly position in the life insurance segment. Even today, when there are more than 20 life insurance companies in the market LIC continues to have the largest market share. LIC India has a huge customer base which trusts the company and invests in different types of life insurance plans offered by LIC.

When it comes to the range of products offered, LIC India offers the following types of insurance plans:

  1. Term insurance plans
  2. Whole life insurance plans
  3. Endowment plans
  4. Money-back plans
  5. Child plans
  6. Pension plans
  7. Unit linked insurance plans
  8. Health insurance plans

You can buy any plan as per your suitability. To buy the plan, you are required to fill up a proposal form with your relevant information and submit the form with your documents. The first instalment premium would also have to be paid when the proposal form is submitted.

Once the form is submitted, LIC underwrites your risk and then issues you your insurance policy. After your LIC policy is issued, you might want to check your policy details. Even when you are an existing customer, you might want to check the status of your policy to check the term left, the surrender value, the bonus earned so far (if any) and any other relevant details of your policy.

Checking your LIC India policy’s status can be done without visiting LIC’s branch offices. LIC allows its customers with easy ways to check the status of their policy. The status of a LIC policy can be checked in any of the following ways:

  • Online
  • Through an SMS
  • By calling the customer care number of the company

Checking your LIC’s policy status online is, by far, the easiest and the most convenient method. You can check the status from your computer or Smartphone right from the comfort of your home or office and even on the go.

Enrolling LIC India policy online:

To check the policy status online, you would, first, have to enrol your LIC policy on the online portal of the company. Here is the step-by-step guide on how you can enrol your LIC policy online –

  1. Steps to enrol LIC policy for first-time/new users

    If you are a new customer of LIC and/or have not registered yourself for LIC’s online services, you are a new user. As a new user, first, you would have to create your LIC account and then you would be able to enrol your LIC policy. So, for creating your LIC account and enrolling your policy status, here are the steps:

    • Visit LIC India’s website https://www.licindia.in/
    • On the home page, choose ‘Customer Portal’ and you will be redirected to another page
    • On the next page choose ‘New User’ to register yourself
    • To complete registration you would have to provide the following details –
      • LIC Policy number
      • Premium amount
      • Date of birth (DD/MM/YYYY format)
      • Mobile number
      • Email Id
      • Passport and PAN number (optional)
      • Gender

    You would have to accept the terms and conditions and allow the stated mobile number to be used by LIC India for future communications

    • Click ‘Proceed’ wherein you would be taken to a new page where you would have to create your User ID and password
    • Once you choose a user ID and password and submit, your online LIC account will be created and you would become a registered user. You will be sent a verification email for completing your registration process. Click the verification link and your account would be created
    • Once your LIC account is created, log into your account using your user ID and password
    • When registering, if you selected ‘Yes’ to the question ‘Do you have any LIC policies?’ you would get an online policy enrolment form
    • Fill up the form stating the LIC policy number, premium amount, the name of the insured and other policy related details
    • Print the filled form and sign it. The form should then be submitted to the nearest branch of LIC from where you have purchased at least one policy
    • LIC would, then, verify the enrolment form and enrol your LIC policy online
  1. Steps to enrol for registered users

    If you already have a registered user ID and password for an online account, you can simply log into your account and enrol your LIC policy. To login, the steps are as follows –

    • Visit https://www.licindia.in/ and choose ‘Customer Portal’
    • Choose ‘Registered User’ and provide your user ID and password to log into your online LIC account
    • Along with your user ID and password, you would also have to provide your date of birth in DD/MM/YYYY format.
    • You can then select ‘Sign In’ to log into your LIC account
    • Once you enter your account, choose ‘Do you have LIC policies’ and answer ‘Yes’
    • You would get an online enrolment form
    • Fill up the form, take its print out, put your signature on the form and deposit the form at the nearest LIC branch office
    • The company would then verify the enrolment form and enrol your LIC policy online

    After the LIC policy is enrolled, you can check the LIC online status of your policy. Let’s understand the process –

Things to remember when checking LIC policy details online 

When you are a new customer and are creating your user ID and password for the first time, here are some things which you should keep in mind –

  • Your policy number would be required. Therefore, you should keep the details of your LIC policy handy
  • You have the flexibility of choosing any user ID which you want. Your user ID can be alphabetical, numerical and it can have characters like a dot or an underscore
  • The length of your password should be between 8 and 30 characters. Set a password which you would be able to remember easily. Your password should be unique and kept confidential to prevent any fraudulent activities in your account
  • The details which are marked with an asterix (*) are mandatory. You would have to provide such details to proceed further and register or log into your account
  • Your area PIN Code should be a 6-digit number
  • The email ID which you provide when signing up should be valid so that it can be used for any type of communication later on
  • Your user ID should be unique. If it matches an existing ID you would be informed and you would have to choose a unique ID for your account

How to check the status of LIC policy details online?

To check the status of your LIC policy, the steps are as follows –

  1. Visit https://www.licindia.in/ and go to ‘Customer Portal’
  2. Choose ‘Registered User’ and log into your LIC online account
  3. Choose the LIC policy number whose status you want to check
  4. As you select the policy, the policy details page will open which would show the status of your LIC policy

How to check the status of LIC policy through SMS?

LIC also allows you to check the status and other policy details through a simple SMS. You have to SMS from your registered mobile number and you get the answer through revert SMS on the same phone. The SMS should be sent to 9222492224 with the following texts –

Policy query

SMS to be sent

To know about the instalment premium payable under your LIC policy

ASKLIC<Policy number>PREMIUM

To know about availing policy loan 

ASKLIC<Policy number>LOAN

To know about the current bonus rate and the vested bonuses in the plan

ASKLIC<Policy number>BONUS

To revive a lapsed policy and to know about the revival

ASKLIC<Policy number>REVIVAL

To check your existing nominee details

ASKLIC<Policy number>NOMINATION

How to check policy status through customer care?

LIC has dedicated customer zones which help you with any type of LIC policy query that you have. The customer zones are active from Monday to Saturday and provide personalised assistance for all your insurance related queries, information, service requests, etc.

There are different customer zones for different cities. Here are the contact details of the customer zones of the top 50 cities –

Name of the city

Customer zone contact number

Agra 

0562-2524912

Ahmedabad 

079-27490619, 079-27461032 and 079-27461662

Amritsar 

0183-2560673

Bangalore

IVRS Number: 080-26659230
Phone number: 080-22966528, 22966553, 080-22966836/896

Bhagalpur 

IVRSNumber:: 0641-2610024
Phone Number: 0641-2610011, 2610033, 2610099

Bhubaneshwar 

IVRSNumber:: 0674 – 2573996
Phone numbers: – 0674-2573910, 0674- 2573911

Bhopal 

0755-2550242

Chandigarh 

0172-2678107

Chennai 

IVRS Number: 044-28884300
Phone number.- 044-28611912, 044-28611642, 044-25331915 and 044-25331914

Coimbatore 

0422-2300300

Cuttack 

IVRS Number: 0671-2307085
Phone Numbers. -0671-2307883,, 0671-2307889

Delhi

1800112552/ 011-23310868 and 011-22785930

Ernakulam 

0484-2383883

Goa

0832-2490100

Guwahati 

0361-2450389

Gwalior 

0751-2630272

Gurgaon

0124-2576060, 2578060, 2570060

Howrah 

033-2637-4387

Hyderabad 

IVRS Number: 040-23437997
Phone numbers- 040-23420730, 23420740 & 23420761

Indore 

0731-2533523

Jaipur 

0141-2702845

Jalandhar 

IVRS Number: 0181-2480918
Phone Number- 0181-2480967

Jamshedpur 

IVRS Number: 0657-2320600,
Phone Numbers – 0657-2443228 ,0657- 2443229

Jammu 

IVRS Number: 0191-2479717,
Phone Number- 0191-2479791

Jodhpur 

IVRS Number: 0291-2620079,
Phone Number- 0291-2657117 or 0291-2635076

Kanpur 

0512-2307443

Kolkata 

IVRS Number: 033-22545454,
Phone numbers – 033-22124172, 033-22124176, 033-2337-0642 and 033 2419-8476

Kozhikode 

Manager- 0495 2725581 
Executives 0495-2725583 IVRS 0495-2726006

Lucknow

0522-2614782

Ludhiana 

0161-2424074

Madurai 

0452-2370361

Mumbai 

IVRS Number: 022-26766221.
Phone numbers- 022-26788943, 022-27725968, 022-27723592, 022-28912605, 022-28913760 and 022- 28482907

Mysore 

IVRS Number: 0821-2346900
Phone Numbers – 0821-2341096, 2341099

Nagpur 

IVRS Number: 0712-2454820,
Phone numbers – 0712-2450083, 0712-2450080

Noida 

0120-2444026

Patna 

IVRS Number: 0612-2201795,
Phone Number- 0612-2332033

Pune 

IVRS Number: 020-25514248,
Phone number – 020-25539790

Raipur

0771-2210010

Rajkot 

IVRS number: 0281-2570871,
Phone numbers: 0281-2581318, 2581319, 2483210

Secunderabad 

040-27820146 and 27820136

Siliguri 

0353-2545739

Surat 

0261-2801833 and 2770227

Thane 

022-25423226 and 25421474

Tirunelveli

0462-2577070

Trichy 

0431-2741000

Trivandrum 

0471-2335222

Varanasi 

IVRS Number: 0542-2222412,
Phone Number- 0542-2220457

Vellore 

0416-2252202

Vijayawada 

IVRS Number: 0866-2484803,
Phone Numbers- 0866-2499595, 596, 597

Visakhapatnam 

IVRS : 0891-2523473
Phone no.: 0891-2558254 and 2513404

Checking your LIC Policy surrender value:

You can also check the surrender value of your traditional LIC policy online. Surrender value is the value that you would get when you surrender your policy before the completion of the plan term. Surrendering the policy can be done during the tenure of the plan by requesting the insurance company. The surrender value is calculated using the following formula –

Surrender value = [{Sum Assured * (number of premiums paid / total number of premiums payable)} + vested bonuses] * Surrender Value Factor

You can calculate your surrender value yourself or you can check your policy’s surrender value online in your policy details.

