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Overview Life Insurance in New Delhi
New Delhi is the national capital of the country. It is also part of the Delhi NCR (National Capital Region) comprising of the neighbouring districts including Ghaziabad, Noida, Gurugram and Faridabad. The city has been the potboiler of Indian politics and has been the starting point of many revolts and protests in the history of the country. It is home to the national leaders of the country as well as many corporate heads.
The citizens of Delhi are a mix of youth and older generations preserving the charm of old Delhi and maintain the vibe of a new world in New Delhi. There are many investment options available for the citizens of New Delhi. However, one of the most significant investments essential for every investor is life insurance.
The recent pandemic has shown how unpredictable life can be and even in the national capital of the country, people did not have adequate facilities to cope with the true impact of this pandemic. in such scenario having a safety net and a backup option in any unfortunate circumstance is imperative for every citizen. Life insurance in such cases can be used by the family of the deceased to cope with the financial loss of their breadwinner even when the emotional loss is irreplaceable.
Given below is the need and importance of life insurance in New Delhi.
What is Life Insurance?
Life insurance is one of the simplest forms of insurance available to the citizens of New Delhi. This type of insurance can be used to cover the financial loss of life of a person and safeguard the future of their family. There are many types of insurances available in the market today other than the plain basic types of insurances. These dynamic insurances not only provide life cover but also a good investment opportunity.
Some of the basic types of insurance available for the citizens of New Delhi are,
- Term plans
Term plans are the basic types of life insurances. These plans do not provide maturity benefits. They are some of the cheapest forms of insurance available in the market. The nominee gets death benefits under this plan. The tenure of the plans is usually for 5 years to 50 years.
Additional Reading: How To Select The Best Term Insurance Plan
- Retirement plans
Retirement plans are another common type of life insurance plans centered to provide retirement benefits in old age. These benefits are in the form of fixed monthly income or pension to provide financial security in the retirement of the policyholder. Some policies also provide a lump sum corpus fund at the discretion of the policyholder.
- Money-Back plans
Moneyback plans are suitable for people who require the sum insured at regular intervals. The balance amount, if any, of the sum assured is given to the policy holder at the time of maturity of the policy.
- Endowment plans
Endowment plans provide the dual benefit of insurance and investment in a single plan. It is a long-term policy with tenure for 10 years to 35 years. These plans can be used to gradually building a corpus fund. Such funds can then be utilized to meet the long-term financial goals of the family-like wedding in the family, travel, child’s education buying a new home, etc.
- ULIPs
ULIPs are the Unit Linked Insurance Plans providing the benefit of the mutual fund market along with life insurance. This policy allows the investors to choose the fund that they want to invest in. Then a portion of the premium paid will be invested in such fund. Tenure of these policies can be from 10 to 20 years and the minimum lock-in period for these plans is 3 to 5 years.
- Whole life insurance plans
Whole life insurance plans are plans that provide coverage for the whole life of the insured person. These plans may or may not have any investment component as the focus of the plan is coverage for life. The tenure of the policy is usually for the long term with a maximum tenure of 99 years. Maturity benefits are paid to the policyholders at the end of term or death benefits are paid to the legal heir. Many insurers also allow the policy holders to make premium payments for a period of the first 10-15 years of the policy term and enjoy the benefits of the plan for life.
Additional Reading: Whole Life Insurance Life Coverage To The Life Assured For Whole Life
- Child plans
As the name suggests, these plans provide coverage for the children specifically. Child plans can be opted by parents from the time of the birth of their child till the time they reach adulthood. The amount can be withdrawn at the time of maturity and used to meet the needs of the children like higher education, wedding, etc.
Additional Reading: Secure Your Childs Future With A Child Insurance Plan
- Group life insurance
Under this type of insurance, coverage is taken by the employer of an organization for all their employees as blanket cover. Many insurers also include their families under this cover. Some insurers provide the option to convert this policy to individual life cover when the employee leaves the organization.
Additional Reading: How does a group life insurance policy work?
Life Insurance in New Delhi FAQs
1. How is the premium amount decided for life insurance?
A. The premium amount on life insurance is based on many factors. These factors are,
- Coverage amount
- Age of the applicant
- Number of members covered
- Employment status
- Income of the applicant
- Location of the applicant
- Marital status
- Existing policy (if any)
2. What are the documents needed for getting life insurance?
A. The documents needed for getting life insurance are,
- Proof of address
- Proof of identity
- Proof of age
- Income proof
- Medical certificate
- Insurance application
- Any other document as per the guidelines of the insurer
3. Who can buy life insurance in India?
A. Life insurance in India can be bought by any resident Indian for themselves or their family members. NRIs can also buy a life cover in India provided they meet all the eligibility parameters and submit proper documentation.
4. What are the benefits of having life insurance?
A. There are several benefits of having life insurance. It is a good investment option for every generation. Some of the benefits of life insurance are mentioned below.
- Coverage for self and family
- Option to get a loan between 70% to 90% of the policy amount
- Additional riders on an existing plan
- Tax deduction under section 80C up to Rs. 1,50,000
- Insurance coverage for fixed tenure or life
- Option to earn mutual fund returns under ULIPs
5. are medical tests mandatory for getting a life insurance policy?
A. Yes. Life insurance policy requires applicants to submit the mandatory list of medical tests as per the insurer’s guidelines. These tests help to determine the premium amount and policy amount.