Video Tutorial

Suresh Sadagopan

Who should take life insurance?

Harsh Roongta

What is a term insurance plan?

Anil Rego

Right amount of life cover: Dilemma decoded

Our Experts

Understanding Life insurance

  • 1. What is a term insurance plan?

    Term insurance plan is a form of life cover, it provides coverage for defined period of time, and if the insured expires during the term of the policy then death benefit is payable to nominee. Term plans are specifically designed to secure your family needs in case of death or uncertainty. It provides specific amount of coverage for specific period of time.

  • 2. Why is the preimums charged for taking a Term Insurance Policy very low?

    The premiums for Term insurance policies are the lowest among all the types of life insurance policies. The premiums are low since there is no investment component and the entire premium goes for covering the risk. So if the policy holder expires during the insured term, the death benefit is paid to the nominee. There is no survival or maturity benefit once the policy term expires. There may be some plans that offer to return the premiums paid by the policy holder if he survives.

  • 3. How to choose a best term plan?

    To choose best term plan you should consider important factors like:
    a) How good is the insurance company
    b) How much cover do you need
    c) Check the claim settlement ratio
    d) The factors of inflation in paying the premium and coverage benefits
    e) Compare the terms and conditions of various insurance companies
    f) You can take two term insurance plans from two different insurance company, it will save you in case of rejection of claim from one of either two companies
    g) Do not just look for the low term insurance plan as they might be an important factor but may have several conditions attached for the time of claim
    h) You can also go for an online or offline term plan

  • 4. Is there much difference in premium across term plans?

    The premium in the term plan could vary from one company to another and as the tenure of your policy increases, the premium for the same sum assured increases.

  • 5. Are there any eligibility criteria for term insurance plan?

    The eligibility criterion for term insurance plan varies according to the insurers, the minimum age of entry is 18 years and the maximum age limit is 65 years.

  • 6. Do term insurance plan have an option to convert it to other traditional plans?

    The convertible option is provided to you in term insurance plan, and you can convert it to the whole life insurance policy or the endowment plan any time during policy tenure without additional charges.

  • 7. If I missed a premium, is there a chance that my policy may lapse?

    If you miss the premium then the first thing is to know the status of your policy through your agent or insurance company. According to Life Insurance Corporation of India (LIC) a grace period of 30 days is allowed where the mode of payment of premium is yearly or half yearly and 15 days in case of monthly payment.

  • 8. Can I surrender an insurance plan?

    Yes, you can surrender an insurance plan that is to exit from a plan before maturity. From this the surrender charges would be deducted which varies from policy to policy. No charges are levied if the surrender is done after five years.

  • 9. What are the risks involved in surrendering an insurance plan?

    You should only terminate the policy if you feel that it does not fulfil your requirements and if you are in need of cash with no other options left. If you surrender the policy early i.e. three years from its inception then surrender value would be at least 30% of premiums paid, and some insurance companies also eliminate the premium paid in first year.

  • 10. What are the smokers and non-smokers criteria in the term plan?

    It includes the smokers or users of any tobacco products, such as chewing tobacco etc. Some smokers who have quit smoking are also eligible for favourable premiums. However the period varies among insurers.

  • 11. What is difference between a participating and non-participating policy?

    A participating or profit policy would enable the policyholder to share in the profits of an insurance company which depends on the investment returns of the insurance company. In non-participating policy there is no profit sharing with the insurance company.

  • 12. Will I get a tax benefit on the insurance premium?

    Premiums paid for all life insurance policies are exempted from tax up to a maximum of Rs 1 lakh under Section 80C of the Income Tax Act, 1961. The claim amount received by the beneficiaries or bonus in the hands of the policyholder is tax free under Section 10 (10D) of the Income Tax Act.

  • 1. What is the whole life insurance policy?

    Whole life insurance is also referred to as permanent life insurance. It provides you with coverage for your entire life; as long as you make premium payments on time. This option is good for long-range goals and there are guaranteed cash values which you can use later for temporary needs or in emergency cases. It is best to get this policy when you are young since your annual premiums will be lower.

  • 2. Whole life insurance plans are suitable for?

