What is Inflation? 

Inflation is the increase in the value of the goods and services over a period of time. Inflation decreases the purchasing power of currency. That implies that the goods or services have to be bought by shelling out more money. The goods prices have increased but the currency power has not changed which would result in paying more for the same goods. Inflation is a gradual process taking place over the years.

Causes of Inflation:

There are many intricate and complicated dynamics of economics that cause inflation. Some of the causes include misbalanced supply and demand, increase in production and distribution costs, increase in tax on goods and services, unstable political or economical environment etc.

Effects of Inflation:

Inflation has the worst effect on the consumers. Since the price of commodities have increased, it becomes hard for the consumers to afford the basic commodities. The consumer’s have no choice but to ask for rise in wages which might not be possible. That is why government tries to decrease or control inflation. Whenever inflation increases, it is observed that many changes are introduced in the monetary and fiscal policies. Such changes do not bode well for the overall economic development of the economy.

How to Tackle Inflation?

Inflation results in increased value of goods and services. The customer has to take proactive steps so that inflation does not overwhelm him. By investing in such a way that the rate of return on investment is more than inflation rate, one can make sure that he is not affected by the ever changing inflation.

Be truthful to have hassle free successful claim

Insurance claim is clearly the most popular and contentious subject. The insured is always concerned whether the insurer will pay the claim or not. On the other hand, insurer is exceptionally careful of fraud claims that might put the insurer in loss. One should be truthful while making a claim to avoid any problems.

Life insurance: Life insurance involves high payout with low premium. While buying life insurance, people intentionally or unintentionally hide lot of information like drinking, smoking addiction which might increase the premium. This only leads to rejection of claim if it is found at later stage that the policyholder withheld information.

Motor Insurance: Many people lie about accidental claims. Example- if the person driving the car is drunk or does not hold valid driving licence, insurance company will reject the claim out rightly.

Home Insurance: If theft takes place, it’s better to be honest about the things stolen. It’s best to tell the insurer exactly the things stolen so that the claim can be given without problems. There are exclusions like things stolen by servant cannot be claimed. The insurer does not take count of your possessions at policy inception; it is accepted at face value. Often, people lie about items stolen.

Being truthful about the claims ascertains that your claim never gets rejected and your loved ones can live comfortably.

How to make Successful Insurance Claims?

It has been concern of many people that insurer’s do not pay claim. Yet it is true that genuine claims are never rejected. There are few ways to ensure that your claim does not get rejected:

- Insurance Coverage

Before making the claim, make sure of inclusions and exclusions. You can only claim what you are entitled for and nothing else. Any additional claim payout requested may lead to rejection of claim and process would have to be repeated with the right claim.

- Follow the Rules

There are few guidelines about intimating the insurer about the situation as soon as possible. Deadlines are to be strictly adhered to; otherwise the claim might get rejected.

- Honesty always pays

Insurers are always wary of fraud cases. Any hint of deception could lead to thorough investigation on the part of insurer. So you should be truthful about the incidents that have happened so that no excuse is given to insurer for the delay.

- Regular Interaction

Be in regular touch with your insurer about the status of your claim. That conveys your genuine concern about the claim and the process gets faster.

- Be helpful

By being straightforward and providing them as much information as you can, the insurer can assess the claim without many doubts which would only help your case.

- Last Resort

If you feel you have done all the possible things and furnished the insurer with all the required details and still the insurer is stalling things, you can get in touch with the ombudsman with your case details to resolve the things for once and for all.

Home Insurance Overview

What is Home Insurance?

Home insurance is property insurance that covers both house and its contents. Home insurance protects one of your biggest investments against both manmade and natural disasters. If there is any loss due to either of the mentioned factors, the insurer will bear the financial costs.

What is covered in Home Insurance?

Home insurance financially protects against both manmade and natural disasters.

(a) Natural disasters typically include fire, lightning, flood, explosion, aircraft damage, storm, cyclone, hurricane, earthquake, volcanic eruptions and similar disasters.

(b) Manmade damage includes burglary and housebreaking

How is Sum Assured decided for Home Insurance?

Home insurance protects you financially against damage to property. The Sum Assured for home insurance has two parts- structure and contents.

The Sum Assured for structure is based on the re-construction of the house. The amount that it would take to rebuild the house is the Sum Assured. The amount is determined by the area of the house and construction rate prevalent during the time of construction.

Example:

Area (built) = 1000 square feet

Present construction rate in city = Rs 1500

Sum Assured= Area x Rate= 1500 x 1000= Rs 1,500,000

The Sum Assured for the contents is the market value of the item minus depreciation. The contents could be jewellery, household appliances, furniture etc.

What is not covered in Home Insurance?

There are few situations when the insurer will not pay out for the damages which are:

- Willful destruction of property

- Loss or damage as a result of depreciation

- Loss or damage caused by nuclear materials

- Loss or damage due to riots, war , invasion etc

- Loss or damage caused by insurer’s domestic help

- The house being used for business purposes like tuitions etc

- If the house is kept unoccupied for more than stipulated time

- Contents like money, stamps, bullion, deeds are not covered

How much for Home Insurance?