Why the LIC policy status should be checked timely?

You should do a periodic check of the status of your existing LIC policy. When you do a periodic check you can:

  • Find out the premium due date
  • See the remaining duration of the plan
  • Check the accumulated bonuses
  • Revive a policy which has lapsed
  • Make any type of service requests, etc.

Timely check, therefore, keeps you updated about your existing policy and you can plan your finances accordingly.

You can easily check your LIC policy’s status in different ways. Make the most of the facilities provided by LIC and keep a tab on your LIC policies to know your coverage. 

Frequently Asked Questions

  1. What are the charges involved in checking LIC policy status?

    LIC policy status can be checked free of cost. There are no charged levied by LIC if you want to check your policy status. Checking the online status is completely free of cost. If you send SMS to know the status, the SMS rates of your mobile service provider might apply. Even in the case of customer care numbers, the call rates of your mobile service provider might apply when you call. Besides these, there are no additional charges levied by LIC when you check your policy status.

  1. How many times can I check the status of my policy?

    You can check the status of your LIC policy as many times as you like. There is no limit on the checks that you can do.

  1. Is it necessary to enrol my LIC policy to check its status online?

    Yes, enrolling your LIC policy online is necessary to check the status online. You have to enrol your LIC policies if you want them to reflect on your online user account and if you want to check their status.

  1. What is ‘Add Policy’?

    ‘Add Policy’ is an option available on your online LIC account. Using this option you can add any other LIC policy that you have bought. Once the policies are added, their status can be seen online on your online LIC account.

  1. Can I enrol only those policies in which I am the insured?

    No, you can also add those insurance policies for which you are the policyholder whether or not you are the life insured. For instance, if you buy a policy on the life of your child and pay the premium, you would be the policyholder while the child would be the insured. You can add this child plan to your online account. Similarly, if you buy a policy on the life of your spouse, such a policy can also be added to your online account.

  1. What is the benefit of adding policies online?

    When you add your LIC policies to your online account, you can check the details and status of all your policies at one place. You can, therefore, get a complete picture of your insurance plans centrally on LIC’s website.

All You Need to Know About Cashless Mediclaim Policy

Sidharth Hampanavar

Having an adequate health cover is an essential requirement of today. Considering the rapid rise in lifestyle diseases, road accidents and inflated cost of healthcare, mediclaim is one of the most important investments one has to make. An unfortunate accident or a sudden illness can lead to huge amount of out-of-pocket medical expenses without having the right cashless mediclaim insurance policy. With the rising rate of healthcare inflation, treatment cost for minor illness can also deplete your savings and become a financial burden. Due to this rising concerns of treatment cost, many insurers are now offering mediclaim policies with cashless facility.

Overview of cashless mediclaim policy

Cashless mediclaim policy is an excellent solution to protect yourself against sky-rocketing medical expenses in the event of hospitalisation for an illness or due to an accident, without having to incur any out-of-pocket expenses. Basically, insurance companies are tied up with various hospitals across the country for the cashless facility which are referred to as ‘network hospitals’. On availing treatment at any of the network hospitals, medical bills will be directly settled to the hospital by insurance company. ‘Cashless mediclaim policy’ comes as a blessing in the event of medical emergencies by ensuring you complete financial security and peace of mind. When compared to reimbursement mediclaim policies where you pay medical bills first and then get them reimbursed from insurance company, cashless mediclaim is extremely beneficial in the time of need.

Types of cashless mediclaim policies in India:

You can safeguard your financial well-being and your health by investing in various types of cashless mediclaim policies available in India. Indian insurance market offers various types of mediclaim policies depending on the need of people. Following are the major types of cashless mediclaim policies available in India:

  1. Individual cashless mediclaim policy: Under individual cashless mediclaim policy, an individual is provided a specific amount of medical coverage for a specified period of time. The coverage offered can be claimed for hospitalisation expenses whenever the insured individual is in need of it.
  2. Family floater cashless mediclaim policy: Under Family floater cashless mediclaim policy, all members of the family are covered under a single policy with one fixed sum insured. The policy generally covers self, spouse and dependent children. Many policies even cover dependent parents and parents-in-law. The coverage provided under the policy can be utilised by any insured member of the family during the policy period for hospitalisation expenses.
  3. Senior citizen cashless mediclaim policy: Unique healthcare needs of old age people are covered under senior citizen cashless mediclaim policy. These policies are carefully crafted to take care of senior citizen’s hospitalisation expenses in the crucial stage of their life.

How to avail cashless mediclaim (planned /emergency)?

With the cashless facility offered by mediclaim policies, you don’t need to run around arranging for the funds in the time of medical emergencies. You can locate the nearest network hospital of your insurance company and avail the cashless mediclaim facility without having to incur any out-of-pocket cost, wherein insurer directly makes the payment of medical bills to the hospital.

Third party administrator (TPA) coordinates between hospital and the insurance company in the process of cashless mediclaim settlement. There will be insurance desk set up in every network hospital to help initiate the cashless claims. Cashless mediclaim services can be availed in two ways during hospitalisation:

Cashless claims for planned hospitalisation:

In the case of planned hospitalisation, you will have good enough time to choose your preferred hospital out of list of your insurer’s network hospitals for availing treatment. Following is the simple process to follow for availing cashless treatment in case of planned hospitalisation:

  1. Choose the network hospital by referring to your insurance company’s website for list of network hospitals or by calling up your insurer’s customer care
  2. Once you choose the hospital for your treatment, contact the hospital’s insurance desk and fill-up pre-authorisation cashless request form which can be downloaded online on TPA website or physical copy can be obtained from insurance desk at the hospital
  3. Submit the pre-authorisation cashless request within the time limit specified by your insurance company. Details filled in the request form will be verified and signed by the hospital authorities
  4. TPA/insurance desk will check the eligibility and authenticity of pre-authorisation cashless request submitted by you
  5. Upon verifying the request, TPA will either approve or reject the request placed
  6. Sanction letter will be issued to the hospital mentioning the amount approved
  7. On producing the final documents by hospital, payment of claim will be directly made to the hospital

Cashless claims for emergency hospitalisation:

In the case of a medical emergency that requires immediate medical care, cashless claim can be initiated after getting admitted at the nearest network hospital. Following is the simple process to follow for availing cashless treatment in case of emergency hospitalisation:

  1. Upon getting admitted at the nearest network hospital, show your policy document/card to the hospital. The document will contain necessary details like policy number, policy type and name of the insurance company etc.
  2. Contact insurance desk of the hospital and fill up pre-authorisation request form within 24 hours of hospitalisation
  3. Third party administrator/insurance company will review you pre-authorisation request and other documents submitted
  4. Once documents are verified, TPA will either approve or reject your cashless claim request. If the claim is approved, cashless treatment can be availed
  5. Once final set documents submitted by hospital are verified, claim amount will be directly settled with the network hospital

Reasons for claim rejection in cashless mediclaim policy:

Cashless insurance claims also can get rejected for various reasons. However, some of them can be avoided with a little care. Let’s take a look at the reasons for rejection of cashless claims.

  1. Unawareness of claim process:
    Sometimes not being aware of the claim process and not following the process diligently can lead to rejection of claims. For example, not following the time limit for placing the claim may become a reason for rejection. Filling up the wrong information in the form, not submitting the right documents etc. could lead to rejection of cashless claims. Knowing the claim process properly and taking help of insurance company’s customer support team for the information can help reduce such type of claim rejections.
  2. Pre-existing conditions:
    Pre-existing health conditions is one of the top reasons for rejection of cashless claims. Some of the pre-existing health conditions at the time of the policy are not covered under the cashless mediclaim policies temporarily for a certain period of time, which may vary from 24 months to 48 months. During this waiting period, expenses incurred for treatment of pre-existing illnesses are not covered by cashless mediclaim policies. Placing the claim for pre-existing medical conditions during the waiting period is one of the reasons for rejection of cashless claims.
  3. Non-disclosure of information:
    Holding back the information at the time of buying cashless mediclaim policy is one of the main reasons for claim rejections later. For example, not disclosing the details about a pre-existing health condition while purchasing the cashless mediclaim policy can become reason for claim rejection later.
  4. Exclusions:
    Though cashless mediclaim policies cover all the major hospitalisation expenses, policies do come with certain exclusions. For example, treatment expenses incurred for hospitalisation relating to sexually transmitted diseases, AIDS/HIV are not covered under cashless mediclaim policies. Claims cannot be raised for expenses that are permanently excluded from the policy. Claims raised for exclusions will lead to rejection of claims.
  5. Policy period:
    Cashless mediclaim policies are insurance contract for a specific period of time called policy period. Once the policy expires, coverage provided under the specific policy stands invalid. Any claim that is raised after the expiry of the policy period and before the renewal leads to rejection of claims.