    The whole life insurance policy is suitable for people of all ages. What are different kinds of policies under whole life insurance policy?
    Whole life insurance policies are classified into:
    Pure whole life - the coverage is for entire duration of life, premiums are payable continuously throughout the life of the insured till death.
    Limited payment whole life insurance - the risk coverage is throughout the life, but the premiums are paid for limited and shorter period.

  • 3. Am I paying a right amount of premium?

    How to find out if my premiums are high and the cover is low? A whole life insurance provides fixed amount of benefits and the premiums are also fixed. So there is no risk of premium being high and the cover low, but it depends on which type of whole life insurance plan you are willing to purchase.

  • 4. How to claim whole life insurance policy money?

    Generally how long will the claim take? The life insurance pays benefit on maturity or on the death of insured person, but payments are not done if the life insurance company is not informed when policyholder dies. You need to keep policy papers ready at hand and know the details of filing a claim with insurance company. Once the claim is submitted you receive the settlement and the most important is original death certificate without which you cannot claim.

  • 1. What is an endowment insurance plan?

    An endowment policy covers risk for the specified period at the end of which a person insured receives the sum assured plus all the accrued bonuses. Endowment are considerably more expensive (in term of annual premiums) than either whole life or term plan. In case of death during the tenure, sum assured with bonus is paid to the nominee. Endowment plans have two types of bonuses: - Reversionary bonus: Also called regular bonus, this is annual bonus which depends on the performance of the insurer and is added to the fund every year payable at the end of policy period. - Terminal bonus: An additional loyalty bonus offered by the insurer at the end of policy term

  • 2. Are there any bonus payouts in the endowment policy?

    Endowment plans have two types of bonuses:

    1. Reversionary bonus: Also called regular bonus, this is annual bonus which depends on the performance of the insurer and is added to the fund every year payable at the end of policy period.

    2. Terminal bonus: An additional loyalty bonus offered by the insurer at the end of policy term

  • 3. What types of riders are included in insurance policy?

    Riders are the additional benefits added to policy but you have to pay an extra premium for it. Various riders under insurance company are: critical illness rider, accidental death and dismemberment rider, partial or permanent disability, waiver of premium rider.

  • 4. What are the kinds of plans under the endowment insurance plans?

    Endowment plans provides various plans according to the need such as double endowment policy, education endowment policy, marriage endowment policy, unit linked endowment, full endowment and low cost endowment.

  • 5. Who should go for an endowment policy?

    If you are looking for a cover which gives you additional benefits along with life cover then endowment plan would be best suited for you.

  • 6. Term insurance Vs endowment?

    The basic feature of term insurance policy is that it provides death risk cover, whereas endowment policy covers life along with other risk such as accident, permanent disability.

    The claim to the nominee is assured only if there is sudden death, but if the insured survives till maturity then no claim is paid. In endowment plan the claim is paid in both the conditions.

    Endowment plan charges more premiums then the term insurance, since the money is invested in various instruments.

    Insurance should never be associated with investment and in term insurance you have no investment, while endowment will deduct your money in investment, mortality, insurance and return you some part of income on maturity.

  • 1. What is money back insurance plan?

    Money back life insurance plan provides for periodic payments during its tenure, it gives back money to policyholder at different points in time usually 4-5 years. The investments done are similar to endowment plans. Money back policy will give you 20% of the sum assured after first 4 years, and next 20% after 8 years and the remaining 20% on maturity with accumulated bonus.

  • 2. How does money back insurance plan works?

    In a money back plan you keep getting the percentage of sum assured during the term of the policy. It is beneficial to meet the financial obligations at a point of time when you need money, rather then waiting for the full policy term to receive the returns. However the returns are not market linked since they invest in asset classes which will yield low but fixed returns.

  • 3. What are the benefits of the money back policy?

    The money back insurance policy provides you with the benefit of periodic payment for the term of policy. The bonus is calculated on the full sum assured, some insurance companies also provide additional optional benefits. In event of death at any point in the policy term the claim includes the full sum assured without deducting any survival benefit amount. You should also go through the terms and conditions before buying money back policy or even while buying any kind of insurance policy.

  • 4. How much bonus can be received and when in money back policy?