The premium for home insurance depends on the Sum Assured which is the combination of reconstruction rate and contents value.  Additional cover like terrorist cover, additional rent can be opted for by paying nominal additional premium.

Illustration: Mr. Singla owns 1000 square feet house in New Delhi. He gets insurance of Rs 1,800,000 for the house structure. He owns valuable of approximately Rs 400,000 whose Sum Assured is Rs 75,000. The premium he has to pay is Rs 2217 annually.

By opting for paying 3 years or 5 years premium at the beginning, one can get additional discounts. Some insurer’s also offer discounts if you install security features for your home.

Tax Planning and Insurance

As the financial year end approaches, there is rush to buy insurance policies to avail tax benefits.
In life insurance policies, tax deduction is possible to maximum of Rs 1 lacs. In health insurance policies, the maximum deduction is Rs 15,000 and Rs 20,000 for senior citizens. However the maximum tax deduction combined could be Rs 35,000 if individual buys health insurance for himself and his parents who are senior citizens.

Everyone just jump the bandwagon and buys insurance policies without giving it much thought apart from saving tax. However before the domino effect takes place, some careful planning can result in far greater benefit.

The first thing that should cross your mind keeping aside tax benefits is “what insurance policy do you really require?”

1. There are many life insurance policies like term plans, ULIPs, pension plans, money back policies and many more. Tax deductions are applicable under Section 80C for these life insurance policies. 
2. Then there are health insurance policies which provide the much needed medical expenses in case of hospitalization. Tax deductions are applicable under Section 80D for these health insurance policies.

Why avail only tax benefits when you can probably get more benefits? And that can be done easily by allocating the stipulated amount carefully. A term plan is a must for securing your family. A ULIP is long term investment plan for fulfilling future goals like children’s education or marriage. A pension plan lets you live comfortably at later days by providing regular income.

Instead of getting a random policy which your colleague or friend chose, consider your requirements and make the right decision. Tax benefits will be there whichever policy you choose.

Health insurance policies are becoming one of the most demanded insurance policies in the market and that too for a good reason. Medical expenses are on exponential rise and having a health insurance policy secures you financially to get the best healthcare treatment.

Consider the complete situation holistically. The insurance you have, whether it is enough and which insurance policies you should buy to seal the deal. Widen your portfolio instead of just taking one or two insurance policies. Get completely secured by having enough coverage of both life and health insurance policy.

Who are Life insurance Companies?

In India, Insurance industry is governed and regulated by Government of India. The concerned authority is Insurance Regulatory & Development Authority (IRDA). The companies which are registered with IRDA can only function as insurers and sell their products.

There are a total of 24 life insurance companies in India. There are both public and private life insurance companies. LIC is among the oldest insurance company and well established brand in India. The life insurance companies listed alphabetically are:

1. Aegon Religare Life Insurance 
2. Aviva Life Insurance 
3. Bajaj Allianz Life Insurance 
4. Bharti Axa Life Insurance 
5. Birla Sun Life Insurance 
6. Canara HSBC Oriental Bank Of Commerce Life Insurance 
7. DLF Pramerica Life Insurance 
8. Edelweiss Tokio Life Insurance
9. Future Generali India Life Insurance 
10. HDFC Standard Life Insurance
11. ICICI Prudential Life Insurance 
12. IDBI Federal Life Insurance 
13. IndiaFirst Life Insurance 
14. ING Vysya Life Insurance 
15. Kotak Mahindra Old Mutual Life Insurance 
16. Life insurance Corporation of India
17. Max New York Life Insurance 
18. MetLife India Insurance 
19. Reliance Life Insurance 
20. Sahara India Life Insurance 
21. SBI Life Insurance 
22. Shriram Life Insurance 
23. Star Union Dai-ichi Life Insurance
24. Tata AIG Life Insurance 

Life insurance products are available to customers through the insurer offices, brokers, banks, agents and also online.

Aviva LifeShield Plus

Plan Name: LifeShield Plus
Insurer: Aviva Life Insurance Company India Ltd
Category: Term Life Insurance Plan

Objective: Financial Protection of Family

Aviva Life Shield Plus is a term life insurance plan which provides financial security to your family in case you are not there to look out for them. You get good cover at low cost. If something unfortunate happens to you, Sum Assured is paid to the nominee. Aviva LifeShield Plus is a risk plan which has no maturity benefits. LifeShield Plus is comprehensive in form and provides additional benefits through riders at nominal additional premium.

Who can buy LifeShield Plus?

Aviva LifeShield Plus term life insurance plan can be bought by anyone who is 18 years old and not more than 55 years. The policy term varies from 10 years to 30 years. In this term insurance plan, the maximum age at policy maturity cannot be more than 65 years.