Points to remember before buying cashless mediclaim policy:

Buying the ideal cashless mediclaim policy is a daunting task considering the huge variety of plans available in the market. To make a rational purchase, there are certain important points that you need to consider. Following are the important points to consider at the time of buying cashless mediclaim policy:

  1. Right coverage:
    Remember to choose the right amount of coverage for your cashless mediclaim policy keeping in mind the healthcare inflation. Having an adequate amount of coverage provides complete protection.
  2. Network hospitals:
    Ensuring your preferred hospitals are there in the list of your insurer’s network hospitals is really important to avail the timely cashless treatment. It’s good to go with insurance companies having wider network of hospitals. Wider network helps in getting timely medical care, quality treatment along with making it all the more convenient for you.
  3. Waiting period:
    Almost every cashless mediclaim policy comes with certain waiting period for treatment of pre-existing illnesses and for certain specific treatments and illnesses. During the waiting period you cannot make any claims for the treatment of such illnesses or medical conditions. It’s ideal to choose the policies that come with lesser waiting period. However, this may depend on your healthcare requirements and present health conditions.
  4. Renewability:
    Considering the difficulty in getting the mediclaim policies with increasing age, it’s always better to go with policies that offer lifelong renewability. Such policies can be renewed for lifetime without compromising on the coverage.
  5. Value adds:
    Though cashless mediclaim policies are primarily meant for covering hospitalisation expenses during illnesses and accidents, you can expect certain additional benefits under the policy such as free medical check-ups and maternity benefits etc. Depending on your requirement, avail policy with some value adds.
  6. Incurred claim ratio:
    Ratio of claims settled by the insurance company is an important consideration at the time of buying cashless mediclaim policy. Insurance company with high claim settlement ratio ensures that your claims are settled quickly and conveniently without any hassles.
  7. Cost:
    Though buying decision cannot just be based on cost of cashless mediclaim policy, exorbitant premiums may hit your yearly budget. Hence, consider plans that can provide you much needed coverage within your affordability range.

Cashless mediclaim policy is an amazing solution to safeguard your financial well-being in the event of medical emergencies. Cashless facility helps you avail quality medical treatment at the right time. You can buy cashless mediclaim policy on Turtlemint by comparing various plans side by side based on various parameters and choose the right one for you.

Frequently Asked Questions (FAQ’s)

  1. What are the factors that affect cashless mediclaim policy’s premium?

    Mediclaim insurance premiums are determined based on numerous factors. Following are some of the important factors that affect your cashless mediclaim policy’s premium:

    • Age
    • Pre-existing medical conditions
    • Habits such as alcohol and drug abuse
    • Family health history
    • Profession
    • Marital status, etc.
  1. What is ‘free look period’ in cashless mediclaim policy?

    Free look period in cashless mediclaim policy refers to time given to new policyholders to understand the terms and conditions of the policy and terminate the policy without penalties, in case he/she is not satisfied with the terms and conditions of the policy. Usually, most of the cashless mediclaim policies come with 15 days free look period within which policy can be cancelled without penalties. However, it’s important to state the reason for cancellation.

  1. What are the tax benefits of cashless mediclaim policy?

    Premiums paid towards cashless mediclaim plans can be claimed as a tax deduction under Section 80D of the Income Tax Act, 1961. Tax deduction can be availed on premiums paid towards health insurance plans taken for self, spouse, children and parents.

    Following are the details –

    DescriptionUpper limit on premium for self, spouse and dependent childrenUpper limit on premium for parents (dependent/non-dependent)Total deductions available 
    All members of the family < 60 years of ageINR 25,000INR 25,000INR 50,000
    Self, spouse and children < 60 years age

    Either of the parents > 60 years age

    		INR 25,000INR 50,000INR 75,000
    Self > 60 years age

    Spouse and children < 60 years of age

    Parents > 60 years age

    		INR 50,000INR 50,000INR 1,00,000
  1. Can I have more than one cashless mediclaim policy?

    Yes. You can have more than one cashless mediclaim policy.

Complete Guide on ULIP: Detailed List of the Best ULIP Plans in India

Sidharth Hampanavar

Unit Linked Insurance Plans or ULIP, as it is popularly known is a unique financial product which was introduced in the insurance industry as a major improvement over its traditional endowment policies. ULIP was first introduced by UTI (Unit Trust of India), Mutual Fund. Later, in 2005 when the Insurance Regulatory and Development Authority of India (IRDAI) laid down guidelines for ULIP, many insurance companies forayed into ULIP business. In this article, let’s learn about ULIPs in detail.

What is ULIP?

ULIP is an integrated financial product that offers the best of both the worlds – insurance and investment. Basically, ULIP or Unit Linked Insurance Plan is a hybrid product offered by insurance companies that provides the dual benefit of protection and capital appreciation. Being a market-linked investment product, ULIP gives its investors opportunities to earn from capital market. ULIP is structured differently when compared to other insurance products offered by the insurance providers. Let’s understand how ULIPs are structured and how do they work.

How does a ULIP Plan work?

ULIP or Unit Linked Insurance Plan is market-linked. It is structured to provide the benefit of both risk cover and wealth creation by earning a return on market investment. When you invest in ULIP, an insurance plan, you will make premium payment as specified by the product or plan. The amount invested in the form of the premium is adjusted for the relevant charges, which are stated beforehand. After this, a part of the net premium will be put aside for providing life cover (which is also deducted as mortality charges) and the other part will be invested in the capital market through funds comprising of equity, debt and money market instruments in varying proportion. Depending upon the plan variants and fund choices made available by the ULIP plan, you can make your investments keeping in mind your risk profile. Every fund will have a risk rating. ULIP plans come with a lock-in period of 5 years.

When it comes to ‘investment’ part ULIP pools investors (policyholders) money and invest them into funds chosen by them. The total corpus of the funds is divided into units and the units will be allocated to each policyholder in the proportion of an invested amount. Depending on the funds market performance, it’s a per-unit value (net asset value) will increase or decrease.

On maturity of the ULIP plan, the investor will receive the fund value on the date of maturity. The fund value is the total value of all the fund units across all the investment funds opted in the policy. In case, investor dies during the policy period, then the nominee designated in the policy or the beneficiary of the policy will get the higher of the following amount:

  • Fund value on the date of demise
  • Sum assured (pre-agreed)
  • 105% of total premiums paid till the date of demise

There is also a class of ULIPs that offer both fund value + sum assured as a death benefit.

For example, let’s say Mr Arun has taken ULIP plan for 15 years with INR 5 lakhs sum assured and he is been paying INR 50,000 every year. In this case, let’s say unfortunately Arun dies in the 6th year of the policy. He has paid 50,000X 6 = INR 3, 50,000 premium amount. Let’s assume fund value on the date of his demise is INR 4, 20,000. His nominee would receive INR 5, 00,000 (sum assured) which is higher of all. In case the ULIP had offered a double death benefit, then the nominee would receive INR. 4, 20,000 + INR 5, 00,000 = INR 9, 20,000 as death benefit.

Who can invest in ULIP Plan?

Though ULIP offers flexibility to the investor, it is primarily a long-term investment product. ULIPs do not come with a high-risk cover. ULIP is ideal for investors of any risk profile and also Individuals seeking additional insurance cover along with market investment opportunities. ULIP invests in the capital market and the degree of risk may depend on the fund chosen by the investor. However, the investor has convenience and flexibility to choose based on the risk profile and on the basis of specific financial goals. ULIP investments are ideal for any investor irrespective of the risk-taking ability starting from conservative to aggressive risk profile. ULIPs are suitable for investors with any medium and long-term financial goals such as retirement, higher education or dream vacation etc. In short, ULIP plans are suitable for:

  • Investors having medium-term and long-term horizons for investment
  • Investors of any risk profile
  • Investors of all age across all life stage
  • Investors seeking risk cover along with an investment
  • Investors who would like to monitor their investments closely.

What are the Benefits of Unit Linked Insurance Plans?

Let’s explore the various benefits of ULIP plans. Following are some of them:

  1. Transparency:

    ULIP offers transparency to its investors relating to charge structure, expected rate of return and fund choices for investment etc. All the information are included in the fine prints of the policy which can be understood beforehand before signing on the dotted lines. Clarity and transparency give the confidence to investors that their hard-earned money invested in an ideal way. Timely reports shared by the insurance company to the investors regarding their investment gives an update on the current status of the investment.

  2. Flexibility:

    ULIPs come with many fund options with varying degree of risk. Investors are given the flexibility to choose an appropriate fund for investment based on their risk profile, goal and need. Investors are also allowed to switch from one fund option to another depending on the change in need and market situation. There is also a flexibility to increase the amount of investment via top-ups.

  3. Liquidity:

    After the initial five years, ULIPs gives liquidity by allowing investors to withdraw partially from the investment fund.

  4. Protection:

    Primarily being an insurance product, ULIP offers risk protection to the policyholder or person insured. On the death of the policyholder during the ULIP policy tenure, higher of the sum assured or fund value is paid as death benefits.

  5. Goal-based investment:

    ULIP is a goal-based investment wherein the main goal is long-term wealth creation through maximising returns from investment into the capital market. ULIPs helps the investor to build a corpus for their future goals such as retirement, children’s higher education, wedding and any big purchase etc

  6. Disciplined investment approach:

    ULIP inculcates the habit of disciplined investing in investors as the investment is done every year into the policy to yield good returns over the long-run.

  7. Diversification:

    ULIP offers a choice of diversification as it allows investors to invest in various financial instruments of the capital market. Investors are allowed to choose the funds in varying proportion for investment depending on the individual investor’s need and goal.

  8. Customisation:

    ULIP plans are customisable according to each individuals investing style, protection needs, goals and risk profile. There are various additional benefits are offered in the form of optional riders such as critical illness rider, accidental disability rider and waiver of premium rider. Individuals can customize the plan based on their need.