    Money back is with a profit plan; bonus is calculated on the full term assured. Final additional bonus is also payable but if policy has been taken or run for certain minimum period.

  • 1. How pension plan works?

    Pension plans are also known as retirement plans for your future financial stability during your old age. With ever increasing cost of living it has become important that you make arrangements for your retired life. When you continually invest in this plan it grows with the compounding effect.

  • 2. Who can opt for a pension plan?

    This policy is suited for people who want to secure future and for senior citizens, and it would be best time to invest in it when you are earning.

  • 3. What is a personal pension plan?

    This is a pension policy which is invested in funds that are chose by you according to the amount of risk which you can take and future plans. There is no involvement of employer. Pension schemes offered by the life insurance companies are of two different types. One is deferred annuity plan and other is immediate annuity plan. Deferred annuity or pension schemes are meant to create retirement corpus by depositing some regular income every year. Immediate annuity gives you monthly payment as pension for which you have to deposit lump sum with the life insurance companies.

  • 4. What is a work based pension plans?

    Work based pension plan is set up by the employer to save for retirement of employee, and the employees contribution is directly collected from his salary or wages.

  • 5. How is the pension plan different from money back insurance policy?

    Pension plan are meant for the later stage of life i.e. old age and retirement, while money back plans can be used for expenses like child education, marriage, purchase of property. The sum assured in pension plan is received only during the later stage, whereas the sum assured in money back is received at regular intervals. The tax benefits are avail in both pension plan as well as money back plan

  • 1. What is a child plan?

    As a parent, you wish to provide your child with the very best that life offers, the best possible education, marriage and life style. Children's plan helps you save so that you can fulfill your child's dreams and aspirations. These plans go a long way in securing your child's future by financing the key milestones in their lives even if you are no longer around to oversee them.

  • 2. Are children's plans different from regular life insurance plan?

    Child plan includes certain benefits such as life cover, education plans which will safeguard future of your child and help you with rising cost of education. If we compare a term plan and child plan, in case of term insurance if policy holder dies then death benefit paid policy ends, while in child plan it continues and rest of premium paid by insurer. In a case if policy holder survives then there is no maturity benefit in term insurance, whereas there is a maturity benefit in child plan.

  • 3. When is the right time to buy a child plan?

    You can invest in child insurance plan right from the time child is born and withdraw once the child reaches adulthood.

  • 4. What are the types of child plans available in market?

    There are two types of child plan in market provided by insurance company: Child ULIP: A fraction of premium flows into debt instrument and rest in the equity market and the switching depends on the insured; the returns depend on the NAV . Child endowment plan: the premium paid flows only in the debt instrument and return depends on the bonus payable at maturity.

  • 5. Does this plan help in securing child's education?

    Yes the child education plan helps in securing child's education.

  • 6. Are there any insurance riders available to child plan?

    The riders available in child plans are premium waiver rider, accidental death and disability benefit, critical illness rider benefit.

  • 1. What is unit linked insurance plan?

    ULIPS provide for benefits of protection and flexibility in investment, it is insurance cum investment plan. The allocated premiums will be applied to purchase units as per the fund type based on the ongoing NAV . NAV is the value per unit of the scheme. They provide multiple benefits like life protection, investment and savings flexibility, options to take additional covers, tax planning, etc. but they are riskier compared to other schemes.

  • 2. Who can buy a unit linked insurance plan?

    You can buy a ULIPS as an investment purpose, policyholder have a right to choose between an investments options of debt and equity. It should balance with both your investment and insurance needs.

  • 3. What is difference between investing in ULIPS and Mutual fund?

    Both ULIPS and mutual fund carry market risk and depend on market returns
    Mutual fund are regulated by SEBI and ULIPS are regulated by IRDA
    ULIPS are combination of both investment and insurance, mutual fund is pure investment
    ULIP allow you to increase your life cover while keeping your premium same
    Mutual fund are best suited for those who focus on investment and medium term returns, on the other hand ULIPS are for those who want to invest as well as get benefit of insurance in long term.

  • 4. What are the types of ULIP plans available in market?

    Types of ULIPS depend on the purpose of it such as ULIP for retirement, ULIP for wealth creation, children education and health benefit.

  • 5. How to choose a best ULIP plan to get maximum benefit?

