Do you own an insurance policy ? No ? Should you have an insurance policy ? Should you hate that person who is called an ”Insurance Man” ? Well, to tell you the truth even I dreaded taking out an Insurance Policy when I was young. That was decades back. Today, I would certainly advise young persons to buy insurance at a young age because the premium is much lesser when you are young and strong.
Life Insurance itself means to ward off some evil to your life . A policy offers protection against risk of death or permanent disability based on the features of the chosen product. But the Policy is written so that it is not easy to understand. If you are deciding to buy Insurance, you must check the premium payable on the policy and its conditions. Also the Insurance Company from which you are buying. Fortunately for the customer the central Government has strict norms in place and an authority called IRDA which ensures that the policy holder is not cheated. In pre independence times there were several private insurance companies and some unexpectedly used to wind up. This does not happen any more.
If you are an earning member of the family, your responsibility is all the more. First You must understand the BENEFITS. In case of untimely death of the insured before the maturity period, full insured amount is paid to the registedred Nominee, provided that your premium has been paid in time. There are Five types of Life Insurance – 1. term Insurance , which is for a fixed tenure say 10 years and 2. Whole Life Insurance which is until death of the insured.
In 1.)The term being fixed, if the insured pays premium regularly until the end of his term, the Insurance Company pays back a certain sum along with Bonus when the insured is still alive after the set term period. In this case the premium is higher and operates as a type of financial investment which takes care of the eventuality of untimely death. In 2.) The Whole Life Insurance, the premium amount is low because the sum for which the person is insured is payable to the nominee whenever the insured dies . In this case the premiums have to be paid regularly during the lifetime of the insured. The Company does not become liable to pay any moneys while the insured is alive. 3) From the first fixed term insurance, a third type of popular offshoot has arisen and this is whole life insurance . It has a guarranteed death benefit and a cash value which earns interest over a fixed period of time. A portion of premium covers death and the remaining towards cash value account. This portion can cover endowmentsand can support dependents like children with disabilities. Whole life Policy is expensive and is suited to high income group individuals who use it as a diversified investment.
4.)The fourth type is a flexible policy which partially covers your death risk and partially operates as investment getting interest on investment. This is Universal Life Insurance and has investment risk
5.) The fifth is a Variable Life Insurance Policy which allows the Company to invest a portion of the cash value in equity and Mutual Funds. The Net Asset Value varies according to the Market fluctuations. The last three are offshoots of the second type. However the Income Tax Laws relating to the last three types must be carefully seen if the insured wants the exemmptions to operate.
SOME INTERESTING FACTS :
The first company in India to offer life insurance coverage, was established in Kolkata in 1818 by Bipin Das Gupta – The Oriental Life Insurance Company
Surendranath Tagore had founded Hindustan Insurance Society around the same time which later became the Life Insurance Corporation.
The Bombay Mutual Life Assurance Society was formed in 1870, almost half a century later. It was the first native insurance provider of Western India. Other insurance companies established in the pre-independence era include:
- Postal Life Insurance (PLI) was introduced on 1 February 1884
- Bharat Insurance Company (1896)
- Swadeshi Life (later Bombay Life)
- Sahyadri Insurance (Merged into LIC)
- These several private companies operated when the Indian Market was volatile and therefore many companies folded up . Public had little trust and it was left to MP late Mr Pheroz Gandhi to raise this matter in Lok Sabha. This led to Nationalisation of Insurance business in 1956 and Life Insurance Corporation was born, the largest insurance company in India. Privatisation of Life Insurance and setting up of IRDA as the supervisory body has brought great stability and reliability to Life Insurance Business in India
- There are four major General Insurance Companies in the Public Sector . Vehicle Insurance is compulsory and driving a vehicle without Insurance is an offence. Business establishments cover their offices and factories against theft, burglary and fire. Now Agricultural Insurance has also become popular with farmers insuring their crop against vagaries of nature and fire which spreads from nearby areas due to burning of stems by farmers.
Hit by private bus, ST bus runs over 5 waiting at stop in Gujarat
Workers compensation provides wages and medical care costs for people who are hurt on the job. Employers pay for workers comp coverage. Employees don’t contribute to the fund. A workers compensation is paid if the employer or insurance company confirms that the injury or illness was work-related.
Accidents are always unexpected and many times due to some machine defect. Workers are protected by Insurance Cover which employers pay. Pictures above are common examples depicting why workers should always ensure that their Company has adequately covered their risk of life or bodily injury.