How Much Cover: The minimum cover in Aviva LifeShield Plus term insurance plan is Rs 10 lacs and the maximum depends on your requirement. Issuance of cover is subject to underwriting.

What cover should you get?

Rule of Thumb: The typical cover should be ten times your annual income.

 
Summarized Table: 

Compare with other term plans now!

What do I get?

Death Benefit: In the event of policyholders unfortunate demise (during policy term), the sum assured is paid to the nominee (parents, wife or children) if the insurance policy is in force.

Tax Benefits: The premium paid is eligible for tax benefits under Section 80C, 10 (10D) of the Income Tax Act, 1961.

Illustration:

Amit aged 32, to secure his family buys term insurance plan- LifeShield Plus with policy term of 25 years.

With yearly premium of just Rs 11922 he gets cover of Rs 40 lacs. Amit nominates his wife as the beneficiary of term insurance plan.

Consider these Scenarios:
Scenario 1: Amit dies in the 2^nd policy year; Amit’s wife will get 40 lacs. This is true for the whole policy term.

Scenario 2: Policy is in grace period and Amit dies, Sum Assured minus renewal premium will be paid.
Scenario 3: Policy lapses on the 22^nd year, Amit dies, nothing will be paid. However lapsed policy can be revived within 30 days from the date of renewal.

RIDERS:

Riders are very useful additional benefits which could be beneficial to the policyholder. They are low priced but their utility is huge. Riders can be added only at the commencement of the term plan or on its anniversary depending upon company’s policies.  Riders available with LifeShield Plus insurance term life plan are:

Aviva Dread Disease: This term life insurance rider provides additional sum assured if the policyholder is diagnosed with specific 18 diseases or suffers disability due to illness or accident. The rider’s minimum Sum Assured or cover is 2 lacs and maximum amount is Rs 50 lacs. The life assured has to survive for period of 30 days after the disease has been diagnosed to get the Rider’s cover. These dread diseases include:

1. Heart Attack

2. Stroke

3. Cancer

4. End Stage Kidney Failure

5. Major Organ Transplant

6. Coronary Artery Bypass Surgery

7. Benign Brain Tumour

8. Deafness

9. Blindness

10. Aorta Graft Surgery

11. Heart Valve Surgery

12. Paraplegia

13. Motor Neurone Disease

14. Multiple Sclerosis

15. Coma

16. End Stage Liver Disease

17. End Stage Lung Disease

18. Aplastic Anaemia

19. Permanent Total Disability

Accidental Death Benefit (ADB): In amount equal to Sum Assured will be paid if the policyholder expires due to accident. The rider premium should not exceed 30% of base policy premium. The death should occur within 90 days after the accident occurs for Rider to take effect.

What Else?

How to buy: Contact Policybazaar and we will assist you in buying LifeShield Plus term plan without any issues.

Free Look Period: Aviva LifeShield Plus can be cancelled within 15 days of receiving the policy contract. The policy document can be returned to the nearby branch along with letter of cancellation. The premium will be paid back minus some charges like medical examination, stamp duty.

Grace period: Aviva LifeShield Plus premium can be paid within 30 days from the date of renewal. In case of quarterly and monthly modes payments, grace period is 15 days. However in case of death during grace period; renewal premium will be deducted from Sum Assured payable. After the grace period, if the renewal premium is not paid the policy will cease to exist.

Reinstatement: LifeShield Plus can be revived within 2 years from the premium due date. Also beyond 6 months, proof of good health will be required. All the unpaid premiums plus relevant interest have to be paid to revive the policy.

Maturity: LifeShield Plus is a pure term insurance plan and as such has no survival benefits.

Surrender: LifeShield Plus term insurance plan can be surrendered (only for single premium) after completion of one year.

The surrender value in Aviva LifeShield Plus is equal to = 0.75*(remaining policy term*single premium)/policy term.

Payment Method: Aviva LifeShield Plus payment method is cash, cheque, credit card/debit card.

Exclusion: In term life insurance, death caused by suicide in the first year or within first year of revival, no Sum Assured will be paid.

Death Claim: The nominee can apply for the death claim (Sum Assured) after filling claim forms along with submitting list of documents which will prove authenticity of the claim.

Close Competitors:

LIC Amulya Jeevan- I, Bharti AXA Elite Secure, Met Suraksha Plus, Kotak Preferred term plan, Max New York Life Platinum Protect, Tata AIG Life Raksha, Bajaj Allianz New Risk Care II, HDFC Term Assurance, Reliance Term Plan, Met Protect Term Plan.

Policybazaar take on Aviva LifeShield Plus:

Aviva LifeShield Plus plan is excellent term life insurance plan that offers spread out benefits with more disease coverage; it covers 18 diseases as compared to usual 6-12 critical diseases. Aviva LifeShield Plus is economical term life plan but is not available online. For buying Aviva Life Shield Plus, click here.

Compare with other term plans now!