    You should know the percentage of risk that you can take, understand the charges of different plans, compare the past performance of your plan, decide the amount of premium to be paid and risk cover you need, know about how much premium is being insured and how much is invested, find out if any tax benefit is being offered, check if there are any switching options available and charges on it.

  • 1. All you want to know about group life insurance

    Group life insurance -- This scheme provides insurance coverage to a group of people under one contract. These schemes are provided for employees, associations, societies, etc.

  • 1. What are the benefits of group life insurance?

    This scheme provides insurance coverage to a group of people under one contract. These schemes are provided for employees, associations, societies, etc. Group insurance are more affordable than other individual insurance plans and also beneficial to those who cannot afford individual life insurance.

  • 2. Can an individual purchase it and include family members in it?

    Some eligible groups for group insurance are: employer-employee group, creditor-debtor group, professional group.

Tease Your Mind

Take the test and check your knowledge of Insurance.

Start Now

Demand for payment in accordance with insurance policy in case of maturity or death of policy holder is called as

  • Purpose and circumstances of borrowing
  • Regulatory limits on borrowing
  • Potential risk to AMC and unit-holders
  • Names of lenders

Tools & Calculators

BMI Calculator

Body mass index is a formula that uses height & weight to determine if you are considered of healthy weight. A high BMI is associated with increased risk of death.


Heart Rate calculator

A normal resting heart rate for adults ranges from 60 to 100 beats a minute. Find out what is your Maximum Heart Rate and Target Heart Rate.



Q. When should I insure?

When your family members become dependent on your earning income, you should insure yourself. The advantage of starting insurance at an early age is that the premium will be lower at early stages. Even if you are single, earning and planning to get married, you should think of buying a policy now, as it costs less now than it will when you marry. Even if you are 45, and not insured, you could still choose insurance plans that provide benefits to your family and provide income during your retirement period.

Q. How do I reduce the cost of buying life insurance?

The cost of a policy could be lowered if one starts buying insurance at an early age (while the risk is lower). A longer duration policy along with large sum assured would also reduce the cost. Also you will avail discounts if you offer to pay premium annually. Select a low cost policy such as a Term product. Do not buy riders or additional benefits that may not be of additional benefit to you.

Q. How much sum assured I should take?

There are two methods of deciding the sum assured which is human life value and need based analysis. One should use need based analysis method for deciding sum assured. In need based analysis method we should add survivors living expenses, future value of outstanding life goals, outstanding debt, cost of dying (funeral, estate lawyer's fees, etc.) and subtracts saleable investments, and insurance already available. The difference is the sum assured required.

Q. What does my family get on my death?

If death of the policy holder takes place during the term of the insurance policy, then the nominee designated by the policy holder receives the assured sum plus the accrued bonus, if any. If the policy is along with the bonus policy or participative profits, the bonus is payable to the nominee in addition to the sum assured but only for the number of years the premium has been paid. If the policy has an accident rider and death takes place due to an accident, then nominee may receive double the sum assured. However, if death takes place after the policy has matured, then the nominee does not receive anything from the insurance company. There are certain policies which offer to cover the insurer for the sum assured or a part of the sum assured, even after the policy has matured.

Q. Why should I buy life insurance?

Life Insurance provides you and your family with protection against all the risks involved, moreover providing you an opportunity to grow your investments. It could be viewed as a long-term investment to provide for your child's future expenses or your expenses, post retirement. Source: SBI Life Insurance

Q. What is Redirection?

You can redirect your current contribution allocation percentage into various funds. It will not impact the percentage of the contribution already invested.

Q. How much should I insure for?

The amount you insure for is called the sum assured. Normally a policy should cover the value of the asset - either the market value while insuring, or the cost of replacing the asset should it be lost or destroyed. The premium will depend on the sum assured.

Q. What are the various types of insurances?

The insurance sector is classified into Life and Non-life or General insurance Under Life insurance, an individual's life is covered. In simple terms, the insured's nominee will receive a certain amount of money from the insurance company if the insured individual dies within a specified time. Under General Insurance, everything is covered. Thus, an individual could insure himself for his health, property, vehicle, travel, office, shop, education and even pets.