  9. Tax Benefit:

    ULIP is the most tax-efficient financial product that offers EEE benefits. Under the Income Tax Act, 1961, you can get below benefits by investing in ULIP plans:

    • Annual premiums paid towards ULIP investment is eligible for a tax deduction as per Section 80C of the IT Act that is up to the total limit of INR. 1.5 lakhs
    • There is no tax applicable on switches from one fund to another throughout the policy tenure.
    • Lump-sum paid on death or on maturity is also tax-free under Section 10(10D) of the insurance Act.

Best ULIP Plans in India:

There are numerous ULIP plans available in Indian Insurance market. Choosing the best plan would depend on each individual’s unique requirements in terms of risk appetite, future goals and need. We have listed down some of the best ULIP plans below.

ULIP Plan NameEntry AgeMinimum PremiumPremium Allocation ChargesPolicy Administration ChargesFree Switches (Annual)
HDFC Life Click 2 Wealth Plan30 days to 60 yearsFor regular pay – INR 1,000 to INR 12,000 For single pay – 24,000NilNilUnlimited
MetLife Smart Platinum Plan7 years to 70 yearsINR 30,000 to INR 60,000Up to a maximum of 1.25% per annumMaximum of up to INR 40 per month4
Max Life Fast Track Super Plan18 years to 50 yearsINR 25,000 to INR 1,00,0002% for single premium policies 4% for regular annual premium policiesINR 1,500 per year12
SBI Life – Smart Wealth Assure Plan8 years to 65 yearsINR 50,0003% of single premiumINR 45 per month2
Bajaj Allianz Future Gain Plan1 year to 60 yearsINR 3,000 to INR 36,0000% to 1.5%INR 33.33 per monthUnlimited
ICICI Pru Wealth Builder II Plan0 years to 69 yearsINR 24,000 to INR 48,0003% to 4%INR 500 per monthNA
Aegon Life iMaximize Plan7 years to 55 yearsINR 24,000 to INR 36,000NilINR 100 per month4
Tata AIA Life Invest Assure II Plan4 years to 55 yearsINR 75,000 to INR 1,20,0005% of the annual premium0.25% of the annual premium12
HDFC Life Pro Growth Plus Plan14 years to 65 yearsINR 2,500 to INR 10,0002.5% of the annual premiumMaximum of INR 500 per monthUnlimited
LIC Market Plus- I Plan18 years to 65 yearsINR 5,000 to INR 30,0000.033Maximum of INR 60 per month4

How to Choose Best ULIP Plans?

Getting the best possible returns are of any investors dream. ULIPs can be a great choice to maximise your returns and create wealth over the long-run for meeting your life goals. As the product is structured uniquely to provide the triple benefit of life protection, wealth creation along with tax efficiency, ULIPs can be an ideal choice for investors of any risk profile and at any life stage. However, there are certain things to consider to make the best choice among a plethora of ULIP plan options available in the market. Following are the things to keep in mind to choose the best ULIP plans:

  1. Take the right amount of life protection:

    ULIPs being the insurance products secures your family by offering life cover. It is ensured that your loved ones are financially secure even when you are not around. 10 times of your ULIP premium can be availed as minimum life cover. Along with pure protection plans that you already have, you can get some additional coverage through ULIP investments. It’s important to access your coverage requirement before you make an investment so that you are adequately covered.

  2. Define your investment goals:

    You need to plan your investments carefully to achieve your life goals. Be it your life after retirement or your child’s dream of becoming a doctor or buying your dream, every life event needs to be planned carefully. It’s important to define your goals and start making investments accordingly as you get the clarity on time horizon and the approximate funds you need to meet the goals. You can choose the ULIP plan that suits your goal in every parameter.

  3. Know your risk appetite and choose funds accordingly:

    Risk-taking ability is the crucial element to be considered at the time of making ULIP investments that are market-linked. Higher the risk higher is the return. Also, at a young age, one can afford to take relatively more risk. To be aware of the risk appetite is important to choose the best suitable ULIP and to choose the best suitable investment fund. There is also fund switch options offered by ULIP plans. Consider the number of free switches available so that you can switch from one fund to another depending on the market condition and your changing needs.

  4. Consider fund performance and financial stability of the insurer:

    While choosing the ULIP plan, check the fund performances of the ULIP you have chosen. Specifically, the consistency of fund performance is what needs to be checked to understand how the fund responds to market swings. Though the past performances are not the indications of future performance, it gives you an idea on what to expect. Likewise, it’s important to consider the financial soundness and stability of the insurance provider while choosing ULIP by looking at the solvency ratio.

  5. Compare on the cost-benefit basis:

    ULIPs come in various types and with attractive features and benefits such as riders, top-ups and many more. It’s important to compare the features of various ULIPs alongside their cost can help you make a wise buying decision.

Key Features of ULIP Plan:

ULIP provides life protection along with an opportunity to grow your wealth. The ULIP plan comes with numerous attractive features. Key features of ULIP are:

  1. Investment fund switch:

    ULIP plan comes with many fund choices such as equity, debt or balanced funds. An investor can choose the fund of his/her choice. Later, during the policy term, the investor is allowed to switch from one fund option to another.

  2. Lock-in period:

    ULIPs come with a mandatory lock-in period of 5 years. ULIP can only be withdrawn after completion of these 5 years of the lock-in period. However, there will be surrender and discontinuation charges levied for the same.

  3. Premium redirection:

    ULIP also provides an option to redirect your future premiums to a different fund which is other than the base fund chosen by you.

  4. Top-up facility:

    ULIP allows you to increase the investment amount at any point in time during the policy term with the top-up facility.

  5. Partial withdrawal:

    ULIP comes with a flexible option of partial withdrawal to meet your emergency liquidity requirement. Part of your fund value can be withdrawn based on the terms and conditions of the policy.

Types of ULIP Plans in India:

ULIP plans can be categorised on the basis of death benefits, the purpose of investment and fund options.

Types of ULIPs on the basis of death benefits:

  1. Type I ULIP: In this, on the demise of the policyholder, the policy pays higher of fund value or sum assured as a death benefit to the nominee.
  2. Type II ULIP: In this, on the demise of the policyholder, the policy pays the sum assured + fund value as the death benefit to the nominee.

Types of ULIPs on the basis of purpose:

  1. ULIP for Wealth creation:

    This plan is particularly meant for building a corpus over the period of time. Young people in their early years of career can start investing in these plans to create wealth for the future. Here are some of the ULIPs for wealth creation

    2. ULIP Plan NameEntry AgeMinimum PremiumPremium Allocation ChargesPolicy Administration ChargesFree Switches (Annual)
    HDFC Life Click 2 Wealth Plan30 days to 60 yearsFor regular pay – INR 1,000 to INR 12,000 For single pay – 24,000NilNilUnlimited
    ICICI Pru Wealth Builder II Plan0 years to 69 years Maximum – no limitINR 24,000 to INR 48,0003% to 4%3INR 500 per monthNA
    SBI Life – eWealth insurance Plan18 years to 50 yearsINR 10,000 onwardsNilNANA
    Max Life Online Savings Plan18 years to 60 yearsINR 36,000 annuallyNilNilUnlimited

  1. ULIP for Retirement planning:

    Planning for retirement life is very crucial. This plan specifically makes an investment for retirement life which will later be invested in annuities and paid out as regular pension. Here are some ULIPs for retirement:

    2. ULIP Plan NameEntry AgeMinimum PremiumPremium Allocation ChargesPolicy Administration ChargesFree Switches (Annual)
    HDFC Click 2 Wealth with Golden Years Benefit Plan0 to 60 yearsINR 1,000 to INR 24,000 annuallyNilNilUnlimited
    ICICI Pru Easy Retire Plan35 years to 70 yearsINR 48,000Up to 6%Maximum of INR 500 per month or INR 6,000 annually4
    Max Life Online Savings Plan18 years to 60 yearsINR 36,000 annuallyNilNilUnlimited
    Bajaj Allianz Life-Long Goal PlanNo age limitINR 5,000 to INR 60,000Up to 6% for offline plans Nil for online plansNilUnlimited

  1. ULIP for the Higher education of children:

    There are ULIPs specially crafted for meeting children education requirement. These plans secure your child’s future education even when you are not around. ULIP child plans come with in-built Waiver of Premium (WoP) option. Here are some of the ULIP child plans

    2. ULIP Plan NameEntry AgeMinimum PremiumPremium Allocation ChargesPolicy Administration ChargesFree Switches (Annual)
    HDFC Click 2 Wealth with0 to 60 yearsINR 1,000 to INR 12,000 annuallyNilNilUnlimited
    Premium waiver Benefit Plan
    ICICI Pru Smart Kid Plan20 years to 54 yearsINR 45,000 to INR 5,00,000Single pay -3% Regular pay – 2% to 6%Maximum of INR 500 per month or INR 6,000 annually4
    Max Life Online Savings Plan with premium waiver option Plan18 years to 54 yearsINR 3,000 to INR 36,000 annuallyNilNilUnlimited
    Bajaj Allianz Future Gain with premium waiver benefit Plan1 year to 60 yearsINR 2,500 to INR 25,0002%INR 33.33 per month (increasing at 5% per annum)Unlimited

On the basis of investment funds:

Following are the ULIPs based on fund choices and risk category

  1. Equity funds:

    These are high-risk ULIP scheme that invests the majority of your premium into equity-based funds.

  1. Balanced funds:

    These are moderate risky ULIP schemes that invest your premium into balanced funds that strike a balance between debt instruments and equity.

  1. Debt funds:

    These are low-risk ULIP schemes that invest your premium majorly into debt funds that comprise of bonds and debt instruments.

