Affordable Indian Insurance, Affordable Insurance in India

By: EconomyWatch   Date: 26 May 2010

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Affordable Indian insurance has seen robust growth in the past few years. Till the year 2000, the concept of affordable Indian insurance was dominated by state owned corporations only.

The dawn of policy sector reforms witnessed the entry of several private players who began their operations in India. The Insurance Regulatory and Development Authority (IRDA) is the country’s official agency to formulate regulations and redress grievances pertaining to the insurance sector.

Take life insurance in India, for which an individual pays a fixed amount for a specific period. This way, he/she is entitled to the entire policy amount in case of death during policy tenure. Life insurance policies in India are mostly of two types: term life insurance and permanent life insurance.

In a term life insurance policy, an insurer pays a guaranteed amount of money to the designated beneficiary of the policy. This payment occurs upon the policy holder’s death. Such policies have low premiums but no cash value.

However, a permanent life insurance policy offers multiple advantages such as money back and tax benefits. An insurer invests some money from these premiums to earn cash value.

Types of Affordable Indian Insurance Policies

Here are different types of insurance policies which are available in India. These affordable Indian insurance policies are as follows:

Personal accident cover: This policy covers death or permanent disablement due to accident. It is one of the most affordable Indian insurance policies as it has the lowest premiums. Those who are not eligible for life insurance policies due to health problems can opt for personal accident cover.

Health insurance: A mediclaim or healthcare policy provides financial cover for medical expenses incurred in case of sudden illness or critical illness. The healthcare policy includes hospitalization bills, nursing, diagnosis and medicine costs.

Home insurance: A home insurance policy or householder’s insurance provides financial cover for the physical structure of a house and the household items. It provides cover against natural disasters such as earthquakes, floods or fires, thefts, and terrorist attacks.

Pension Plan: A pension plan or retirement solution policy is the most popular insurance plan among urban professionals. Timely investment is essential for future savings. You can also consider opting for a flexible retirement plan with a partial withdrawal clause.

Though personal discretion plays a significant role in insurance, there has been increased financial awareness due to which people are keen to make timely investment in insurance policies.


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