Q. What is a Whole Life insurance product?

Whole life insurance risk covers the death of the insured, whenever it may happen. It means that there is no fixed term under whole life insurance. Most policies provide a dividend to the policy holder which helps with retirement. There are two variations in the whole life insurance products i.e. Pure Whole Life Insurance: - where premiums are payable continuously throughout the life of the insured till death. Risk coverage is for the entire duration of life and the life insured amount is paid on the happening of the death of the insured at any time. Limited Payment Whole life Insurance: - where premiums are paid for a limited and shorter period and the option of the insured or till death if earlier. Risk coverage is however throughout the life of the insured. Source: SBI Life Insurance

Q. How do I collect the maturity amount from the insurance company?

Insurance companies send information in advance to the policyholder regarding the maturity of the policy. The policyholder will be required to fill-up the forms along with the documents attached as per requirement. If the paper work is done properly and verified then the payment is either sent by post or directly credited in your bank account.

Q. Why should one insure ?

One of the main reasons one should insure is to protect one's belongings and assets against financial loss. When one has earned and accumulated property, protecting it is prudent. The law also requires us to be insured against some liabilities. That is, in case we should cause a loss to another person, that person is entitled to compensation. To ensure that we can afford to pay that compensation, the law requires us to buy liability insurance so that the responsibility of paying the compensation is transferred to an insurance company.

Q. What do I get if I insure?

The insured person will get satisfaction that his family is completely insured in case something happens to the major earning member of the family. His family will get assured sum after his death. In monetary terms, you can claim tax-deductions under section 88. Premium paid towards a life insurance policy, up to Rs 1,00,000, can be claimed as a tax-deduction u/s 88. Survival benefits or Interim benefits, i.e. money received during the term of a money back policy are tax-free. Maturity benefits or the amount received at the end of the term of a policy is also tax-free. Proceeds of a life insurance policy, received by the nominee, are tax-free. For a Health insurance policy, you can claim the premium amount, up to a maximum limit of Rs 10,000 u/s 80D. Moreover, the money you receive from the insurance company, during the term of the policy and/or upon maturity, is tax-free.

Q. What is Grace Period?

It is a provision given to the policy holders to pay premium in the next 15-30 days since he fails to pay it before due date. This period of 15-30 days is called as grace period.

Q. What is vesting age?

The age at which you start receiving pension in an insurance-cum-pension plan is known as vesting age.

Q. How do I understand a life insurance Policy?

It is necessary to know the following terms in order to understand a life insurance policy: Premium - the amount of money you have to pay to continue your insurance coverage. The premium amount depends upon • Your age • Policy selected • Mode of premium payment • Term of premium payment • Term of the policy You could choose to pay premium monthly (as a deduction from your salary), quarterly, half yearly or annually. However, there are Single premium policies where you pay premium once only (hence you do not have the facility to make the effort of paying premium regularly). Term - the number of years you choose to insure yourself. The longer the term the lower the premium. Policy terms vary from a single year to a maximum of 55 years. Not all policies offer you a range of terms. Premium paying term - the number of years you pay premium on your policy. The longer the premium paying term, the lower the premium. Usually the premium paying term is the same as the policy term. However, some policies offer you the option of selecting a premium paying term that is lower than the policy term. Sum Assured / Face amount - the amount of insurance cover you have or the minimum amount your family receives in the event of your demise. Your family could get more than this amount based on the type of policy or riders that you select. Bonus / Participating profit - is declared by the insurance company each year as a proportion of the sum assured. This amount could vary; it could be different for different policies and terms. Although declared each year, the bonus is a lump sum payment made to the insured person upon maturity or to his family upon death, in addition to the sum assured. Bonus is based on an insurance company's assumptions about the future performance. Like any other assumption, actual results will be more or less favourable. The longer the time being projected, the greater the likelihood of variance from the predicted values. Not all companies guarantee the amount of bonus on each policy. Guaranteed Addition - is a declaration made by the insurance company; it states that irrespective of the financial results of the company, the company will pay the guaranteed amount of money, to the insured or his nominee. Like the bonus amount, this is a lump sum payment made to the insured upon maturity or to his family upon death, in addition to the sum assured. Survival Benefit - is the amount of money received at pre-fixed, regular intervals by the insured person, upon survival of the term of the policy. Often, money received upon maturity or at the end of the term of the policy is also referred to as Survival benefit. Maturity Benefit - is the amount of money received by the insured, upon survival of the term of the policy. In case of policies that offer a bonus, the sum assured plus the bonus for the term of the policy is paid to the insured upon maturity. In addition, some policies offer a loyalty addition, which is paid as a proportion of the sum assured and is based on the term of the policy. In case of policies that offer no bonus, upon maturity, the sum assured or a refund of the premium or no money is receivable by the insured (depending on the type of policy selected). Cover or Death Benefit - is the amount of money the nominee receives from the insurance company upon the insured's death. In addition to the sum assured, this would include the bonus, if any. If additional riders such as Accident Death Benefit or Additional Sum Assured have been selected, the amount of money receivable by the nominee could be higher. Returns or Pre-tax yields - Interest earned on the premium, on a compounded basis, is the pre-tax yield. Post-tax yields - If the premium paid for a life insurance policy is used as a tax deduction under section 80C, then the effective premium paid by the insured is lower. Interest earned on the effective premium, on a compounded basis, is known as the post-tax yield. Source: SBI Life Insurance