Reason to Invest in ULIPs:

ULIP investment come with numerous benefits. Individuals of any life stage with any risk profile can consider ULIP for their long-term financial goals. Some of the important reasons to invest in ULIPs are as follows:

  1. To maximise returns:

    ULIPs are market-linked products, wherein you can choose to invest in different financial instruments through fund choices available. Based on your risk profile, you can choose to invest in an equity fund, debt fund, balanced fund or cash fund. Depending on your choice of fund and the risk category, your returns will vary. You are also allowed to switch from one fund another during the policy term. As the investment is market-driven, there is an opportunity to maximise your returns based on stock market performance.

  1. For life protection:

    As ULIPs are combination products, life protection is primarily offered along with an investment element. With the death benefits, ULIP assures the family of assured/investor is financially stable even when the assured is no longer around in this world.

  1. To achieve long-term financial goals:

    Investments into the capital market through ULIP can earn better over the long-term and help the investor to achieve many long-term goals such as retirement, higher education and marriage etc.

  1. For tax benefits:

    Besides every other benefit, the tax benefit is eye-catching for many. ULIPs help in a great way to reduce tax outgo as the premium paid qualifies for tax deduction under section 80C of the Income Tax Act, 1961. The best part is investing in ULIP is a tax-efficient option as it also provides the benefit of Section 10 (10D) of the Income Tax Act, 1961.

ULIP strikes a good balance between insurance and investment. Secure your family, maximise your returns and achieve your long-term financial goals.

Types of ULIP Charges:

ULIPs involve various types of charges details of which are clearly disclosed and stated in every ULIP’s policy document. Earlier, ULIPs were known to be of high-cost products in terms of charges. However, with the change in ULIP related regulations by the Insurance Regulator and Development Authority (IRDAI), revamped online ULIPs are considered to be cost-effective investments. Structure of charges may vary among insurance companies and plans. Let’s take a look at various charges that are levied in a ULIP plan.

  1. Premium allocation charges:

    Premium allocation charges is deducted as a fixed percentage of your ULIP premium. These charges are deducted before the allocation of investment units. Premium allocation charges include commission expenses, renewal expenses etc.

    For example, Premium collected on a ULIP plan is INR 1 lakh. Let’s say premium allocation charges for the first year is 5% of the premium received. Then, INR 5,000 will be deducted from the premium collected and the remaining INR 95,000 will be allocated to funds chosen by you.

    Premium allocation charges are front-loaded which are deducted beforehand every year when you make a premium payment, including renewal premium payments. However, these charges are more in the initial years and will reduce over the policy years. There are many ULIPs, more specifically online plans that are not levying any premium allocation charges also. Premium allocation charges may also vary depending on the premium type (single or regular) and mode of premium payments such as yearly, half-yearly, quarterly and monthly.

  1. Fund management charges:

    Fund management charges are levied as ULIP investments are made into various investment funds which need to be managed. Fund management charges are adjusted on a daily basis from net asset value (NAV) of the fund before arriving at it. The maximum fund management charges allowed for deduction is 1.35% per annum of the fund value. Fund management charges are usually more in equity funds than debt or balanced funds.

  1. Mortality charges:

    Basically, mortality charges are the cost of life insurance coverage under the ULIP plan. These charges may depend on various factors such as the amount of sum assured, age of the assured, health history and many more. Mortality charges are deducted on a monthly basis. Charges will be deducted proportionately from each fund you have chosen for investment by cancelling the units.

  1. Partial withdrawal charges:

    ULIP plans allow partial withdrawal of funds after the completion of the lock-in period of 5 years. Some of the policies will restrict the number of partial withdrawals to limited numbers such as 3 or 4. Some ULIP plans may allow unlimited partial withdrawals. However, after a limited number of withdrawals, ULIP plan may charge you for further withdrawals which are called partial withdrawal charges. Usually, partial withdrawal charges are flat fees.

  1. Switching charges:

    ULIP offers an excellent feature of fund switching. The plan allows you to switch from one investment fund to another depending on your investment need and market conditions. Generally, the number of switches allowed are limited to a certain number in some ULIP plans. Some plans may offer unlimited free switches. ULIP plans with limited switches charges you for additional fund switches that you make during the policy term. Switching charges may vary from INR 100 to INR 250 per switch depending on the ULIP plan or the insurance company.

  1. Premium redirection charges:

    Usually in a ULIP plan, in the beginning, you will choose a fund for your investment. And your further premiums are invested into the same funds. However, ULIP offers a feature called premium redirection wherein, you can redirect your future premium payments into a different fund. For example, you have chosen investment fund A and your future premiums can be redirected to fund B. Premium redirection can be done in limited numbers only. Premium redirection charges may vary from INR 100 to INR 250 per switch depending on the ULIP plan or the insurance company.

  1. Discontinuance charge:

    ULIPs come with a lock-in period of five years. If you discontinue premium payment within the lock-in period, your money will be locked in a discontinued fund. The same is applicable for the surrender of policy within the lock-in period also. These charges are pre-decided by IRDAI and are same almost cross all ULIP Plans.

  1. Policy administration charges:

    There are charges deducted to maintain your ULIP policy which is known as policy administration charges. Policy administration includes premium intimation, revival notice, documentation and many more. A flat amount is charges as policy administration charges.

  1. Miscellaneous charges:

    Miscellaneous charges in ULIP are of a smaller amount. This can be related to changing the premium payment mode or any other charges incurred.

ULIP Investment Myths Debunked

Let’s try to debunk certain myths relating to ULIP

Myth 1: ULIPs are high-cost products

Truth: ULIPs are not high-cost products, specifically after the change in regulations by the Insurance Regulatory and Development Authority of India (IRDAI) in 2010. The regulator has capped ULIP charges at 3% of gross yield for ULIP plans if the policyholder stays invested up to 10 years and 2.25% if the policyholder continues to stay invested for more than 10 years. Hence, the front load has reduced which mainly comprises of commission. Online ULIP plans are more cost-effective plans as the charges are relatively less.

Myth 2: ULIPs are high-risk investments as they are market-linked

Truth: ULIP offers you to select an investment fund based on your risk appetite. There are various investment funds offered by ULIP comprising of equity funds, debt fund and balanced funds or combination of all of these funds. Many ULIP plans offer eight to nine types of funds suitable for varying risk categories. ULIPs are suitable for conservative to aggressive investors.

Myth 3: ULIP is not a good investment choice

Truth: ULIP is an ideal investment option for all type of investors irrespective of their risk appetite and life phase. ULIPs are available for various long-term goals such as for retirement, child education and wealth creation etc. Depending on your risk profile, goal and purpose you can choose the investment fund. According to your changing needs, you can switch from one fund to another fund also. In short, ULIPs are excellent products to build wealth over long-run with the benefit of customisation, flexibility, transparency and many more such benefits.

Myth 4: ULIPs are illiquid as they are long-term products

Truth: ULIPs offer liquidity in the form of partial withdrawals after 5 years of the lock-in period. During an emergency, you can withdraw a part of ULIP funds to meet the urgent liquidity requirements.

Myth 5: ULIPs cannot be surrendered during the policy period

Truth: ULIP plan can be surrendered after completion of the lock-in period of five years. Before which if you discontinue, certain charges will be deducted and the fund amount will be parked in discontinuance fund and the payout will be made after completion of five years. However, to reap the benefit of your investment it is advisable to stay invested throughout the policy period. The benefit of compounding and the benefit of the change in the market cycle can be experienced only if you stay invested for long.

Myth 6: Life cover in ULIP is impacted by market volatility

Truth: Sum assured or life cover in ULIP plan is unchanged throughout the policy period irrespective of the market volatility. Though the performance of your investment is linked to the capital market, the life cover will remain unaffected by the market volatility.

Myth 7: ULIP does not allow investment of surplus funds

Truth: ULIPs offer the top-up facility wherein you can invest surplus funds over and above your regular premium investments that you are making into the policy. Tax benefit can also be enjoyed on the top-up investments that you make.

Frequently Asked Questions (FAQs)

  1. What are the eligibility conditions to invest in ULIP plans?

    To invest in ULIP plans you must meet the following eligibility requirement

    • You need to meet the entry age criteria (both minimum and maximum)
    • You need to meet the age criteria, which is below the maximum maturity age while exiting a ULIP plan.
    • You must adhere to the plan’s terms and conditions relating to premium payment mode and term.
  1. What are the documents required to invest in ULIP?

    Following are the documents required for investing in ULIP:

    • Identity proof: PAN card, Voter’s ID, Aadhaar card, passport etc
    • Address proof: Aadhaar Card, Voter’s ID, Passport, Driving license, utility bills
    • Income proof: Income tax returns, bank statements, salary slips
    • Age proof: Birth certificate, Aadhaar card, Passport, Driving license etc
  1. Can ULIP be revived after discontinuation of premium?

    Yes ULIP can be revived within a revival period which is usually two years from the date of last premium payment.

  1. Is there a grace period given for premium payments in ULIP?

    Yes. Usually, ULIPs provide 15 days to 30 days of grace period for making the premium payment.

  1. Can investment in ULIP plan be cancelled after buying?

    Yes. Investment in a ULIP plan can be cancelled within the free look period with the reason stated. Usually, 15 days to a maximum of 30 days are given as free look period during which you can cancel your investment in ULIP plan without charges if you are not satisfied with the terms and conditions of the policy. However, it can be done with reasons stated for rejection.

Employee Pension Scheme – Complete Guide on Eligibility, Features & more!