Q. Whom should I insure?

Income producer- If you are the major earning member of your family, you need to insure yourself first. Working spouse - If your spouse is also earning then both of you could take an insurance cover in a joint-life policy. It is a good option for working couple since it could serve as a low-cost policy covering both of them. Children - If you have children you could buy an insurance policy in their names. This would also help your children to receive a certain amount of money when they opt for higher education. Partner/Key-person in the organization: If you have a working partner in your firm or a key-person(s) in the organization, your firm/organization could buy life insurance for them.

Q. What type of insurances should I have?

To ensure you are safe, you should ensure that you have Health insurance, - Life insurance, Accident Insurance, Automobile insurance, - Home insurance

Q. Why do different people have different premiums ?

The premium is calculated on the extent and nature of the cover you want. A higher sum insured means a higher rate of premium. Similarly a higher risk will be charged a higher premium. An example of this is that an older person will have to pay a higher premium for health insurance for the same sum insured. Sometimes the risk is higher depending on the location of risks - for example in motor insurance in areas where accidents are higher. So the premium will vary according to the nature and severity of the risk. If I buy a policy and don't make a claim, it is a loss. So, why should I buy insurance? General insurance is not meant to be for savings or investment returns. It is meant for protection. What you pay for is the protection against a risk. To approach it as something from which returns should be obtained is not the correct approach as there is a price to pay for protecting a property worth lakhs for a few hundred rupees.

Q. On what basis is claim paid?

In indemnity policies, the upper limit of a claim is the sum assured and this usually applies for the period of the policy. Certain policies, however, allow for reinstatement of the Sum Insured by payment of proportionate premium for the remaining period of the policy. The actual claim will be the actual extent of financial loss as validated by documents like bills. If the property is underinsured, the insured shall bear a rateable proportion of the loss. There can be more than one claim in the policy period but the sum assured is usually the limit for the policy period unless reinstated. Nowadays health insurance policies - which cover hospitalisation costs - have also a cashless settlement of claims. That is, you don't have to pay for the treatment at the hospital and then make a claim for reimbursement of the expenses. The insurance company has a service provider called the third party administrator (TPA) health services, who liaises with the hospitals and directly makes the payment for your treatment as per the terms of your policy and coverage.

Q. What is Deferment Period?

Period between the subscription date of an insurance-cum-pension policy and the time at which the first installment of pension is received is called as deferment period.

Q. What are the Tax benefits applicable to me if I invest in a Life Insurance Policy?

If you invest in life insurance policy, you will get deduction under Section 80 C of the income tax act, 1956 of the premuim paid within overall limit of Rs. 1.50 lacs per year along with other eligible items like Provident fund, EPF, NSC, ELSS, tuition fee, repayment of home loan etc. However in case the amount paid towards life insurance premium exceeds 10% of the amount of the sum assured, you will get the deduction only upto 10% of the sum assured. Moreover When the maturity proceeds are received the same will be fully exempt if the premium paid on such policy did not exceed 10% of the sum assured in any of the year.