Sidharth Hampanavar

Creating a source of income after retirement is important so that you can continue your lifestyle undisturbed without making any financial compromise. In fact, if you have amassed a retirement corpus, you can fulfil your life dreams once you are free from other financial liabilities. Given the importance of a retirement fund, the Employees’ Provident Fund Organisation (EPFO) introduced the Employees’ Provident Fund (EPF) Scheme. Later on, in the year 1995, the Employee Pension Scheme (EPS) was also launched to ensure that you receive a lifelong pension after you retire. While many of you are familiar with the concept of EPF, the Employee Pension Scheme is not studied in detail. So, let’s understand what the scheme is all about –

What is the Employee Pension Scheme?

Employee Pension Scheme is a scheme of pension for employees working in the organized sector. As per the provisions of the EPF Act, 12% of your basic salary is invested in the EPF Account. Your employer also contributes an equal amount to the EPF Account.

However, from the employer’s share of contribution, 8.33% of the contribution is invested in Employee Pension Scheme and the remaining is invested in the EPF Account. Thereafter, after you attain 58 years of age, the balance accumulated in the Employee Pension Scheme is used to pay you lifelong annuities. Thus, while EPF Account creates a retirement corpus, Employee Pension Scheme ensures that you get annuities after you retire.

Features of the Employee Pension Scheme

Under the Employee Pension Scheme, the following features are notable –

  1. Only a part of the employer’s contribution is directed towards the EPS scheme. Your contribution is entirely invested in the EPF Account
  2. There is a limit on the investment which can be done towards the Employee Pension Scheme. This limit is lower of INR 1250/month or 8.33% of the employer’s contribution to the EPF Account
  3. Investment in the scheme continues till you reach 58 years of age
  4. You can start receiving a reduced pension amount after you reach 50 years of age
  5. You can also postpone the date of receiving annuities. Deferment is allowed for two years till you reach 60 years of age. If you defer receiving pensions, you get an additional interest rate of 4% on the pension amount
  6. Besides the employer’s contribution, the Government also contributes 1.16% of your monthly salary towards your EPS account

Who is eligible to join the Employee Pension Scheme?

You can join the EPS scheme if you fulfil the below-mentioned criteria –

  1. You should be a member of EPFO
  2. You should have worked for a minimum of 10 years even though the service was not continuous
  3. You should attain 58 years of age to qualify to receive annuities

 

Difference between EPF and EPS

 

Many of you confuse EPF with EPS but both these concepts are different from one another. Let’s understand how –

EPFEPS
EPF aims to create a retirement corpus for you after you retireEPS aims to create a source of regular income through pensions after you retire
You and your employer both contribute towards the EPF schemeOnly your employer contributes towards the EPS scheme
You contribute 12% of your basic salary including dearness allowance towards EPF while your employer contributes 3.67% of your pay towards EPFEmployer’s contribution to the EPS scheme is 8.33% of your basic salary including dearness allowance
There is no limit to the EPF contribution. You can also contribute additional amounts to your EPF account if you wantEPS contributions are limited to INR 1250 per month even if the amount is below 8.33% of your basic pay
Partial withdrawals are allowed from the EPF AccountPartial withdrawals are not allowed from EPS

Calculation of pension amount under EPS

If you are wondering how much pension you would be able to receive under the Employee Pension Scheme, stop wondering. The amount of pension that you can receive can be calculated. There are two types of calculations for calculating the monthly pension depending on the period when you joined the EPS scheme. These are as follows –

  1. Calculation # 1 – If you have joined EPS scheme before 16th November 1995If you joined employment before 16th November 1995 and became a member of the EPS scheme, your pension would depend on your salary and the number of years of service that you have completed. The pension amount is fixed and is as follows –
    Completed years of serviceMonthly pension if the salary is up to INR 2500/monthMonthly pension if the salary is above INR 2500/month
    10 yearsINR 80INR 85
    11-15 yearsINR 95INR 105
    15-20 yearsINR 120INR 135
    More than 20 yearsINR 150INR 170
  1. Calculation #2 – If you have joined the EPS scheme after 16th November 1995In case you became an EPS member after 16th November 1995, the monthly pension amount would be different. It would be calculated based on a formula which is as follows –

    Amount of monthly pension = (pensionable salary * pensionable service) / 70

    In this formula, the concepts of pensionable salary and service are defined below:

    1. Monthly Pensionable SalaryThe monthly pensionable salary is defined as the average monthly salary in the last 12 months of exiting the Employee Pension Scheme. The maximum pensionable salary per month would be restricted to INR 15,000 so that the employer’s contribution does not exceed INR 1250 (8.33% of INR 15,000 is INR 1250). Moreover, if, over the last year, there are some days for which you do not receive a salary, the proportionate salary of those days would be added to the monthly income when calculating the average. For instance, suppose you join work on the 15th of the month. In that case, for that month, you would receive only half the salary. However, the full months’ salary would be considered when calculating the pensionable salary.
    2. Pensionable serviceThe total period over which you have worked is considered to be your pensionable service. Even if you have changed jobs, the completed duration at each employer would be added to get the pensionable service duration. The total duration would be rounded off to the nearest year if the aggregate also includes months. So, if your total work duration is 12 years and 4 months, the pensionable service would be 12 years. But, if the duration is 12 years 6 months or above, the pensionable service would be 13 years. You also get a bonus of two years if you have completed 20 years of service. So, if you have 20 or more service years under your belt, an additional two years would be added to your pensionable service. However, if you have not completed 10 years of service and you withdraw the EPS corpus completely when you change jobs, the EPS contribution would become zero. Moreover, your service duration would also be started from zero even though you have worked before withdrawing the EPS amount.

When is a pension payable under Employee Pension Scheme?

The sole purpose of contributing to the Employee Pension Scheme is to provide you with pensions. So, when it is time for you to receive pensions, you should know when you can avail pensions.

There are different scenarios when you can avail pension. Let’s understand the scenarios in details –

  1. When you retire after attaining 58 years of age:After you attain 58 years of age and if you have provided a total of 10 years of service, you become eligible to receive pensions under the Employee Pension Scheme. To receive the pension you would have to fill up Form 10D to start availing pensions every month. The form can be filled using an EPS Scheme Certificate which is generated when you attain 58 years of age.
  1. When you retire after attaining 58 years of age but you have not completed 10 years of service:If you have attained 58 years of age but your aggregate years of service is below 58 years, you would not become eligible to receive monthly pensions under the Employee Pension Scheme. In that case, you can withdraw the accumulated corpus in the EPS scheme by filling up Form 10C.
  1. If you suffer from total disability during active working years:If you suffer from a permanent and total disability before attaining 58 years of age, you qualify to receive monthly pensions whether or not you have completed 10 years of service. In that case, you would receive pensions from the date of your disablement and the pension would continue throughout your life. Your employer should have deposited at least one month’s contribution to the EPS account for the pension to start. Moreover, you would also have to undergo a medical check-up to certify that you are unfit to continue working.
  1. If you suffer from total disability during active working years:The Employee Pension Scheme doubles up as a family pension scheme because it provides your family with pensions in case of your death.

Pensions are payable in the following cases –

  1. If you die in working age and your employer has contributed at least one month’s amount to the EPS scheme
  2. If you have completed 10 years of service but die before reaching 58 years of age
  3. If you have started availing monthly pensions at 58 years of age and then you die

Different types of pensions available in India:

Different types of pensions are payable under the Employee Pension Scheme. These are as follows:

  1. Widow pension

    Also called Vridha Pension, widow pension is the pension payable to the widow of an eligible EPS member. The pension is payable to the widow throughout her life. However, in the case of remarriage, the pension would stop when the widow is remarried. If there is more than one widow, the pension would be payable to the eldest. The minimum amount of pension is INR 1000. The pension amount is calculated as follows –

    Monthly pensionable salary in case of widow pension

    Amount of widow pension

    INR 6200

    INR 2021

    INR 6250

    INR 2026

    INR 6300

    INR 2031

    INR 6350

    INR 2036

    INR 6400

    INR 2041

    INR 6450

    INR 2046

    INR 6500

    INR 2051

    These are the sample rates. However, recently, the monthly pensionable salary has been increased to INR 15,000 from the earlier INR 6500. As such, the amount of widow pension in current times is higher.

  2. Child pension

    In case of death of the member, along with widow pension, a monthly pension is also payable for the dependent children of the member if they are below 25 years of age. The amount of pension is calculated as 25% of the widow pension per child and it is paid for a maximum of two dependent children. Moreover, the pension is payable until the child/children attain 25 years of age.

  3. Orphan pension

    If the EPS member dies and there is no surviving widow but children, an orphan pension would be payable for the surviving child/children. The pension would be payable for a maximum of two children and the amount would be 75% of the applicable widow pension.

  4. Reduced pension

    If you have completed 10 years of service and have attained 50 years of age, you can choose to start receiving pensions before reaching 58 years of age. If you do so, you get pensions at a reduced rate. The rate of pension is calculated as follows –

    Reduced rate = [100 – 2(58 – age from which you choose to receive pension)]

    So, if you want to receive pensions from 52 years of age, the rate of pension would be 88% which is calculated as [100 – 2 (58 – 52)]

Different types of pension forms under EPS:

In order to start receiving monthly pensions under the Employee Pension Scheme, you would need to fill and submit some forms to the EPFO. These forms and their purpose are as follows –

Types of forms

Purpose 

To be submitted by

Form 10C

  • To withdraw the accumulated money in the EPS corpus before completing 10 years of service
  • To avail EPS Scheme Certificate

EPS member

Form 10D

  • To avail pension after reaching 50 years of age
  • To receive widow pension
  • To receive child pension
  • To receive an orphan pension

EPS member/nominee/widow/children

Life Certificate

  • To certify that you are alive
  • The form is to be submitted annually in November to your bank’s manager from where your pension account is being operated 

EPS pensioner or guardian

Non-remarriage Certificate

  • To certify that the widow has not married
  • The form is to be submitted annually in November

Widow of EPS member

Form 11

  • To provide bank account and Aadhar card details to EPFO
  • After the UAN has been activated, you should provide a cheque of your active bank account. The cheque should contain your name, IFSC code of the bank branch and your bank account number

EPS member

Checking the balance in the EPS account

A part of your employer’s contribution is invested in the Employee Pension Scheme and you get a pension from the accumulated corpus. If during your active working life, you want to check the accumulated corpus till date, you can do so through your EPF passbook. The last column in the passbook shows the pension contribution done by your employer. You can download the passbook in soft copy through the link https://passbook.epfindia.gov.in/MemberPassBook/Login. To download, you have to enter your UAN number and password. 

Top #4 Things to remember about EPS contributions:

Here are some important points about EPS contributions which you should keep in mind –

  1. The contribution should be made by the employer within 15 days from the end of a month
  2. The administrative costs associated with EPS contributions would be borne by your employer
  3. If you are unemployed for a continuous period of two months and you have completed at least 6 months’ service, you can withdraw the entire EPS corpus even if you have not completed 10 years of service
  4. The contribution would be calculated on the basic salary plus dearness allowance 

Why should you opt for EPS?

Given other retirement oriented investment avenues available in the market, you might feel why choose EPS. Well, for starters, you have no choice in the matter. Your employer has to contribute part of your salary towards an EPS scheme if you are a salaried employee. So, if you are employed, you would have to opt for the EPS scheme. Other advantages of EPS are as follows –

  • Besides securing a pension for you, the EPS scheme also ensures that your spouse and children receive a pension in case of your death
  • The promise of lifelong pension gives you financial security in your old age when you have limited sources of income
  • The employer’s contribution are completely tax free for you. Your EPS corpus is, therefore, created without you having to part with your salary or pay taxes on your investments
  • Your pensions are created even when you do not invest yourself. Under any other retirement investment scheme you have to invest your money to create a pension. But, under the EPS scheme, your employer and the Government contribute to create a corpus for pension payments in your old age. So, opting for EPS is, in essence, free for you

Given these benefits, the Employee Pension Scheme is an ideal pension scheme for employed individuals.

The Employee Pension Scheme ensures that if you are a salaried employee you would receive pensions after you retire. The scheme promises lifelong pension and also provides your family with the necessary financial security in case of your death. So, if you are salaried, understand the concept of the Employee Pension Scheme and know when and how much pension is promised by the scheme.

Frequently Asked Questions:

  1. What would be my EPS account number?

    The EPF account number also doubles up as your EPS account number as your EPF and EPS contributions are identified by a single account number.

  2. What should I do when I change jobs?

    When you change jobs, you should transfer your EPS account to another employer so that the employer can continue depositing the contribution into the Employee Pension Scheme. To transfer your EPS account you can log into your EPF account online and apply for EPF transfer due to job change. When the EPF account is transferred, the EPS account would also be transferred automatically. The transfer would be done through a Composite Claim Form which you need to fill and submit.

  3. If the EPS member is survived by a wife and a dependent child, can both claim a pension?

    Yes, in case of death of the EPS member, both the widow and the child can claim a pension. The widow would get the widow pension and the child would get the child pension which would be 25% of the widow pension.

  4. Can I change my nominee under the EPS scheme?

    Yes, you can change the nominee whenever you want.

Types fire insurance India

Sidharth Hampanavar

Fires and other related perils, i.e. events which cause a financial loss, have become a common cause of losses in recent times. These perils cause unspeakable loss to property as well as goods. That is why having a fire insurance policy becomes important. The policy covers the financial loss that you face when assets are damaged due to fire or other covered perils. You can buy a fire insurance plan under the following circumstances –

  • If you are an owner of goods and/or property
  • If you are a pawnbroker or pawnee (pawnbroker – an individual who lends money to another based on any asset pawned by another; pawnee is an individual who lends money to another individual against an asset which is pawned)
  • If you are a mortgagee (mortgagee is a financial institution which lends money based on the mortgage of an asset)
  • If you are the assignee official receiver of assets where insolvency proceedings are involved
  • If you are a warehouse owner and goods are stored in your warehouse for which you are responsible
  • If you are an individual who has lawful possession of any goods or property

Coverage under fire insurance policies

Fire insurance plans not only cover losses suffered by fire but also losses suffered by other perils. The common perils which are covered under fire insurance policies include the following –

  • Fire, explosion or implosion
  • Lightning
  • Damage due to an aircraft
  • Strikes, riots or any other type of malicious acts which cause damage
  • Storm, typhoon, flood and inundation which is collectively called STFI
  • Impact damage which occurs on impact with road or rail vehicles, animals, etc.
  • Subsidence, rockslides or landslides
  • Overflowing or bursting of water tanks, pipes and other apparatus
  • Missile testing operations and the damages caused thereof
  • Water leakage from automatic sprinkler installations which causes damage
  • Bush fire

What is not covered under fire insurance policies?

Despite covering a number of perils besides fire, fire insurance policies also have some common exclusions. These exclusions include the following –

  • Losses by fire which was caused due to earthquakes
  • Perils like war, invasion and the like
  • Perils like martial law, insurrection or rebellion
  • Underground fires and the losses that they cause
  • The loss suffered when the insured property is burned on the directives of a public authority
  • Theft related losses suffered during or after the fire
  • Spontaneous combustion
  • Losses faced because of nuclear perils
  • Losses suffered because of pollution and/or contamination
  • Any type of consequential losses

Types of fire insurance policies available in India

Different types of fire insurance plans are offered in India depending on the coverage need of different individuals. The policies can be for fixed assets like building, plant and property or for goods and stocks of the business. The commonly available types of fire insurance plans include the following –

For fixed assets

  1. Replacement value policy
    As the name suggests, this policy works on the concept of replacing the asset which is damaged due to a covered peril. The insurance company pays the replacement value of the asset which is damaged. The replacement value is calculated as the market value of the asset minus depreciation based on the asset’s age. If the property is insured, the cost of construction of the property is covered under the policy. In the case of other assets, their replacement value is calculated and paid as a claim.
  2. Reinstatement value policy
    A reinstatement value policy is nothing but an added clause under the replacement value policy. As per this clause, the insurance company undertakes to replace the damaged property to its original condition which was prior to the loss. Reinstatement clause is applicable only for fixed assets like buildings. Other assets cannot be covered under this clause. Moreover, you get coverage on a reinstatement basis only if you choose the reinstatement clause in the fire insurance policy. If the clause is not selected, claims would be paid on a replacement value basis only.

For goods, stocks and other non-fixed assets

  1. Floater policy
    This policy is ideal for assets which are located at different locations. A single policy can be taken for all the assets and the assets would be covered on a floater basis. However, to avail coverage, every location and the value of the assets at each location would have to be specified.
  2. Declaration policy
    A declaration policy is suitable for assets whose value changes during the year, like stocks in a business. Under this policy, a provisional sum insured is taken and the premium is paid for the same. The sum insured would represent the maximum risk of the insurance company. Once a month completes, the highest value achieved by the fluctuating asset is recorded and declared. Thereafter, the average of the declared value is calculated and it becomes the actual sum insured of the policy. If the actual sum insured is lower than the provisional sum insured, you can claim a premium refund.
  3. Floater declaration policy
    This policy is the combination of floater policy and declaration policy. Assets stored at different locations whose values fluctuate over the year can be covered under a single policy through this cover.
  4. Specific policy
    This policy covers the loss up to a specific amount. The specific amount is the sum insured of the policy which is usually lower than the actual value of the asset.
  5. Comprehensive policy
    As the name suggests, a comprehensive policy has the widest scope of cover and covers the asset against the maximum number of perils.
  6. Valued policy
    Assets whose market value cannot be assessed can be insured under a valued policy. Under the policy, coverage is allowed for an agreed value of the asset which is the best estimate of the asset’s market value.
  7. Valuable policy
    Under this plan, the sum insured is not decided at the time of buying the policy. The claim amount is calculated at the time of loss. To calculate the claim amount, the market value of the asset is taken into consideration.
  8. Average policy
    The average policy is a fire insurance policy which works on the principle of ‘Average Clause’. An average clause is applicable if you avail a sum insured which is lower than the actual value of the good. In that case, when a claim is made, you don’t get the full amount of claim. You get an average claim which is calculated in proportion to the sum insured that you have taken. For instance, suppose the value of an asset is INR 1 lakh and you avail a sum insured of INR 80,000. Since you have insured only 80% of the asset’s value, you would get 80% claim settlement. So, if the claim is for INR 50,000, the insurance company would apply the average clause and pay a claim of only INR 40,000.
  9. Consequential loss policy
    This policy covers the loss of profit which you can suffer when fire disrupts your business.

Which type of fire insurance policy should you buy?

Given the different types of fire insurance plans which are available in the market, you must feel confused as to which policy you should buy. To clear this confusion, there are some factors which you should consider when choosing the right type of fire insurance plan. The factors which should determine your choice of the policy include the following –

  1. The type of risk that is being covered
    Choose a policy based on the type of risk that you face. If you have to insure assets at multiple locations, choose a floater policy. If the value of your assets cannot be accurately ascertained, a valued policy would make more sense. So, choose a policy based on the type of risk that you face
  2. The nature of the asset which you want to insure
    As stated earlier, different types of assets can be insured under different types of plans. For property and fixed assets, you can choose replacement value or reinstatement value policies while for other assets there are other policies. So, choose a policy suiting the asset which is to be insured.
  3. Exposure risks
    Assess the types of risks to which the asset is exposed and then choose the best policy.
  4. Coverage duration
    It is important to know the period for which you need to take the coverage before you select the most suitable fire insurance policy.