Q. What are the basic elements of Life Insurance?

The two basic elements of life insurance are Risk coverage (i.e. Term Insurance) and savings for the future (i.e. Pure Endowment)

Q. What is the periodicity of premium payments?

Most general insurance policies are annual and the premium payment is in advance. No risk commences unless you have paid the premium. In some long term policies companies have the facility of collecting premiums periodically.

Q. Should I buy a life insurance policy even if my employer has insured me in a group insurance scheme?

It is always sensible to buy an individual life insurance policy because a. The amount of insurance covered by your company may not be a very large cover b. If your employer decides to cut cost then you may no longer be covered c. If you quit the company then you may no longer be insured d. Age also plays a role. The premium goes high as you start getting older.

Q. If there are problems with claims what can I do?

First you should write to the company and give them sufficient time to respond suitably. If they don't respond, or it is not a response satisfactory to you, then you can approach the appropriate judicial channel. For complaints relating to personal insurance covers upto a value of Rs.20 lakh, you may approach the Insurance Ombudsman in your area. The Ombudsman has a technical team that will go into the merits of your case and give an award) If you are unhappy with the outcome with the Ombudsman you still have recourse to consumer courts. The IRDA also has a Grievance Cell.


Accident & Accidental Death Benefit

In the context of life insurance, accident or accidental death is defined as a sudden and unforeseen happening that causes disability or death of the policyholder.

Accidental Death Insurance

Accidental Death Insurance provides coverage in the event of death due to accidental injuries, but not illness. In the event of death, payment is made to the insured's beneficiary. And most of these covers provide for cases for bodily injury (e.g., the loss of a limb), where the insured receives a specificed sum.

Accumulation Period

The time interval between the commencement of the policy and the time when benefits are paid out. It is established by the insured.

Actuarial Cost Method

A method that determines contributions that would be made under an insurance plan.


An actuary is a professional with expertise in technical aspects of pensions, insurance and related fields. An actuary is a statistician and a specialist in the mathematics of risk, especially as it relates to insurance calculations such as expectancy, premiums, dividends, and annuity rates. The actuary estimates how much money must be contributed to an insurance or pension fund in order to provide for the future.


Accidental Death and Dismemberment Benefits

Adjustable Life Insurance

A facility allowing a life insurance policy owner to change the insurance plan, increase or decrease the premium and make changes in the protection period.

After Tax Rupees

This refers to the disposable income that the policy holder has in his hands after paying all tax dues during a particular financial year under the Income Tax Act.

Age Limits

The maximum and minimum ages above or below which an insurance company will not accept applications for insurance from or will not renew a policy with a person.

Agent (Life Advisor)

A representative of an insurance company authorized to sell insurance policies.


Annuitant is the person who receives the annuity amount periodically at yearly/half yearly/quarterly/monthly or stipulated intervals.


An insurance scheme that pays a certain value at monthly, quarterly, half yearly or yearly intervals, based on the annuitant's specification. Annuity is a policy under which an insurance company promises to make a series of periodic payments to a named individual in exchange for a premium or a series of premiums called the purchase price.

Annuity Certain

An insurance contract that provides an annuity for a certain number of years, irrespective of whether the insured is alive or dead.

Annuity Consideration

The payment that an annuitant makes for an annuity.


Assignee is the person to whom the title, rights and benefits under a life policy are assigned.


A transfer of the rights and benefits of an insurance policy from one person to another. A life insurance policy is regarded under the law as a form of personal property. Its owner can retain the policy, transfer it to someone else, mortgage or charge it or use it as the basis of a trust.


Assignor is the policyholder who transfers the title, beneficial interest and rights under the policy to another individual.

Attained Age

It is your current age.Your attained age is one of the factors life insurance companies use to determine your premiums. As the older you are, the probability of death during the period of insurance cover i.e life insurance risk increases and so does the premium. Higher the risk, higher the premium.


The Insurance Regulatory and Development authority, IRDA established under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999 is the regulator for the insurance sector.

Markets & Macros

Mon - Fri 11:00 am

Get your Personal Finance queries answered on the show

Additional info on your age, occupation and background would help the experts address your queries in a better manner