Documents required for claim registration in fire insurance

In case of a claim, you should submit the following documents for registering your claim with the insurance company –

  1. Copy of the policy bond which should also include the schedule of benefits as well as any clauses which have been attached therein
  2. The fire insurance claim form which should be completely filled and signed
  3. Newspaper cutting where the instance of the fire has been reported (If available)
  4. Previous claim records, if any
  5. Photographs of the damages suffered
  6. Police FIR
  7. Report of the fire brigade
  8. The forensic report, if available
  9. Final investigation report

Once the claim is registered, the insurance company would get the claim surveyed and then the claim would be settled.

Fire insurance is very important coverage for protection against the loss of assets. Losses cannot be avoided but you can insure against such losses if you are smart and buy the right type of fire insurance policy.

Frequently Asked Questions

  1. Can I change the type of fire insurance policy after I have bought it?
    Yes, you can change the fire insurance policy after the coverage period of the original policy is over.
  2. Can I increase the scope of coverage under fire insurance plans?
    Yes, fire insurance plans allow various coverage extensions which you can choose to increase the scope of coverage. Some common extensions include the following –

    • Forest fire
    • Damages suffered by the stock when they are stored in cold storage
    • Cover for earthquake-related damages
    • Damages resulting from leakage and contamination
    • Terrorism
    • Cost of debris removal which exceeds 1% of the claim amount
    • Architects, surveyors or engineers fees which exceed 3% of the claim amount
    • Omission to avail coverage for alterations, additions and extension
    • Rent paid for an alternate accommodation
  3. How is the premium calculated?
    Premiums of fire insurance plans depend on the type of policy bought, the risks covered, the sum insured, the value of the asset, usage of the asset which has been insured, expected risks and the policy extensions took.
  4. If the sum insured is higher than the value of the property would the claim be higher?
    No, the claim would be paid on replacement value or reinstatement value clause even if you choose a higher sum insured level.

Laptop Insurance: Complete Guide on Coverage, Claims, Exclusions

Sidharth Hampanavar

In today’s modern time, computers dominate almost everything that you do. Digitisation has become so important in today’s age and businesses and companies run on technology. Computers and laptops have, therefore, become quintessential for completing your work. These gadgets are quite expensive and if they are damaged you incur quite a substantial loss. Though the gadgets are expensive, they are quite easily damaged. Mishandling related damages, theft, short circuits, damage due to liquid spillage, etc. are some of the common causes which damage your laptops. Can you insure these damages?

Actually, you can. There are laptop insurance policies available in the market which cover the damages suffered by your laptop. Let’s understand what the policy is all about.

What is laptop insurance?

Laptop insurance is a general insurance policy which covers the damages suffered by your laptop due to specified perils, i.e. events that cause a financial loss. If your laptop is damaged due to the covered perils, the insurance policy would cover the cost of repairs that you incur.

Why you should buy laptop insurance?

A laptop insurance policy proves beneficial because of the following reasons –

  • The policy covers even those damages which are not covered under the laptop’s warranty
  • You get financial assistance in case of damages suffered by your laptop. This assistance helps you to get the laptop repaired properly
  • If the laptop is stolen you get the sum insured which helps you buy a new laptop without a financial pinch

What is covered under laptop insurance?

Damages to the laptop due to the following contingencies are covered under laptop insurance plans –

  • Cracks or damages to the laptop screen
  • Electrical or mechanical breakdown
  • Theft or burglary of the laptop
  • Loss of the laptop
  • Any type of accidental damage suffered by the laptop
  • Damage due to liquid spillage or seepage
  • Faulty laptop battery or loose port
  • Failure or error in the RAM of the laptop
  • Burn out of the LCD
  • Crash of the hard drive of the laptop

What is not covered under laptop insurance?

There are some instances that are not covered under laptop insurance policies. If you make a claim for these instances, the claim would be rejected. Instances include the following –

  • War, riots, terrorism and related perils and the damages that they cause
  • Damages due to wilful negligence of the policyholder or any other individual using the laptop
  • Any pre-existing defects which were in the laptop before laptop insurance was bought
  • The natural wear and tear of the laptop due to usage and depreciation
  • Damage to the laptop due to climatic conditions
  • Normal maintenance charges incurred on the laptop

How does laptop insurance work?

If you own a laptop you can buy a laptop insurance policy to cover the risks of damage. To buy the policy you would have to approach an insurance company which offers laptop insurance. Understand the coverage benefits and exclusions and then buy the policy by paying the premium charged. The company would assess the proposal for insurance and would accept or reject your proposal. If the policy is accepted you would be given laptop insurance coverage and the company would promise to pay for the damages specifically covered under the plan.

Eligibility parameters for buying laptop insurance

To buy a laptop insurance plan you should be the legal owner of the laptop. The laptop can be purchased in India or imported from an international country through proper import channel. You would have to submit the bill of purchase when buying the insurance policy.

How to make a claim under the laptop insurance policy?

To make a claim in your laptop insurance policy, you should follow the below-mentioned steps

  • The first and the most important step of a claim under your laptop insurance policy is intimating the insurance company. Once your laptop is damaged and the damage is covered under the policy, call up the claim department of the insurance company and inform them about the claim. The insurance company would register your claim and give you a claim reference numbe which you should keep at your disposal during the claim process
  •  If your laptop has been stolen, a police FIR is a must. File an FIR and make copies of it as they would be required with the claim documents
  • Once the company is informed, the company can engage a surveyor to assess the damages suffered
  • Alternatively, the company might direct you to send the damaged laptop to the nearest service centre which is authorised by the insurance company to assess the damages
  • The claim related documents should be submitted to the insurance company quickly for a quick settlement
  • Once the damages have been assessed by the company appointed surveyor or service centre, a claim report would be prepared to estimate the amount of claim
  • Based on the claim report, the laptop would be repaired
  • The claim would then be paid by the insurance company. In case of cashless repairs, the claim is directly settled by the company with the service centre. In case of theft or reimbursement claims the company would credit the claim amount directly to your bank account

Documents required for laptop insurance claims

As mentioned in the claim process, you are required to furnish a complete set of documents for your claims to be processed. These documents include the following –

  • Claim form which should be filled in and signed by the policyholder
  • Photo of the damaged laptop along with the serial number
  • Proof of identification of the individual who bought the laptop
  • Police FIR in case of theft claims
  • If you own an Apple laptop, you would also have to submit a photo of disabled function of ‘Find my Mac’, i.e. when your “find my Mac” command is not working on your MacBook.

Companies offering laptop insurance

In India, only a few insurance companies offer laptop insurance. These are as follows –

Name of the companyName of the policySalient features 
ICICI Lombard General Insurance CompanyElectronic Equipment Insurance Policy
  • The sum insured can be taken on a replacement value basis where the company pays the cost of the new laptop
  • Cost of restoring the damaged or lost data is also covered under the sum insured
  • Add-on covers are also available
Future Generali General Insurance CompanyElectronic Equipment Insurance
  • An all-risk policy is offered by the company which covers almost all types of perils
  • Other electronic equipments are also covered under the policy besides laptops
OneAssistLaptop Insurance Plan
  • The company provides doorstep pickup services for damaged laptop and claim documents
  • Spare parts used are 100% original
  • Doorstep delivery of the repaired laptop
TIMES Global AssuranceLaptop Insurance Plan
  • 100% coverage in case of screen-related damages
  • In case of theft, 90% of the invoice value of the laptop is paid
  • Up to 50%, no claim premium refund is allowed in long term plans
  • A free extended warranty on your laptop is allowed with the plan

Things to remember

Before you buy a laptop insurance policy, here are some aspects of the policy which you should remember

  • The premium of the policy would depend on the coverage features and the cost of your laptop. The more inclusive the coverage benefits the higher would be the premium. Similarly, if the laptop has a higher value, the premiums would be high
  • The exact coverage benefits depend on the insurance company. you should, therefore, read the coverage features before buying the policy
  • Always compare laptop insurance plans offered by different companies before you buy. Comparing would give you a policy which has the best coverage benefits at the lowest premium rates
  • Add-ons are also available with laptop insurance plans which enhance the scope of coverage. Common add-ons include the cost of air transport if you are buying the laptop internationally, coverage for the cost of customs duty, etc.

Laptops are expensive gadgets and damages might involve substantial financial costs. Moreover, warranties are applicable only for a specified period after which you are required to pay for the repair costs of your laptops. A laptop insurance policy comes in handy in covering the damages suffered by the laptop. The policy provides a good scope of coverage along with the option of customising the coverage with add-ons. So, if you own a laptop, buy a laptop insurance policy and secure the costs faced in case of damage or theft.

Frequently Asked Questions

  1. What is the tenure for laptop insurance policies?
    Usually, laptop insurance plans come for a period of one year. However, some companies also offer longer coverage durations.
  2. Are there any discounts on laptop insurance plans?
    Yes, many plans offer you a premium discount if you buy a long term policy or if no claims are made in a policy year.
  3. What is the limit on the number of claims which I can make in a policy year?
    The limit on claims depends on the insurance company offering the laptop insurance plan. Some companies keep a maximum limit to the number of claims while in some companies there is no limit to the number of times you can claim.
  4. What would happen if my laptop is completely damaged?
    In case the laptop is completely damaged where the cost of the repair exceeds 75% of the sum insured of the policy or the invoice value of the laptop, the claim is made on a Beyond Economic Repair (BER) basis. In that case, you get the sum insured after deducting the scrap value of your laptop.
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